When you hire an independent contractor, keep documents to prove that the contractor really isn’t an employee.

If you hire an independent contractor (IC), you must be vigilant to ensure that government agencies never re-classify that IC as an employee — which could subject you to back taxes and penalties. That vigilance must begin even before the IC walks in the door. If you plan to hire an IC, here are two things you can do to make sure you get the relationship off to the right start.

Independent Contractor Questionnaire

When you meet with a prospective IC for the first time, you should have the IC complete an independent contractor questionnaire. You should design this questionnaire to elicit the sort of information that will establish that the IC is a separate business entity, not merely an employee in IC’s clothing. Here is some information you’ll want to know:
• whether the IC has a fictitious or assumed business name
• how the IC’s business is structured (for example, sole proprietorship, partnership, corporation, limited liability company)
• the IC’s business address and phone number
• the number of people employed by the IC, if any
• any professional or business licenses the IC holds
• contact information for other companies for whom the IC has worked as an independent contractor
• how the IC markets her business (for example, Yellow Pages, advertising)
• whether the IC has an office separate from his home
• a description of the business equipment and facilities that the IC owns
• whether the IC has his own business cards, professional stationery and invoice forms, and
• a list of all of the types of insurance that the IC carries.
None of the answers to these questions will provide conclusive evidence that a worker is an employee or an IC. But taken together, this information will help you decide whether the worker is an independent businessperson whom you can safely treat as an IC.

Note: Do not ask an IC to complete one of your standard employment applications.
Government agencies can use the mere fact that the IC filled out an “employment”
application as evidence that the IC is actually an employee.

Gather Documents

Before hiring an IC, make sure that the IC has the sort of documents that will enable you to establish that the IC is a separate business entity, should the government ever decide to audit you. Make copies of all such documents and keep them in your files along with the questionnaire described above.

The documents you should request include the following:

• copies of the IC’s business cards and stationery
• copies of any advertising that the IC has done, including advertising in the Yellow Pages
• a copy of the IC’s White Pages business listing, if there is one
• if the IC is operating under a fictitious or assumed business name, a copy of the fictitious or assumed business name statement or application
• copies of any business or professional licenses
• certificates showing that the IC has insurance, including general liability insurance and workers’ compensation insurance if the IC has employees
• a copy of the invoice form that the IC uses to bill for his services
• if the IC rents business space, a copy of the office lease
• if the IC has employees, a document containing the IC’s unemployment insurance number
• copies of IRS Form 1099-MISC that other hiring firms have issued to the IC, and
• if the IC is a sole proprietor and will agree to hand them over, copies of the IC’s tax returns for the previous two years showing that the IC has filed a Schedule C, Profit or Loss From a Business (which will show that the IC has been operating asan independent business).

Get more tips and resources including the 20 factor test for identifying an independent contractor at HRSentry.

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I ran across a piece written on office politics by my friend Bill Reynolds of CompEraser and thought everyone on here would enjoy it.  The article provides some great pointers on what it takes to gain the trust and respect needed to take your career to the next level.

By realizing the subtle, pervasive, necessary, and often positive nature of organizational politics, you will be well on your way to developing political awareness. Each organization has its own political rules of conduct. By being patient, cautious, and observant, you can learn to recognize and employ behavior that is politically correct for your particular workplace. In addition, there are some general guidelines for practicing organizational politics in most any workplace:

Pay your dues. You should not expect to receive any favors or support until you have contributed in significant ways to your department organization. This is especially important advice for organizational newcomers. You earn credibility support, and the right to influence others by working hard and demonstrating your trustworthiness. By accepting unpleasant tasks, assisting others, and working extra hours initially, you build up a reserve of credit fro advancing yourself and your goals later on.

Listen and observe. Because the political atmosphere is implicit and subtle in most organizations, skills of listening and observing are important. By listening, you can notice who advances what ideas, who supports whom, what subtle suggestions are made, and what topics are awkward. Keen observation can reveal what projects receive high priority, where informal lines of communication occur, and the nature of alliances and animosities. The real power in organizations does not always lie with the visible power holders. By noticing the geographic placement of offices, seating arrangements in meetings, alternative meanings to statements, and the pattern of workplace friendships, you can begin to identify informal power, norms, and expectations.

Understand the people in your organization. In order to get along with and to influence others, you must pay attention to the personality traits and organizational interests of the political players. Being a good judge of character is an ingredient of political savvy that helps you determine allies and methods of influence. Who are the fence sitters? Who are the opinion leaders? Which colleagues make decisions based on tradition, evidence, cost-effectiveness, or majority sentiment? Some people need to be coaxed, praised, or reassured. Others welcome directness and debate. Some people are risk takers and others are cautious. Still others block every attempt to change. Remember that employees in an organization want to protect their self-interest. By identifying those interests and styles of behavior, you will become skilled at dealing with people.

Identify power sources. Because organizational politics is so closely tied to power, it is important to appraise the relative power positions of individuals and organizational units. Who makes what decisions? Who controls what resources? Who has influences with supervisors? Learn to recognize both formal and informal power. For example, those in legitimate positions with the ability to reward or punish others are obviously powerful. But so are those who possess valuable information, indispensable skills, or charismatic personalities. Sometimes the least obvious person wields the most power.

Build partnerships. Most people operate according to the principle of reciprocal favors. If someone helps, supports, or acts kindly towards you, you are likely to feel obligated to return the favor. Maxims such as “One good turn deserves another” or “Scratch my back and I’ll scratch yours” illustrate the reciprocity ethic. Politically wise managers build alliances based on this principle. By supporting each other, two colleagues have more strength as a team than they would individually.

• Two points about the judicious use of this strategy are worth mentioning. First, it is rarely necessary to remind people that they owe you a favor. To make such an explicit statement is to bring the political process to an awkwardly obvious level. It also insults others to imply that they aren’t holding up their end of the bargain. Indeed, the best alliances are implicitly understood rather than fully expressed in the first place. The second caution concerns the overuse of predictable alliances. If the work group realizes that two people always side with each other regardless of the issue, the group will discount the partnership.

Never overuse power. Being blatant with power is a sure way to lose it. Power can be regarded as your ability to influence others minus the others’ ability to resist. It is a transaction between people, not an entity one person possesses. A manager who is tyrannical with power will create much resistance. A better approach is to avoid obvious displays of power. Managers, for example, who arbitrarily mandate new procedures for reports often get complaints, refusals, and sabotage from their staff members. By gradually and subtly influencing staff members to see the value of the new procedure instead, you will find compliance and support. Indeed, even in the absence of supervision, the staff will continue to do the reports in the new way because they have internalized your perspective on the issue.

Learn to negotiate. Politically savvy managers are good negotiators who know when to make concessions and when to hold out. By compromising several smaller points, they can often win on big issues. Effective negotiation involves careful listening, a sensitivity to nonverbal cues, the strategic use of questions, a knowledge of options, a sense of timing, and a confident style of communication. Negotiation is involved in many aspects of the managerial role. You may find yourself negotiating with supervisors, subordinates, colleagues, potential employees, unions, customers, citizens, or vendors. It is inherently a political process because it involves subtle attempts to influence others to gain power or achieve a goal.

Have any additional tips or pointers?  Feel free to post them!

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Over the past decade there has been an increase in organizations that have setup up wellness programs designed at reducing health care costs and raising morale. The increase in such programs has drawn a fair amount of both praise and criticism. Employers struggle with issues such as how to implement the programs, where the funding comes from, and how to judge the cost/benefit of having such a program.

Three traps exposed by HRTechNews:

1. The “one-size-fits-all” approach: For good reason, your organization doesn’t simply copy other firms’ 401(k) plans or compensation designs. Yet, all too often, firms adopt ill-fitting wellness programs based on things that have worked elsewhere.
2. Leaving the program on autopilot: Many wellness programs often get off to a good start and then fizzle out. Employers are left wondering what went wrong. Their mistake: They failed to revisit the program on an ongoing basis – at least every other year.
3. Unrealistic expectations: Generally, it takes at least a year and a half for employers to break even on the cost of a wellness program. As a rule of thumb, the average program cost per employee per month to the employer is about $3 to $5.

The previous traps show common ways that employers setup a system without being truly invested in it. Proper thought and planing must go into a wellness program or it will not meet expectations. It is important to design a program geared to address the concerns of your employees that act as cost-drivers for the company. This article has identified several key places to look when deciding what kind of program would fit your organization.

Key places to look:

• your organization’s medical-claims breakdown for the last three years
• prescription-drug claims
• employee absence information
• EAP use
• disability claims, and
• employee demographics (workers’ ethnic, gender, age and dependent coverage status points to greater – and lesser – health risks associated with each category).

For more resources on employee wellness programs visit the Wellness Council of America. To access an in-depth wellness program guide, activate your HRSentry account today.

When most people think of religious discrimination the usual denial of accommodation by the employer comes to mind. A recent article on BLR.com brought up an interesting case that looks at discrimination in another light. The situation that arose was with Kelly Services in California, and it puts a different meaning to the term religious discrimination. In the recent case of Noyes v. Kelly Services, an employee was turned down for a promotion and filed a lawsuit charging reverse religious discrimination under the California and federal antibias laws. She claimed that she was discriminated against for not being part of the same faith that the manager belonged to. The woman claimed that after having applied for a promotion she was turned down in favor of someone who had been there six years less, and lacked the masters degree in business administration that the plaintiff held. As proof of this bias the plaintiff pointed to the last six promotions by the manager, five of which were members of the same faith.

The Courts found that:

(1) although Kelly Services argued that the promotion decision was consensus-based, the other managers couldn’t recall reaching a consensus, and one stated that the manager ultimately made the decision;

(2) His actions prevented full consideration of the woman for the job by the other managers;

(3) He favored Fellowship members and the co-worker in particular (for example, paying the co-worker a higher salary for the same job she held and frequently hiring Fellowship members as temporary contractors and giving them management jobs).

The case went to a jury which awarded the employee $647,000 for economic and noneconomic losses, in addition to a whopping $5.9 million in punitive damages.

Workplace favoritism can be an expensive issue, Here are some tactics for avoiding similar problems as seen on BLR.com:

• Have clear policies to govern how promotion and hiring decisions are made.
• Make sure the promotion selection process includes oversight and review by upper management and/or human resources.
• Provide training for managers on the policies and procedures governing promotions.

Get all your policies and desktop training for employees at HRSentry.

With small businesses and large corporations all facing tough economic times, organizations are looking everywhere for ways to cut costs. One way to do this is by examining how procedures and organizational shifts can save money. One such method HR can take to reduce risk is to keep disgruntled employees from talking to a lawyer by instilling confidence in the processes HR has in place. By consistently and clearly stating your policies and processes in a fair way, employees will trust that HR has the EMPLOYEES concerns in mind and will use the complaint process in place to voice their concerns. The less employees go outside of the organization for legal advice, the less likely they are to suit.

Retaliation claims can be extremely hard to defend against, and the penalties for those found guilty aren’t getting any easier. In a recent ruling on a case in Cambridge MA the jury awarded a woman $4.5 million after claiming retaliation for an earlier discrimination suit. After filing the original suit for discrimination, the woman claimed that her manager unfairly over-analyzed her work giving her poor reviews in hopes to get her to quit. Finally she was told she was being fired so she resigned and brought the company to court.

With the number of retaliation claims on the rise, now makind up 32% of all claims filed with the EEOC, companies need to understand how to defend themselves against such situations. The first step to take is making sure that all supervisors and managers are aware of the retaliation law and its consequences. Providing training in this area as well as discrimination(many retaliation claims originate with discrimination claims against that company) will help to reduce the risk, and show that you are actively working to stop this type of behavior. It also helps if HR has the confidence of the employees. As I have continually stressed throughout this blog, a good HR department will cause workers to talk to them instead of a lawyer. Workers who seek legal advice are much more likely to suit then if your HR department can remedy the situation in a fair yet cost effective way for all parties.

A list of techniques to lower the risk of retaliation claims presented by HRMorning includes:

• Have a credible complaint procedure, describe it to the employee and promptly follow the procedure.
• Thank the employee for the information.
• Underscore your zero-retaliation policy.
• ask the employee to report any further experiences or events resulting from the complaint or participation in the investigation — letting the employee know you’re interested in making certain he or she gets fair treatment during the investigation.
• Pay attention to the little stuff the employee reports. If the employee is mentioning it, it’s not little

Visit the HRSentry Blog for more tips and resources for all things HR.

A recent article released by Aliah D. Wright on the SHRM website discusses the change in orientation and onboarding that is occurring with advancements in technology. With the days where employees joined a company and stayed there throughout their career gone, companies are striving to find ways to keep employees engaged and happy. One of the big reasons for the increase in employee turnover is easy access to job postings through sites such as CareerBuilder and Monster as well as salary information. This allows employees to constantly be searching for a better opportunity with the resources available to quickly follow-up when one comes up.

One way to combat this is to make the onboarding experience more effective. By integrating this process with online technology, employers are able to provide all employee information(Paperwork, Contacts, and Policies) in one place.

According to a study of HR and business unit managers released in February 2008 by the research company The Aberdeen Group:

• 86 percent of organizations surveyed agreed that newly hired employees decide whether or not to stay with their employer within the first six months of their employment.

• 68 percent of best-in-class organizations surveyed describe their onboarding systems as partially automated or fully automated.

• Of the remaining 32 percent, more than half plan to adopt technological tools to automate their onboarding efforts over the next year.

Compare that to a 2006 SHRM survey:

• Although 83 percent of companies reported the use of a formal orientation (or onboarding) program for new employees, only 11 percent of companies conducted orientation programs using a computer-based format, preferring instead to use group-based and individual sessions.

For more tips and resources regarding employee onboarding, visit the HRSentry website or visit the Blog.

There are many ways hiring interns can add value to your organization. They can minimize the impact to your hiring budget. They may work on projects that need to be completed that free up your experienced employees to work on more complex assignments. Oftentimes interns will bring new ideas and energy into an organization. They may even become great full-time employees who are already trained in job functions and are therefore immediately productive.

When considering a Paid Internship, be thinking of the following:

* Even though you are required to only pay the Federal or State minimum wage, consider the education and knowledge of the students you want to hire.
* Consider the job requirements, skills and responsibilities necessary for your internship. Will your intern need to perform basic skills, or will they be asked to perform duties that require a higher level of expertise?
* If you are not sure what the fair market wage is for the position you want to fill, make a quick call to your local college or university and ask for the career development office, or contact another local business to see what they pay. Most employers are happy to share information with you.

When considering Unpaid Internships, be thinking of the Department of Labor’s Criteria:

Federal and State Laws dictate whether a particular job is considered an internship or a paid worker position. Although the Department of Labor doesn’t use the word intern, or provide a definition of such, they have developed criteria to determine if a learner/trainee is a paid employee entitled to minimum wage and all other applicable laws, or a learner/trainee that is unpaid or paid a stipend. The definition of employee differs from labor laws and workers compensation state laws as well. Please be sure to check all applicable state laws in addition to federal regulations.

The 6 criteria developed by the Department of Labor that must be met in order for the positions to be an Unpaid internship are:

1. The training, although it includes actual operation of the facilities of the employer, is similar to the training which would be received from a vocational school.
2. The training must be for the benefit of the intern.
3. The intern must not displace regular employees, but work under the close observation of a regular employee or supervisor.
4. The employer provides the training and derives no immediate advantage from the activities of the intern, and on occasion, the operations may actually be impeded by the training.
5. The intern is not necessarily entitled to a job at the end of the internship.
6. Both the intern and the employer understand that the intern is not entitled to wages. A student may be able to receive a stipend however.

All of these criteria must be met in determining if the intern is a paid employee or a learner/trainee.

Of these 6 criteria, three of them are very straightforward:

* #3 - the intern cannot displace regular employees
* #5 - the intern is not guaranteed a job at the end of the internship
* #6 - the intern is aware and has agreed there are no wages due

The other three criteria are more open to interpretation. Be sure to verify state labor laws. Other areas to be considered when hiring a student are Federal and State Child Labor and Workers Compensation Laws.

Once you have developed a job description and the wages have been determined, be sure to let your employees know that you are hiring. Employees are oftentimes the best source for referrals. And don’t forget to spend your money wisely. Interview the interns like you would a full-time employee. Do a few reference checks with their prior employers if possible, or contact a professor. The job may only be for the summer, but if you hire poorly, it can be a long summer.

With a recent ruling, the 9th U.S. Circuit Court of Appeals determined that employees have the right to privacy when sending text messages on company owned devices where information is stored on a third party server. This contradicts previous practices where the company has full disclosure over everything done on company property.

In Quon V. Arch Wireless, the issue began when a police department issued pagers that could send and receive text messages. After an investigation it was found that several officers were consistently going over the characters allowed to be sent/recieved per month. Officials requested that the service provider hand over transcripts of the archived messages to see if the overage charges were being caused by non-work related messages. After reviewing the text messages the officials noticed that not only were many of the messages personal, some contained sexually explicit content. Officer Quon responded by saying that according to informal policy and regular practice, as long as officers covered the overage charges, no audits would be conducted.

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According to legislation passed by the House of Representatives, the head of every federal agency must create a program allowing authorized employees to telecommute at least 20 percent of their work hours every two weeks. Following a growing trend of increased telecommuting in the private sector, the move will give employees the opportunity to work some hours from home saving money on gas as well as providing the employee more control over their environment. According to the Business Legal Review, over the past several years telecommuting has increased an average of 11 percent a year. In 2007 over 35 percent of jobs globally include some sort of telecommuting option.

While there are definite merits to creating a telecommuting program, there are also some pitfalls that need to be addressed to ensure its success. Providing such an option to certain employees and denying it to others for reasons such as home location and seniority can cause discontent from those unable. This can be especially dangerous in a team environment and can lead to lower morale as well as higher employee turnover.

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