The U.S. Department of Labor, Office of Federal Contract Compliance Programs (“OFCCP”) recently issued a proposal to revise the Scheduling Letter and itemized listing of documents which federal contractors are required to submit during an affirmative action compliance audit.  The OFCCP’s current Scheduling Letter and itemized listing will expire on September 30, 2011.

The OFCCP is seeking to both add new requirements and make changes to existing data requests. The proposed modifications include:

1. Adding two new items which require submission of employment policies covering the FMLA, pregnancy leave, and accommodations for religious observances and practices and also submission of the last three years of contractors’ Veterans’ Employment Reports (VETS-100 and/or VETS-100A).
2. Clarification of information requested in connection with collective bargaining agreements and information on reporting requirements for the preceding year.
3. Changes to current employment activity requests to require submission of more detailed demographic information related to hires, applicants, promotions and terminations, as well as requiring data submissions by job group and job title, instead of by job group or job title. In addition, the proposals would require more detailed demographic information on compensation by submitting aggregate data as opposed to disaggregate data.
    

 

OFCCP ’s Director, Patricia Shiu, stated in a webchat held on July 12, 2011 that the OFCCP will review the “few comments received” and “will make a determination regarding the letter and the itemized listing in the very near future.” She further stated “our goal is to complete our consideration of the comments, any revisions needed, and return the document with any appropriate revisions to OMB by no later than the end of July.” Shiu added that the OFCCP will follow Office of Information and Regulatory Affairs protocol and will provide a second public comment period prior to issuing a final Scheduling Letter and itemized listing. Although the current Scheduling Letter and listing are set to expire September 30, 2011, Shiu stated “we do not anticipate that an emergency extension will be needed.”

The second comment period regarding the OFCCP’s proposed Scheduling Letter changes has not been announced. However, it appears fairly certain that Scheduling Letter changes will be enacted for audits conducted after September 30, 2011.
 

As described in a September 2010 post, the Patient Protection and Affordable Care Act of 2010 (the "Act") generally prohibits all group health plans and health insurance issuers (including grandfathered plans) from imposing annual or lifetime dollar limits with respect to certain "essential health benefits" (as defined in Section 1302(b) of the Act) for plan years beginning on or after September 23, 2010. For plan years beginning prior to January 1, 2014, however, plan sponsors may apply certain "restricted annual limits" ("RAL") in accordance with the interim final regulations, issued jointly by the Internal Revenue Service, the Department of Labor, and the Department of Health and Human Services ("HHS") on June 28, 2010.

The RALs are intended to provide transitional relief to certain group health plans and health insurance issuers that currently impose annual limits on essential health benefits. However, in recognition of the difficulties that the annual limit requirements would create for existing limited benefit plans, or "mini-med" plans (e.g., a temporary health insurance plan with a $10,000 annual limit on essential health benefits), the Act authorized HHS to establish an annual limit waiver program for eligible plans or policy issuers. The waiver program is described in the June 28, 2010 interim final regulations ("IFR").

On September 3, November 5, and December 9, 2010, HHS's Center for Consumer Information and Insurance Oversight ("CCIIO") issued guidance, which explains the requirements for the annual limit waiver application process. Waivers previously granted in accordance with that guidance are valid for one year.
 

September 22 Deadline: On June 17, 2011, the CCIIO issued supplemental guidance which includes procedures for obtaining an extension of existing waivers, and revisions to the application process for new applicants. Additionally, the supplemental guidance requires plans or policy issuers to provide eligible participants and policy subscribers with an "Annual Notice," provide HHS with an annual update, and retain waiver-related records in case of an HHS audit, as described below. Significantly, HHS announced that all waiver extension requests and new applications for waivers must be received on or before September 22, 2011. New application and extension request forms are available on the CCIIO's website. Plans or policy issuers that do not receive approval for an extension or waiver will be required to come into compliance with the annual limit rules under the Act and the IFR.

Extensions for Plans or Policy Issuers with Existing Waivers: Plans and policy issuers that wish to extend existing waivers (i.e., those received for the plan or policy year beginning on or after September 23, 2010, but before September 23, 2011) must request a waiver extension by submitting the extension request form described above. The request should include updated contact information, enrollment information for the plan or policy, the plan's or policy's current annual limit, and a signed attestation that the plan or policy continues to satisfy the eligibility criteria for obtaining a waiver. Once the initial waiver extension is granted, plans or policy issuers must submit the same information at the end of each applicable calendar year (i.e., December 31, 2012 and December 31, 2013).

Existing waivers may be extended until January 1, 2014, so long as the plan or policy issuer: (1) provides the information described above by the end of each calendar year for which the extension applies; and (2) retains all records pertaining to the waiver application in the event of an HHS audit (see discussion below).

For New Waiver Applicants: Under the supplemental guidance, a plan or policy-issuer is eligible to apply for a new waiver if: (1) the plan or policy was issued prior to September 23, 2010; (2) the plan or policy issuer (with respect to the policy) has never applied for or been granted a waiver; and (3) the plan or policy coverage does not exceed the RAL amount for the applicable plan year (see footnote 1). New applications will be reviewed using factors listed in the CCIIO's November 5, 2010 guidance. Applicants may also submit optional supplemental information to demonstrate how the plan's or policy issuer's compliance with the IFR (in the absence of a waiver) would result in a "significant decrease in access to benefits" or a "significant increase in premiums."

Annual Notice Requirement: Under the CCIIO's December 9, 2010 guidance, plans or policy issuers with existing annual limit waivers must provide an "Annual Notice" informing all eligible participants and subscribers that the plan or policy does not satisfy the minimum restricted annual limits for essential health benefits and has received a waiver of the requirement. Mandatory language for the Annual Notice is provided in the June 17, 2011 supplemental guidance. Plans or policy issuers may not use other notice language to satisfy this requirement, unless the plan or issuer obtains permission from the CCIIO. The Annual Notice must be provided each year the annual limit requirements are waived, and must be provided conspicuously, in bold 14-point font, on the front of plan or policy materials that describe the plan's or policy's terms of coverage (e.g., summary plan descriptions).

Record Retention: Plans or policy issuers with existing waivers must retain all waiver-related records (including documentation used in supporting the plan's or issuer's original waiver application). If, during audit, HHS determines the waiver data provided by an applicant contains material mistakes or omissions, HHS may withdraw the waiver or extension, and require the plan or policy issuer to come into compliance with the annual limit rules under the Act and IFR.

ACTION REQUIRED: Plans or policy issuers seeking to extend existing waivers or to apply for new waivers should prepare (or have prepared) extension requests or new applications in accordance with the requirements and procedures contained in the CCIIO's June 17, 2011 supplemental guidance, for submission on or before September 22, 2011.

Plans or policy-issuers that have been granted a waiver or extension should review the revised compliance requirements described in the supplemental guidance, which include providing an annual update to HHS, providing an Annual Notice to all eligible participants and policy subscribers, and retaining all waiver-related records to avoid issues that could arise in an HHS audit.
 

In December 2010, we posted on the National Labor Relations Board’s (NLRB) proposed rule that would require private sector employers to post a notice advising employees of their right to join a union and of their other rights under the National Labor Relations Act (NLRA). On August 25, the NLRB adopted, by a 3 to 1 vote (Member Hayes dissenting) the Final Rule requiring the workplace notice. The Final Rule is scheduled for publication in the Federal Register on August 30 and will go into effect 75 days from that date, on November 14, 2011.

As we discussed in our earlier post, the notice will be an 11x17 inch poster, detailing employees’ rights under the NLRA. It also provides the NLRB’s contact information for use in the event an employee believes there has been a violation of the NLRA. The notice will have to be posted by November 14 both in hard copy at the worksite(s) and electronically on an internet or intranet site, if the employer customarily uses such electronic sites to communicate with employees about company rules and policies.

Despite the 7,000 comments received during the comment period, there were very few changes to the proposed rule. In particular, the Final Rule does not require that employers email the notices to employees or that the notices be printed in color. In a very small victory for management, the Final Rule does include language regarding an employee’s right to refrain from union activity.
 

The Final Rule sets forth three possible consequences for failure or refusal to post a notice. First, such failure may be grounds for an unfair labor practice charge under § 8(a)(1) of the NLRA, which prohibits employers from interfering with, restraining or coercing employees with regard to the exercise of rights granted under the NLRA. Second, failure to post the notice may extend the six-month statute of limitations period for filing an unfair labor practice charge, unless there is evidence the employee had actual or constructive notice that the conduct was unlawful. Third, where the NLRB finds a knowing and willful failure to post a notice, it may use the failure to post as evidence of unlawful motive in an unfair labor practice case. Initially, however, the NLRB has indicated that its focus will be on compliance, assuming that most employers who do not post a notice are simply unaware of the rule. In those circumstances, once the notice is posted, the case will be closed.

NLRB Regional Offices will provide employers with a notice poster at no charge, or the notice may be downloaded from the NLRB’s website. In addition, if 20% or more of an employer’s workers are not proficient in English, a translated version must be posted. Translated versions will also be available from the NLRB.
 

On August 17, 2011, the New York City Council passed an amendment to the New York City Human Rights Law which will impose a higher burden on employers who assert that accommodating an employee’s or prospective employee’s religious observance or practice would constitute an “undue hardship.”

The amendment defines “undue hardship” as “requiring significant expense or difficulty (including a significant interference with the safe or efficient operation of the workplace or a violation of a bona fide seniority system).” The amendment also lists various factors that will be considered in determining whether the accommodation constitutes an undue economic hardship such as:

(i) the identifiable cost of the accommodation, including the costs of loss of productivity and of retaining or hiring employees or transferring employees from one facility to another, in relation to the size and operating cost of the employer;
(ii) the number of individuals who will need the particular accommodation to a sincerely held religious observance or practice; and
(iii) the degree to which the geographic separateness or administrative or fiscal relationship of the employer’s facilities (for employers with multiple facilities) will make the accommodation more difficult or expensive.

An employee or prospective employee is still required to show that the requested accommodation does not prevent him or her from performing the essential functions of the position.

Once Mayor Bloomberg signs the bill, the law will take effect immediately, impacting New York City employers and non-resident employers who may have employees working in New York City. Employers should review their job descriptions to ensure that the essential functions of the position are accurately described. Employers who have received religious accommodation requests should engage in an interactive process with the employee and use the above factors as parameters for granting or denying a request.
 

OSHA recently released a free application for mobile devices that is intended to enable workers and supervisors to monitor the heat index at their work sites in order to prevent heat-related illnesses. The Secretary of Labor, Hilda Solis commented, “Summer heat presents a serious issue that affects some of the most vulnerable workers in our country, and education is critical to keeping them safe.” The application, which is available in English and Spanish, combines heat index data from the U.S. National Oceanic and Atmospheric Administration with the user’s location to determine necessary protective measures. The application also provides information for supervisors on how to gradually build up the workload for employees and tips on identifying signs and symptoms of heat-related illnesses. The application further permits users to contact OSHA directly. The application is designed for devices using an Android platform. OSHA intends to release versions for BlackBerry and iPhone users shortly.

OSHA’s renewed focus on heat-related illnesses is a good reminder that the law generally requires employers to take various proactive measures to protect employees working in the heat, including, but not limited to, providing plenty of water, scheduling rests breaks in the shade or air-conditioned spaces, planning heavy work early in the day, preparing for medical emergencies, gradually building up work for new employees, and training employees on hazards related to heat illnesses. Information for employers about using the heat index to calculate and address risks posed to workers also is available through OSHA's new Web-based tool "Using the Heat Index: Employer Guidance."  OSHA's other educational and training tools about heat illnesses prevention, available in English and Spanish, can be found here. 
 

Earlier this month OSHA announced that it will restructure the agency’s Whistleblower Protection Program.  The changes come in response to a Government Accounting Office report that was critical of the way OSHA responded to whistleblower complaints (including inconsistent practices at the Regional level and the need for more training of inspectors).  In response, OSHA has revamped the program to include the following changes: (1) a requirement that investigators interview the complainant in all cases; (2) having the program report directly to the Assistant Secretary; (3) several new training initiatives (including a national whistleblower training conference in September which will be attended by all whistleblower investigators; and (4) issuing a new edition of the Whistleblower Investigations Manual that updates current procedures and includes information on the new laws enacted (the manual was last updated in 2003).

The agency has also made a $6.1 million budget request for fiscal year 2012 to add 45 new whistleblower investigators.  The significant backlog of cases in its system is a recurring criticism of OSHA’s program.  David Michaels, the Assistant Secretary for Occupational Safety and Health, announced that the agency has eliminated the backlog of 150+ appeals and that the changes just announced should make the initial complaint intake and case processing more efficient.
 

The issue of whether to compensate an employee for commuting time can be a difficult one where the employee does not have a single standard work location to which he reports. When the employee’s home base is his home, and he performs work at home each day before he gets on the road, is he entitled to be compensated for all time spent commuting between his home and various work sites? The United States Court of Appeals for the Second Circuit recently held no – at least not when the employee is not required to perform the home tasks immediately preceding or following required travel to other work sites.

The case was brought by a former employee of Black & Decker whose responsibilities included merchandising and marketing Black & Decker products at six Home Depot stores which were located between 20 minutes and three hours from his home by car. Black & Decker’s travel policy, adopted pursuant to a USDOL opinion letter, only paid for travel time going to a first store of the day or returning home from the last store of the day in excess of 60 miles (converted in practice to travel in excess of 60 minutes). So travel of 1.5 hours at the end of the day would only be compensated with half an hour of pay.
 

The employee performed a variety of administrative tasks at his home such as sending and answering e-mails and voice mails, reviewing sales reports, organizing materials and making displays and signs. He claimed that he spent 15-30 minutes before he left home and 15-30 minutes after he returned home each day performing these administrative tasks. Black & Decker contended the tasks did not have to be performed at his home or at any particular time of the day. There was no dispute that the employee was compensated for performing the tasks.

The employee argued that he because he performed these tasks immediately prior to and immediately subsequent to traveling to the Home Depot stores, he was entitled to compensation for all time spent traveling under something known as the “continuous work day” rule. This rule defines the workday as the period between the start and completion on the same workday of the employee’s principal activities. Under this rule, once an employee commences principal activities, or activities which are integral and indispensable to principal activities, all time during the same work day is compensable. The employee argued that the continuous work day rule applied because his work at home prior to traveling to the first store of the day was a principal activity, or at least integral and indispensable to a principal activity, so he was entitled to be compensated for all morning travel time, not just that in excess of 60 minutes. He also argued that his end of day activities extended the continuous workday to include all travel time coming home from his last store of the day.

The Second Circuit disagreed, concluding that the continuous workday rule did not apply. Instead, the Court relied on the well-established general principle that home to job site travel is not compensable. The fact that the employee performed administrative tasks at home at his election, just before and just after traveling, could not turn otherwise non-compensable travel time into compensable time by invoking the continuous work day rule. The Court found no evidence that the employee was required to perform the activities either immediately preceding his morning travel or immediately following his afternoon travel, and that he was free to perform them whenever he wanted and to use time for his own personal activities after performing them rather than getting on the road to a store location. As a result, the employee was not permitted to make the choice himself to perform the activities immediately before and after traveling and then invoke the continuous workday rule to increase his travel time compensation.
 

Every employer, regardless of size, will eventually face the need to investigate a workplace misconduct issue.  Whether necessary to resolve a dispute between coworkers or to address unethical or unlawful behavior (e.g. alleged harassment of recently married same-sex couples), a properly conducted workplace investigation is a critical part of doing business.  Of course, most employers expect their HR professionals to properly handle even the most delicate investigations, and more importantly, protect the organization from potential liability resulting from either the misconduct or the investigation itself. As illustrated in a decision from the United States Court of Appeals for the Sixth Circuit upholding a jury verdict of over $1 million, juries are not reluctant to award plaintiffs substantial punitive and compensatory damage awards when employers fail to conduct proper investigations in response to complaints of workplace discrimination. For these reasons, it is imperative that every organization have a process in place to properly investigate workplace issues.

The most effective workplace investigation policies should require prompt investigation of all suspected misconduct. Employers should investigate a claim of wrongdoing even if a formal complaint is not filed. For example, the obligation to investigate may arise from an informal complaint, anonymous tip, information obtained from non-employees, information obtained during exit interviews, or any other means that brings the matter to the employer’s attention. “It wasn’t in writing,” or “she asked me to keep it confidential,” are not acceptable excuses for failing to conduct an investigation.
 

There are exceptions, of course, for example when the accused employee admits to the allegations right away or when the complaint is very minor, but even in these situations it is advisable to conduct a limited investigation to determine the full scope of the misconduct. At a minimum, conducting an investigation will stop the misconduct if it is occurring, send a message to employees that all workplace misconduct will be taken seriously, create a documented record, and put the organization in a much stronger position to defend against subsequent claims.

Next, select the right person to conduct the investigation. Selecting an individual who is experienced and is neither biased nor perceived as biased is essential to maintaining the integrity of the investigation. The investigator should be empowered to decide who to interview, decide what issues to pursue, engage outside resources if necessary, maintain confidentiality where possible, and be expected to make recommendations to management regarding an appropriate response to the complaint.

Developing a strategic investigation plan helps ensure the investigation is comprehensive and thorough, and substantially increases the probability of identifying material facts necessary to determine appropriate action by the employer. Although workplace investigations often take unanticipated turns, a well-documented plan will provide the road map necessary to accomplish the goals of the investigation. Similarly, properly documenting each interview, including obtaining a confirming signature from the complaining employee, is essential to completing a quality investigation. Documents never have bad memories.

Although it is obviously important for an investigation to be done promptly, it is also critical for the investigator to pursue the investigation wherever the facts may lead. Interviewing additional witnesses, reviewing relevant documents, and re-interviewing witnesses to obtain their response to the statements of others should never be avoided for the sake of expediency.

Quality investigations do not reduce the risk of an employer liability unless they have been properly completed. This requires communicating preliminary findings to the target employee to give the employee the opportunity to provide rebuttal information that may undermine the initial determination or require further investigation. Other essential steps include communicating with the complaining employee once conclusions are reached, administering appropriate discipline (if any), preparing a final investigation report, destroying all preliminary drafts (unless a “litigation hold” is required), maintaining the report in a location separate from the complaining employee’s personnel files, ensuring no retaliation is taken against the complaining employee, and disseminating information received during the investigation on a “need to know basis” only. It is also advisable, depending on the seriousness of the potential misconduct and potential employer liabilities, to have a “fresh set of eyes” independently review the investigator’s preliminary findings.
 

In an earlier post, we discussed how the NLRB is handling social media cases. Three recent cases addressed by the Board’s Division of Advice further illuminate the Agency’s view of cases involving discipline of employees for using social media to discuss matters related to their employment. In all three cases the Division of Advice concluded that complaints should not be issued because the employees did not engage in “concerted activity” protected by Section 7 of the National Labor Relations Act.

In one case, the Division of Advice determined that the employer lawfully terminated a bartender after she complained on her Facebook page that she had gone five years without a raise and was not able to share in the tips waitresses were receiving. According to the Advice memorandum, she further stated that she hoped her employer’s customers would “choke on glass after they drove home drunk.”
 

The Division of Advice noted that the test for concerted activity is whether the activity is “engaged in with or on the authority of other employees.” In addition, activity may be deemed concerted when it is the “logical outgrowth of concerns expressed by the employees collectively.” In this case, however, there was no evidence of concerted activity because the posting involved a discussion between the bartender and a non-employee, and there had been no employee meetings over the issues of tipping and raises. Nor did the Facebook communication grow out of any prior communication between employees at the establishment.

In another Advice Memorandum, the Division of Advice concluded that a non-profit residential home lawfully terminated an employee who posted several comments on her Facebook Wall about her work and her patients. According to the Advice memorandum, the employee commented that it was “spooky” working at night in a “mental institution” and that she was unsure if a resident was hearing voices. The Division of Advice found no concerted activity in the postings because they were made solely to non-employees. Moreover, they did not involve any terms and conditions of employment. Rather, the employee was merely communicating to non-employees about what was occurring at work.

Finally, the Division of Advice also issued a Memorandum in a case involving Wal-Mart. According to the memorandum, the employee posted the comment “Wuck Falmart” on her Facebook page. She also commented about “tyranny” in the store, including complaints about an Assistant Manager. Several co-workers responded to the complaints. For example, one thought the comments were humorous and another could not understand why the employee was so “wound up.” The employee received a one day suspension for the posting. The Division of Advice recommended the Board not issue a complaint because the employee was only airing an individual gripe as opposed to a complaint on behalf of others. Because the comments were limited to one person’s issues, there was no group action that could be considered protected concerted activity.

These cases stand in contrast to two cases we reported on earlier where complaints were issued. In those cases, the employees posted critical comments about working conditions, and the complaints involved communication with other employees who shared or supported the substance of the comments.
 

The Wage & Hour Defense Institute (WHDI) of the Litigation Counsel of America is an invitation only group comprised of highly talented and experienced wage and hour defense attorneys from across the United States. To further its goal of being a resource for employers, the WHDI annually updates its State-By-State Wage and Hour Law Summary. The Summary is an excellent reference tool for employers with employees in multiple states. The Summary  addresses multiple topics on a state-by-state basis, including whether each state: (1) follows the federal exemptions; (2) uses special overtime rules; (3) has a higher minimum wage rate; (4) accepts the fluctuating work week method for calculating overtime; and (5) has meal and/or rest period rules. A copy of the Summary is available here.

The WHDI serves as a nationwide network and meeting ground for top-tier practitioners to engage in professional development in what has become a highly nuanced area of the law, and to become an established resource for employers on wage and hour matters. Each attorney was selected for membership in the WHDI based on his or her individual skills and experience representing management in the defense of wage and hour litigation. WHDI members also actively counsel employers on classification determinations and payroll practices to proactively avoid litigation, using tools such as “audits” to examine an employees’ classification as exempt or non-exempt or whether certain activities are compensable or non-compensable and whether overtime has been properly calculated. The Institute holds periodic conferences, meetings and colloquia for purposes of advancing defense techniques, methods and approaches, and broadening its members’ role and influence in wage and hour law and policy.

Many employers are justifiably confused as to whether they may accept a receipt notice showing that an employee has applied for a particular document that is acceptable for I-9 employment eligibility verification purposes. With U.S. Immigration and Customs Enforcement (“ICE”) serving an additional 1,000 Notices of Inspection to employers for I-9 audits in June 2011 alone, it is a good time to refresh your understanding about the use of receipts for initial verification, reverification and to correct errors found in the course of self-audits.

As a general rule, a receipt notice showing an application for an initial period of employment or for an extension of an expiring employment authorization period is not acceptable during the initial I-9 verification or a subsequent reverification. There are, however, exceptions. An employer must accept a receipt during the I-9 process in place of one of the otherwise accepted documents – known as a List A, List B or a List C document – set forth on the instructions accompanying the Form I-9 in the following circumstances:
 

1. Any employee may present a receipt showing that an application for a replacement List A, B, or C document has been submitted because the document was lost, stolen, or damaged. The receipt notice serves to verify the individual’s employment authorization for 90 days from the date of hire, or, in the case of reverification, the date the employment authorization expires. Upon the expiration of the receipt period, the employee must present the actual document for which the receipt was obtained.
2. An employee who is a lawful permanent resident may present a receipt that constitutes an arrival card which is a portion of Form I-94 or Form I-94A which contains a temporary I-551 stamp (and photograph). This temporary I-551 stamp placed on the I-94 card, which is found within the employee’s passport, is considered the receipt. This type of receipt is considered valid as long as it is submitted for I-9 purposes before the expiration date listed on the temporary I-551 stamp. If there is no listed expiration date on the I-551 stamp, the receipt expires within one year from the date of issue.
3. An employee who is a refugee may present a receipt that constitutes Form I-94 or Form I-94A with an unexpired refugee admission stamp. The receipt notice serves to verify the individual’s employment authorization for 90 days from the date of hire, or, in the case of reverification, the date the employment authorization expires. Upon the expiration of the receipt period, the employee must present an unexpired employment authorization document (i.e., Form I-766, Form I-688B) or an unrestricted Social Security Card combined with a valid List B document.
4. Certain employees who hold non-immigrant visas and who are authorized to work for a specific employer incident to status (e.g., E, H, L, O, P, and TN) may continue to work for their sponsoring employers up to 240 days following the expiration of their authorized period of stay. In order for this rule to apply, the application or petition for an extension of status must be filed in good faith and before the expiration of the original status. In these cases, a USCIS receipt showing that a timely extension application or petition was filed (i.e., Form I-797) must be accepted for reverification purposes.
5. Individuals holding valid H-1B visas for another employer may “port” or work for another employer once the new or prospective employer has timely filed an H-1B portability petition on behalf of the individual. An application is generally considered “filed” once it is accepted for processing by the U.S. Citizenship and Immigration Services (USCIS). A copy of the Receipt Notice for the filed H-1B portability petition, together with the copy of the alien’s unexpired I-94 card can be accepted as evidence of employment authorization for employment verification purposes. Once the H-1B portability petition is approved, the employer should update the I-9 by reviewing the passport with the newly issued H-1B Approval Notice for the employee at issue.
6. In April 2008, USCIS issued a rule specifically pertaining to F-1 students. Under the rule, if a student in lawful F-1 status is the beneficiary of a timely filed H-1B petition requesting a change of status (from F-1 to H-1B), the student’s status is extended, along with any grant of optional practical training (“OPT”) work authorization, until October 1. In these cases, the employer may accept the expired OPT work authorization document combined with an endorsed Form I-20 that demonstrates that the student’s employment work authorization – OPT – has been extended and is still valid, and the USCIS Receipt Notice (Form I-797) showing receipt of the timely filed H-1B Petition.

Employers should also be aware of the following additional considerations:

• A receipt showing an employee has applied for an employment authorization document – whether it is for an initial grant of work authorization or a renewal – cannot be accepted as sufficient evidence of work authorization for I-9 purposes.
• A receipt is never acceptable for employment lasting less than 3 days.
• An employer’s failure to honor a receipt in one of the circumstances or exceptions set forth above may constitute document abuse and is prohibited under the Immigration and Nationality Act. 

The Securities and Exchange Commission’s final rules (the “Rules”) clarifying Dodd-Frank whistleblower rewards and protections take effect on August 12, 2011. The Rules govern the payment of rewards to eligible individuals who report violations of the federal securities laws which lead to a successful enforcement action by the SEC in which monetary sanctions of over $1 million are collected. The SEC promulgated the Rules pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”), which requires the SEC, in certain cases, to award to qualifying whistleblowers no less than 10%, and no greater than 30%, of the total monetary sanctions collected because of the whistleblower’s information. The Rules detail, among other things, how the SEC will evaluate an individual’s right to a reward and, if qualified, the amount to be awarded. Significant aspects of the Rules are summarized in brief below.

Notably, a whistleblower can submit information to the SEC anonymously through counsel, and a whistleblower’s identity is kept confidential. Moreover, a whistleblower need not have “clean hands” to receive an award. While the culpability or involvement of a whistleblower is a factor in determining the amount of an award, a culpable whistleblower, in the absence of a criminal conviction, is not per se precluded from receiving an award.

The Rules also clarify the anti-retaliation protections afforded whistleblowers under Dodd-Frank. Whistleblowers who do not qualify for a reward are still protected by the anti-retaliation provisions as long as the individual has a “reasonable belief that the information he is providing relates to a possible securities law violation … that has occurred, is ongoing, or is about to occur.” 

Whistleblowers are not required to report their concerns internally to their employers before making a report to the SEC. The Rules do, however, include incentives intended to encourage whistleblowers to use their companies’ internal compliance and reporting systems. For example, one of the factors the SEC will consider in determining whether to increase the amount of the award, is whether the whistleblower participated in his or her company’s internal reporting system. Similarly, a factor in determining whether to decrease the amount of the whistleblower award is whether the whistleblower undermined the integrity of the company’s internal compliance and reporting system. In addition, a whistleblower remains eligible to receive an award for his or her original information, even if he or she first reports the possible violation to the company, and the company subsequently reports the information to the SEC or provides the SEC with the results of an internal investigation which was prompted by the whistleblower’s information. 

The SEC states in the Rules that it is not seeking to undermine effective company processes for receiving reports on possible violations. In appropriate cases, it will contact the company after receiving a complaint, describe the nature of the allegations, and give the company an opportunity to investigate the matter and report back. Among other factors the SEC will consider in determining whether to give a company this opportunity are the company’s existing culture related to corporate governance, and the company’s internal compliance programs, including what role, if any, internal compliance had in bringing the information to management’s or the SEC’s attention.

In light of these factors alone, companies should evaluate their current internal reporting processes and policies to ensure that they effectively encourage employees to report their concerns about potential violations and misconduct through internal processes, to minimize the risk of being blindsided by an enforcement action. An effective internal reporting system will: be uncomplicated and non-threatening; include a process for reporting and receiving concerns about possible violations, including anonymous submissions; and ensure that all allegations of misconduct are taken seriously and addressed in a timely manner. Companies should routinely train their employees on how to report potential violations using the company’s internal reporting system, promote the use of their internal compliance programs, and train supervisors how to respond to reports of potential violations.