Ch 12 Compensating the Flexible Workforce

Right to control: Employee or independent contractor?

-Employee if employer controls details of the work -Independent Contractor if worker controls the details of the work

How to test if independent contractors are employees? (2)

-common-law test -economic realities test

Employers Right to control criteria categories (3)

1. Behavioral 2. Financial 3. Type of relationships

Three legal tests to determine a workers status

1. Common-law test (used by IRS) 2. economic realities test 3. hybrid test

1. ERISA 2. NLRA 3. ADA 4. ADEA 5. PPACA

1. Employee retirement income security act 2. National labor relations act 3. americans with disabilities act 4. age discrimination in employment act 5. patient protection and affordable care act

Reasons to hire temporary/OC employees (5)

1. Fill in for core employees 2. Help ease high demand periods 3. help determine future employment needs 4. Assess employee for a core position 5. Don't receive company benefits

Requirements to participate in retirement plan (2)

1. Fulfilling the ERISA age requirement (21) 2. Completion of 1,000 hours of work in a 12 month period.

Leasing companies pension three requirements

1. Nonintegrated employer contribution rate of at least 10% 2. provide full and immediate participation in vesting 3. allow each employee to immediately participate in plan

Union concerns with Part Time employment

1. PT employment erodes labor standards; often denied fringe benefits, job security, and promo opportunities

Part-Time Benefit Issues (2)

1. Pay on hourly basis or a salary basis? 2. do companies offer benefits to PT workers?

Union Concerns with Temporary employment (2)

1. Temp employees can have little concern for improving company productivity 2. Union bargaining power becomes weak when companies demonstrate effectiveness w temp employees

part-time employees (2 kinds)

1. Voluntary 2. Involuntary

Cost control objectives in using contingent and flexible workers (2)

1. contingent employment allows for lower discretionary benefit costs and provides less generous amounts of benefits 2. well-trained contingent workers can reduce training costs

Reasons for employers increased reliance on contingent workers (3)

1. economic reasons 2. international competition 3. shift from manufacturing to a service economy

Companies are not responsible for what 4 things when it comes to independent contractors?

1. federal taxes 2. FLSA overtime/min wage 3. workers comp 4. ERISA, NLRA, ADA, ADEA, PPACA, Title VII of Civil Rights Act

Flexible work schedules include (3)`

1. flextime 2. compressed work weeks 3. telecommuting

Drawbacks of flextime (2)

1. increased overhead costs 2. coordination problems

Union concerns with flexible work schedules (2)

1. long days of compressed workweeks or flextime could endanger workers safety/health, even if worker chooses this 2. employee isolation, uncompensated overtime, & company monitoring in the home

Benefits of flextime (3)

1. lower tardiness and absenteeism 2. higher productivity 3. extended business hours

Types of Contingent Workers (4)

1. part-time employees 2. temp and on-call workers 3. leased employees 4. independent contractors, freelancers, consultants

Benefits to compressed workweek (3)

1. promote recruitment and retention 2. reduces commuting time 3. allows more family time

Telecommuting arrangements (5)

1. satellite work centers 2. neighborhood work centers 3. nomadic executive office 4. work off site or and/or on site 5. temporary or permanently

Companies hire temporary employees through three sources

1. temporary employment agencies 2. direct hire arrangements 3. on-call arrangements

Leaded employees cannot constitute more than ___% of the recipients "non highly compensated workforce"

20%

__% of part time workers have access to retirement benefits compared to __% of full time workers

37% part time, 74% full time

Common law test

Employment relationship exists if employer has right to control work process, as determined by evaluating totality of circumstances and specific factors.

independent contractors, freelancers, consultants

Establish working relationships with companies on their own. Possess specialized skills

Dual Employer common law doctrine

Establishes temporary workers rights to receive workers compensation

Advantages of Job Sharing

Flexibility, reduced costs, maintains productivity levels

Advantages /Disadvantages (2) to telecommuting

Adv- same as flextime Dis 1- Less direct employee interactions Dis 2- makes performance appraisals difficult

Part time workers (are/are not) protected under PPACA (heath insurance)

are not

Voluntary part time employee

chooses to work fewer than 35 hours

Following resignation, PT workers are eligible to...

Purchase health insurance under COBRA rules

Common law

developed by judges through court proceedings that decide individuals case

Economic Realities test

employment relationship exists if individual is economically dependent on a business for continued employment

Compressed workweek schedules

enable employees to preform their work in fewer days than a regular 5-day work week (4 10s)

Who is responsible for Leased workers discretionary benefits?

leasing and hiring companies

Leasing company is a _____ employer

legal

Flextime

set weekly not daily hours, May have core work hours

Leased employees are covered by _____

the Safe Harbor rules

Involuntary part time employee

works fewer than 35 hours per week because they are unable to find full-time employment

Strategic objectives in using contingent and flex workers

Contingent employment could bring an influx of new employees with new ideas and minimize group think

Telecommuting

Employees work at home or off-site (excluding the office).

Contingent Workers

Individuals who do not have an implicit or explicit contract for ongoing employment

Core employees

Individuals with long-term or indefinite relationships with employers

leased employees

Lease companies employ qualifed individuals and place them in client companies on a long-term basis.

Safe Harbor Rules

Leased employees must be covered by the leasing company's pension plan.

Economic Realities Test

Main focus- is the employee financially dependent -Significantly applied in the context of the Fair Labor Standards Act.

Do companies typically provide discretionary benefits for temporary employees?

No

FLSA min. wage and overtime pay provisions apply to temp. workers (T/F)

True

Job Sharing

Two or more PT employees preform one job.