Legal Knowledge Center

The Georgia Restaurant Association’s top-notch team of member attorneys take the guesswork out of the multitude of laws and regulations affecting restaurants. Many resources, including a library of articles on legal issues are available to members only.

Also, the National Restaurant Association offers a Legal Problem Solver with easy-to-understand summaries of key federal laws and regulations available to GRA/NRA members for free online.

Comp Time Bill Passes House, Heads for Senate

21 May 2013 3:28 PM | Anonymous member (Administrator)

Author: Eric R. Magnus

Jackson Lewis LLP

The U.S. House of Representatives has passed the “Working Families Flexibility Act of 2013” (H.R. 1406), which would amend the Fair Labor Standards Act of 1938 to allow private employers to provide compensatory time off to employees in lieu of overtime under certain conditions. Representative Martha Roby (R-Alabama) introduced the legislation. The bill was received in the Senate and referred to the Committee on Health, Education, Labor, and Pensions.

The legislation would permit employers to provide compensatory time in lieu of paid overtime at a rate of 1-1/2 hours per hour of employment for which overtime would be required. Employers could provide compensatory time only in accordance with an applicable collective bargaining agreement, or, if the employee is not represented by a union, only if the employer and the employee entered into a knowing and voluntary written agreement providing for such compensatory time before the performance of any work. The agreement could not be required as a condition of employment.

Under the proposed legislation, employers must give employees 30 days’ notice before ending a compensatory time program, and employees, at any time, may request in writing to be paid for any accrued, but unused, compensatory time. Such payments must be made within 30 days of receiving a request.

The bill would prohibit employees from accruing more than 160 hours of compensatory time and, after the end of each calendar year, would require employers to pay to employees for any unused compensatory time accrued during the preceding year.

Employers also would have to pay accrued compensatory time upon termination of employment. Payments for compensatory time would be made at the employee’s regular rate or final rate of pay, whichever is higher.

Employers would be prohibited from interfering with employees’ rights under the proposed legislation or from requiring employees to use compensatory time. Employers that violated the law would be liable for the amount of the compensation rate for each hour of accrued compensatory time, plus an additional equal amount as liquidated damages.

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What Employers Need to Know About The New Form I-9

20 Mar 2013 9:57 AM | Anonymous member (Administrator)

Author: Timothy M. Wheelwright
Kuck Immigration Partners

On March 8, 2013, U.S. Citizenship and Immigration Services (USCIS) announced that effective immediately, all NEW hires by U.S. employers should fill out the new version of Form I-9, which is identified in the lower, left-hand corner of the form with the label “Form I-9 03/08/13 N”. Starting May 7, 2013, use of the new version of the form is mandatory.

U.S. employers need to know the following about the new Form I-9:

Official Instructions. The new Form I-9 now has 9 pages: Official Instructions (pages 1-6), the form on which the employee and employer enter data (pages 7-8), and the List of Acceptable Documents (page 9). The official instructions have been expanded from 2 to 6 pages. Anyone who is involved with a company’s I-9 process should carefully read these instructions before beginning to use the new form. These instructions and the List of Acceptable Documents must be made available to the employee while he or she is completing the form.
Other Resources. Anyone involved with a company’s I-9 process should also have access to the updated Handbook for Employers: Guidance for Completing Form I-9 (Employment Verification Form) and USCIS’s online resource for employers called I-9 Central. These and the official instructions are excellent resources that should be consulted often to ensure compliance.
Only for New Hires. Do not require current employees for whom there is already a properly completed Form I-9 on file to complete the new Form I-9. Doing so could violate the antidiscrimination laws.

Section1. This is found on page 7 and is completed by the employee:
• Although the employee completes this section, the employer is responsible for ensuring that it is completed properly and timely.
• It must be completed and signed by the employee no later than the first day of employment, but not before accepting a job offer.
• If the employee has 2 last names, enter both names under Last Name.
• If the employee has not used any other names, enter “N/A” under Other Names Used.
• No P.O. Box should be entered under Address and only border commuters from Canada or Mexico may enter an international address. (We should not have border commuters in Utah, Georgia, or North Carolina.)
• The birthdate should be entered in the format MM/DD/YYYY.
• The employee is not required to provide his or her Social Security number unless the employer participates in E-Verify, in which case providing it is mandatory.
• The form now requests the employee’s e-mail address and telephone number, however, the employee is not required to provide this information.
• If the employee checks the box next to A noncitizen national of the United States, consider directing their attention to page 2 of the instructions, which identifies who may check this box.
• If the employee checks the box next to An alien authorized to work until, he or she must enter either their Alien Registration Number/USCIS Number or their Form I-94 Admission Number. If they obtained their admission number in connection with their arrival in the United States, they must also insert their foreign passport number and country of issuance. If they obtained their admission number some other way, they may insert “N/A” in these spaces.
• This is new and very important: If the employee checks the box next to An alien authorized to work until and inserts an expiration date, the employer must track that expiration date and re-verify employment authorization on or before the date provided. This is in addition to its duty to track the expiration date of any List A document (other than a U.S. passport or Permanent Resident Card). If both Sections 1 and 2 indicate expiration dates triggering the re-verification requirement, the employer should re-verify by the earlier date.
• There are special instructions on page 2 about the circumstances under which the Preparer and/or Translator Certification must be completed. I generally recommend that the employer should not fill out any portion of Section 1. If it does, however, the employer’s representative must complete this preparer certification.
• There are special instructions on page 2 for how Section 1 should be prepared for minors and certain employees with disabilities.

Section 2. This is found on page 8 and is completed by the employer:
• Section 2 must be completed within 3 business days of the employee’s first date of employment, unless the employee is hired to work less than 3 days, in which case this section must be completed on the first day of employment.
• On page 3 you will find a helpful 7-step process the employer should follow to complete this section. The instructions emphasize that the examiner of the documents and the employee must be physically present during the examination of the employee’s original documents and that the person who examines the documents must be the same person who signs Section 2.
• Do not forget to insert the employee’s full name near the top of the page. This is a new field that I suspect many employers are going to overlook.
• This section has been significantly improved to clearly identify the information from the original documents reviewed that must be recorded on the form, including Document Title, Issuing Authority, Document Number, and Expiration Date (if any).
• There is now a list of the Social Security cards that may not be accepted under List C of the List of Acceptable Documents (page 9).
• Under Certification, do not forget to enter the employee’s first day of employment. (For temporary staffing agencies, insert the first day the employee was placed in a job pool and recruiters and recruiters for a fee may leave this space blank.)
• On pages 3-4 you will find useful and detailed instructions about photocopying the documents presented, unexpired documents, and receipts, including what receipts an employer may accept and how to properly annotate the I-9 form when an employee presents an acceptable receipt. Review these important instructions carefully.

Section 3. This is also found on page 8 and is to be completed by the employer when re-verifying that an employee is authorized to work either because their List A or C document (other than a U.S. passport or Permanent Resident Card) has expired or the employee has been rehired within 3 years of the date the Form I-9 was originally completed:
• On pages 3-4 you will find useful and detailed instructions about re-verifications and rehires.
• An important feature of the new Form I-9 is the instructions that employers must now re-verify employment authorization when an employee provides an employment authorization expiration date in Section 1 and that if both Sections 1 and 2 indicate expiration dates triggering the re-verification requirement, the employer should re-verify by the earlier date.
• Although the instructions say that when re-verifying employers have the option of completing Section 3 of a new Form I-9 or Section 3 of the previously completed Form I-9, after May 7, 2013, when the new Form I-9 becomes mandatory, it appears to me the employer’s only option would be to complete Section 3 of the new Form I-9. The instructions state that the employer may attach just the page containing Section 3 (page 8), with the employee’s name entered at the top of the page, to the employee’s original Form I-9. Do not discard the previously-completed Form I-9.

Retention Requirements. The employer is required to retain only pages 7-8, which are the pages of the form on which the employee and employer enter data. If copies of the documentation presented by the employee are made, those copies must also be kept with the forms. The employer must have a properly completed Form I-9 for every current employee who was hired after November 6, 1986. Once that individual’s employment ends, the employer must retain the form and, if applicable, copies of the supporting documents for 3 years after the date of hire or 1 year after the date of termination, whichever is later. I strongly recommend that employers implement a method for tracking these dates and that it dispose of these records as soon as permitted.

Photocopies. Making photocopies of the supporting documents is no substitute for the employer properly completing Section 2 and it certainly cannot take the place of completing Form I-9. The single most important protection a company can have against a claim that it has knowingly hired an undocumented worker is to have a properly completed Form I-9 for each one of its employees hired after November 6, 1986.

E-Verify. Similarly, even if a company uses E-Verify, it must still have a properly completed Form I-9 for its current employees.

Potential Penalties. A company who fails to use the new version of Form I-9, to ensure that its employee properly completes Section 1, or to properly complete Sections 2 or 3 of the new Form I-9 is subject to civil fines ranging from $110 to $1100 per form. The United States government is aggressively checking compliance through worksite audits conducted by field agents and forensic auditors. I strongly encourage all employers to internally audit and assess their compliance utilizing the services of an attorney who has experience conducting such audits.

Do not delay your organization’s implementation of the new Form I-9.

**Note**: The foregoing is not intended to be legal advice, nor should it be construed as such. Each employer should consult with competent legal counsel about its particular circumstances and how best to implement the new Form I-9.

Tim Wheelwright is a partner in the Salt Lake City office of Kuck Immigration Partners, a national immigration law firm. He handles both routine and complex immigration matters for companies and individuals. Follow him on Twitter at @TimWheelwright or reach him at twheelwright@immigration.net or (801) 989-5702.

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New Form I-9 Released

12 Mar 2013 11:18 AM | Anonymous member (Administrator)

Author: Laleh Sharifi

Smith, Gambrell & Russell, LLP

On March 8, 2013, the U.S. Citizenship and Immigration Services ("USCIS") released a new Employment Eligibility Verification Form
I-9. Employers must use the new 03/08/13 version of Form I-9 when hiring workers to verify their identity and employment authorization.

Employers may continue to use previously valid Forms I-9 for 60 days until May 7, 2013. After May 7, 2013, employers must only use the new Form I-9.

The following are some of the changes to the Form I-9:
• Extended to two pages;
• Expanded details in instructions;
• Added fields for e-mail address, phone number and foreign passport in Section 1.

If you have any questions about this Client Alert, please contact Laleh Sharifi at lsharifi@sgrlaw.com.

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Time to Revise Your Employee Handbook

22 Jan 2013 1:18 PM | Anonymous member (Administrator)

Author: Evan M. Rosen, Esq.

EPSTEIN BECKER GREEN, P.C.

Several policies in your employee handbook may be outdated and unlawful. With the turn of the year, it is an excellent opportunity to address these issues before it becomes a significant problem.

Employee handbooks are supposed to serve as an effective tool to communicate policies and procedures to your employees, while simultaneously establishing certain affirmative defenses that can protect your company during litigation. Unfortunately, many hospitality employers are finding that their handbooks are being closely scrutinized by plaintiffs’ attorneys and government agencies, such as the National Labor Relations Board and the Equal Employment Opportunity Commission. Instead of serving as a shield from liability, the handbook is becoming one of the chief means of establishing liability against you.
Here are eight provisions to address in your employee handbook to protect your company from liability.

1) Social Media

Technology continues to improve exponentially and your workforce is part of that trend. They are likely spending time on Facebook, Twitter, blogs, and other social media outlets. It is, therefore, critical that you have a policy regarding what, if anything, employees may discuss on social media platforms regarding your company and its employees, managers, and customer.

Many social media policies, however, are overly broad and therefore violate Section 7 of the National Labor Relations Act (the “Act”). The Act gives employees the right to engage in concerted, protected activity, or in other words, to take action as a group to address their terms and conditions of employment. The National Labor Relations Board (the “Board”) has interpreted it to mean that a company cannot discipline or terminate an employee who engages in a discussion with other employees on social media about their terms or conditions of employment, even if such discussions would otherwise violate your policy. Moreover, the Board has ruled that many such policies are unlawful and need to be rescinded or rewritten. Accordingly, it is important to review your social media policy to make sure that it does not violate the Act.

2) Family and Medical Leave Act (FMLA)

A few years ago, the Department of Labor issued new regulations regarding the FMLA that extended FMLA protections to military caregivers and qualifying exigency leaves. Under the new regulations, military caregivers have the right to take up to 26 weeks of protected leave during a 12 month period. The new regulations also contain provisions about, among other things, continuing and periodic treatment, paid leave, notices, spouses working for the same employers, waivers of past claims, intermittent leave, light duty, bonuses, and contact with health providers.

3) At-Will Employment

It is important that you include an at-will employment provision in conspicuous locations throughout your handbook. Failure to do so could give rise to a claim that your handbook is a contractual obligation.

Recently, the Board has taken the position that certain at-will employment provisions violate the Act, particularly if the provision states that at-will employment cannot be changed without the sole and exclusive authority of a particular manager.

4) Health Insurance

Your handbook may be outdated based on the passage of the Affordable Care Act. For example, the Affordable Care Act requires that health insurance be available for dependents up to the age of 26. In addition, eligibility periods cannot be longer than 90 days from the start of employment. If you have more than 50 full-time employees or full-time equivalents, there are also additional requirements regarding your coverage that you should address.

5) Anti-Harassment, Anti-Retaliation

A well-drafted anti-harassment and anti-retaliation policy (along with an equal employment opportunity policy) is critical to providing your company with an affirmative defense against charges of discrimination alleging harassment. The policy should provide a list of protected categories (including the newest ones, such as Genetic and Carrier Status), a complaint procedure that includes multiple avenues to whom an employee can complain, and a clear prohibition on retaliation.

6) Reasonable Accommodation

The Americans with Disabilities Act (“ADA”) was amended a couple of years ago and the amendments greatly expand the definition of disability. Previously, employers did not have to worry quite as much about this Act because it was relatively easy to argue that the plaintiff was not disabled. But under the amended act, this is no longer the case. Accordingly, employers will have to spend more time addressing requests for reasonable accommodation.

A request for reasonable accommodation can take many forms. For example, it can be a simple request to take a 5 minute break every few hours, to a more burdensome request of asking for a leave of absence. Your handbook should note that your company complies with the ADA and it should explain the procedures for requesting accommodation.

7) Confidential Information

The Board has taken an aggressive approach in invalidating policies that protect confidential information if they are overly broad. A company may not require that employees keep information confidential if it is relevant to their concerted, protected activity. For example, the Board has taken the position that a policy is unlawful if it prohibits employees from discussing their wages. Likewise, depending on the circumstance, a policy prohibiting employees from discussing the contents of an internal investigation may be unlawful.

8) FLSA Safe Harbor

The restaurant industry continues to be plagued by wage and hour lawsuits. One way to mitigate against these lawsuits is to include a provision in your handbook stating that employees should let the company know if their paycheck is incorrect and/or if an improper deduction was taken. Then, the company will investigate such claims and promptly reimburse the employee for any errors.

Evan M. Rosen, Esq. is a Partner in Epstein Becker & Green, P.C.’s Atlanta office. He specializes in labor and employment law, with a focus on the hospitality industry. He can be reached at (404) 869-5325 or at erosen@ebglaw.com.

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Health Care Reform Update: IRS Proposes Regulations on Employer Penalty

15 Jan 2013 3:45 PM | Anonymous member (Administrator)

Author: Eric Magnus
Jackson Lewis LLP

The Internal Revenue Service has released proposed regulations on the health care reform employer “shared responsibility” penalty provision. This is the penalty on “large” employers (those with at least 50 full-time or full-time equivalent employees) that do not provide affordable minimum essential coverage for full-time employees and their dependents and have at least one full-time employee who receives subsidized Exchange coverage (new Internal Revenue Code section 4980H, enacted as part of the Patient Protection and Affordable Care Act of 2010 as amended by the Health Care and Education Reconciliation Act of 2010). The IRS also posted on its website a set of related questions and answers.

Employers Affected

An employer meets the penalty provision’s large employer threshold if it employed, on average, at least 50 full-time or full-time equivalent employees in the prior calendar year. Thus, for 2014, the first year the penalty is effective, an employer would consider the average number of such employees it had during 2013 to determine whether it is a covered large employer. The proposed regulations include a transition rule under which employers may use any consecutive six-month period in 2013, instead of the full year, to calculate the average number of employees.

A full-time employee is one who is employed by the employer an average of 30 hours per week. Part-time employees count, too, taking into account the number of full-time equivalents: For a given month, add the number of hours for all part-time employees (counting no more than 120 hours for any one employee) and divide by 120. Count all hours worked and all hours for which payment is made or due for vacation, illness, holiday, incapacity, layoff, jury duty, military duty, or leave of absence. Notice 2011-36 had limited the period of leave that must be included to 160 hours but the proposed regulations eliminate this limitation.

The proposed regulations clarify that the IRS’s safe harbor for determining full-time status (i.e., using the look-back/stability period approach) will not apply for purposes of determining whether an employer meets the threshold of 50 full-time employees. Instead, whether an employer is a large employer for a given year will be determined by calculating employees’ actual hours of service in the immediately preceding year. Equivalency rules may be used for employees not paid on an hourly basis. An entity not in existence in the preceding year may be a large employer in its first year if it is reasonably expected to employ an average of at least 50 full-time employees during its first year. Special hours-counting rules are proposed for educational institutions, employees paid on a commission basis, and other circumstances.

Whether a worker is an employee of a particular employer will be based on the long-standing common law principle that, if a service recipient has the right to direct and control how a worker performs services, that service recipient is the worker’s employer. The proposed regulations also reiterate that controlled group rules apply for purposes of identifying the employer. Thus, all common law employees of all entities that are part of the same controlled group or affiliated service group must be counted to determine whether the threshold of 50 full-time employees is met.

Assessable Penalty for Affected Employers

For a given month beginning after 2013, if an employer does not offer minimum essential coverage to “substantially all” of its full-time employees and their dependents and a full-time employee obtains subsidized Exchange coverage, the employer must pay a penalty equal to $166.67 multiplied by the number of its full-time employees in excess of 30. Under the proposed regulations, “substantially all” means all but five percent of full-time employees or, if greater, five full-time employees. The proposed regulations define “dependent” as a child, within the meaning of Code 152(f)(1), who is under age 26. (Thus, a spouse is not a dependent.) The proposed regulations offer transitional relief (only for 2014) for employers that do not currently provide dependent coverage. Any employer that takes steps during its plan year that begins in 2014 toward offering dependent coverage will not be liable for penalties solely on account of its failure to offer dependent coverage for that plan year. The proposed rules also explain that the 30-employee reduction used when calculating this penalty is applied on a controlled group basis so that each member company reduces its number of full-time employees by a ratable share of 30.

If an employer offers minimum essential coverage to substantially all of its full-time employees and their dependents, but a full-time employee nevertheless obtains subsidized Exchange coverage (i.e., because the employer’s coverage fails to meet the minimum value or affordability test), the employer must pay a penalty equal to the lesser of the penalty determined in the preceding paragraph or $250 multiplied by the number of full-time employees who are certified as having subsidized Exchange coverage for the month.

Since no penalty is triggered unless at least one full-time employee obtains subsidized Exchange coverage, it is important to know whether a full-time employee can obtain subsidized Exchange coverage. An employee can obtain subsidized Exchange coverage only if his or her household income is between 100 percent and 400 percent of the federal poverty line, he or she enrolls in Exchange coverage and is not eligible for Medicaid (or other government coverage), and either no employer coverage is offered or the employer coverage offered fails to meet either a minimum value test or an affordability test:

• Employer coverage meets the minimum value test if it covers at least 60 percent of the total allowed cost of benefits that are expected to be incurred under the plan. The Department of Health and Human Services is working with IRS to develop a calculator that employers may use to determine whether this test is met.
• Employer coverage meets the affordability test if the employee is required to pay no more than 9.5% of his household income for self-only coverage. Since employers have no practical way of knowing what an employee’s household income is, the IRS previously stated that employers could use an employee’s W-2 reported wages as a safe harbor. The proposed regulations explain how that safe harbor would apply, including how it would apply to partial years worked. The W-2 safe harbor will be very useful to most employers, but the proposed regulations also offer two additional safe harbors that employers may use to determine affordability: one based on monthly rate of pay (i.e., coverage is affordable if the employee’s monthly cost for self-only coverage does not exceed 9.5% of his monthly rate of pay) and the other based on eligibility for Medicaid (i.e., coverage is affordable if the employee’s cost for self-only coverage does not exceed 9.5% of the federal poverty line for a single individual).

If an employee elects coverage under an employer’s group health plan, the employee cannot qualify for subsidized Exchange coverage even if the employer coverage fails the minimum value or affordability test. However, providing mandatory group health coverage that fails the minimum value or affordability test will not prevent an employee from obtaining subsidized Exchange coverage.

The proposed regulations retain the look-back/stability period safe harbor method provided in prior guidance for determining which employees are full-time for purposes of the penalty calculation. Thus, an employer can use a look-back period of up to 12 months to determine whether an on-going employee (i.e., one employed for at least the length of the look-back measurement period selected) is a full-time employee. If an employer uses a look-back/stability period for its on-going employees, it also can use the look-back/stability period for new and seasonal employees. The proposed regulations include additional special rules for a new variable-hour employee or seasonal employee whose status changes during the look-back measurement period, for rehired employees and employees returning from unpaid leaves of absence, for employees of temporary agencies, and for other special circumstances.

The proposed regulations assure that an employer will (a) receive certification of an employee’s receipt of subsidized Exchange coverage and (b) have an opportunity to respond regarding application of the penalty before IRS actually assesses a penalty in connection with that employee.

Recordkeeping obviously is important both for compliance (existing law already requires substantial recordkeeping for tax purposes) and to substantiate any defense to a penalty.

Opportunity to Comment on Proposed Regulations

Employers and other stakeholders can help shape final regulations at a public hearing on April 23, 2013, and by submitting written comments by March 18, 2013. In addition, the government also requests comments on the new Code § 6056 employer-reporting requirements and the 90-day waiting period rule.

If you have any questions about health care reform, please feel free to contact Eric Magnus at 404-586-1820.

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Have You Reviewed Your Social Media Policy Lately?

21 Nov 2012 10:59 AM | Kelly Hornbuckle (Administrator)

Authors: Stanford G. Wilson
Sean M. Libby
Elarbee, Thompson, Sapp & Wilson, LLP

In a pair of recent decisions addressing employee social media usage, the National Labor Relations Board (NLRB) has provided useful insight into the types of conduct that can and cannot be prohibited by employers under the National Labor Relations Act (NLRA). With this new guidance in hand, now is a good time to give your social media policy a review or to finally put a policy in place.

The NLRB enforces the provisions of the NLRA, which guarantees employees, in both union and non-union workplaces, the right to discuss the terms and conditions of their employment. Workplace policies that infringe on this right violate the NLRA; but until recently, how the NLRA’s guarantees applied to social media posts was unclear. Recent decisions by the NLRB have, however, done much to clarify the issue. On September 7, 2012, the NLRB released its opinion in Costco Wholesale Corp., 358 NLRB No. 106 (Sept. 7, 2012), which specifically addressed the legality of an employer policy prohibiting certain electronic communications. In Costco, the NLRB ruled that Costco’s policy-prohibiting electronic posts that “damage[d] the Company, defame[d] any individual or damage[d] any person’s reputation”-to be illegal because of its potential to chill employee communications protected by the NLRA. Even though the policy did not explicitly prohibit communications between employees regarding working terms and conditions, the policy could be reasonably construed to prohibit such conduct, which was sufficient to violate the NLRA.

On October 1, 2012, the National Labor Relations Board (NLRB) released another instructive opinion, addressing the legality of a termination based on an employee’s Facebook posts. In Karl Knauz Motors, Inc. d/b/a Knauz BMW and Robert Becker, 358 NLRB No. 164 (Sept. 28, 2012), the NLRB held that an employee’s online activities were not protected by the NLRA, even though they arguably involved concerns over safety at a luxury car dealership. The employee posted photos to his Facebook page showing refreshments served at a sales event at the dealership, which the employee believed were cheap and poorly selected, as well as photos of a Land Rover in a pond-the car was driven into the pond when a customer’s son was allowed to sit in the driver’s seat of the car while it was running. The employee included sarcastic captions along with the photos; for instance, he captioned the photo of the car in the pond “Oops.” After the photos and captions were posted, the dealership terminated the employee and claimed that the photos and captions related to the car in the pond violated the company’s Courtesy policy.
In reaching its decision, the NLRB determined that the Facebook posts about the food at the sales event were protected because they voiced concerns about employment terms affecting all sales employees and other employees voiced similar concerns during a sales meeting. In contrast, the NLRB found that the posts regarding the car in the pond were not protected. The NLRB focused on the fact that the posts contained sarcastic comments and that the photos and captions were not part of a larger conversation amongst employees about working conditions at the dealership. Because the termination was based on the latter posts, it was not a violation of the NLRA.

While the termination was not a violation of the NLRB’s rules, the company’s underlying “Courtesy” policy addressing employee communication was found to be unlawful. According to two members of the NLRB, the language of the “Courtesy” policy could be read to prohibit protest or criticism of company policies or actions and, as a result, violated the NLRA. The company was ordered to edit its policy and distribute its updated policy to employees.

While the Costco and Knauz BMW decisions do not settle the social media policy issue, they offer a useful starting point for drafting or revising a social media policy. Based on the decisions, the NLRA clearly allows for terminations based on social media posts. But, employers must be sure that any such terminations are not based on comments between employees about the terms and conditions of the employees’ employment. Any policy regarding social media and/or employee communication should leave room for such discussions. In fact, to avoid potential liability under the NLRA, employers must be sure that their policies cannot be reasonably read to restrict communications regarding terms and conditions of employment.

For employers struggling to strike the appropriate balance between prohibiting disrespectful and harmful speech and complying with the NLRA, the acting General Counsel of the NLRB issued a report on May 30, 2012, that included a sample social media policy that was found to comply with the NLRA. Worth noting, the policy included specific types of communications that were prohibited (postings involving “discriminatory remarks, harassment and threats of violence or similar inappropriate or unlawful conduct”) and specific types of confidential information that could not be disclosed (“information regarding the development of systems, processes, products, know-how, technology . . .”). Employers hoping to avoid future NLRB complaints should take a similarly specific approach. Additional guidance, as well as the text of the policy, can be found on the NLRB’s website: www.nlrb.gov.

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Is Your Restaurant Ready to Franchise?

25 Oct 2012 2:25 PM | Kelly Hornbuckle (Administrator)

Author: Perry J. McGuire
Smith, Gambrell & Russell, LLP

As a franchise attorney, I am always asked by business owners how they go about determining when it is time to franchise their business. Like any other legal or business question, the answer is generally “it depends.” However, there are a few questions that you can ask yourself to test your readiness.

Before discussing the tests, it would be helpful to know what a franchise is.

Franchising is defined and governed at both the federal and state levels (although Georgia does not have a franchise statute). Thus, for purposes of federal law, there are three factors that will be used to identify a franchise relationship: 1) the right to use a trademark; 2) significant control or assistance; and 3) a required payment. All factors must be present in order for a business relationship to be deemed a “franchise.”

So, here are the questions a potential franchisor needs to ask themselves before going down this path. First, has my business been successful? It is hard to sell a franchise concept to a potential franchisee if the business has not been successful for the owner. This is also important because the franchised business will need to generate enough income to pay a royalty to the franchisor (generally 5-8% of gross sales). Now, something to consider is the increased buying power of multiple units. So, theoretically, increased buying power should lower certain costs for the franchisee, increasing margins which then may be used to assist in paying royalties.

Another question to ask is if there are people wanting to buy your concept. I have seen single unit restaurant owners start successful franchises because they had someone in the wings waiting to buy one. This “ready buyer” helps to fund the initial cost of the franchise because of the upfront franchise fee required by franchisors (generally in the $20k-$30k range).

Do you have the time, talent, and staff to help make franchisees successful? Generally, the founder of the business will be the CEO of the franchise entity and will probably wear many hats. Staff from the original restaurant may be the ones training and supporting/monitoring the franchisees, so you will need the capacity to do so.

One of the myths of franchising is that it requires a huge upfront investment of capital and structure to do it. That is simply not the case. If you have run a successful business and have a passion to grow it, franchising could be the perfect vehicle to do so.

Is Your Restaurant Ready to Franchise?
In my practice, I do not charge for the initial consultation to discuss these questions with you. You may be sitting on a franchise goldmine!

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What’s Your Tsunami?

25 Oct 2012 2:18 PM | Kelly Hornbuckle (Administrator)

Author: Michael (Mike) M. Sullivan, Esq., Taylor English Duma LLP

It seems this new century has been marked by one disaster after another. Beginning with the World Trade Towers in September 2001, Hurricane Katrina in 2005, the BP Gulf Oil Spill in April 2010, through the Tsunami in Northern Japan in early 2011 and the floods in Thailand in October of that same year. But it doesn’t just take a regional or global disaster to present great challenges to your restaurant or food provision business. It could be very local, such as fire or explosion in your restaurant, warehouse or principal facility.

If a catastrophe or major disruption hits my business, what do I do? How do I protect my business against a major catastrophe? What are the legal ramifications if I cannot perform and can’t hold that wedding event at my restaurant, if I can’t cater to that corporate meeting, or if I cannot provide food to my restaurant customers?

Disaster Recovery Plan:

Recovery from disasters, catastrophes or major disruptions to or in your restaurant or provisioning business starts before they occur. It starts with developing a Disaster Recovery Plan. If you are a small business, the Plan can be very simple. If you are a significant restaurant group or food supplier, it could be complex and even drafted by an outside consultant. Here are some simple guidelines.

·         Plan to keep your employees safe from harm. You can do this by asking your insurance broker to have your general liability carrier send a safety specialist to review your place of business. He can tell you if it is up to Code and suggest ways to improve safety, especially in the kitchen area where the majority of fires and explosions happen. (Be sure your general liability insurance gives you the right coverages --- business interruption, etc. --- and in sufficient amounts.)

·         Make a list of your important company and business information: the names and contact information for your managers and employees; insurance policy and insurance broker numbers, etc.   Give a copy to your key employees.

·         Back-up your company computer off-line. There are several inexpensive back-up services (Carbonite, Mozy, etc.) that will back-up your computers automatically during the night.

·         Keep copies of your key documents with an on-line storage service such as Drop Box, Google Drive, etc.

·         In case of a catastrophe or major disruptive event, try to keep your customers and employees up-to-date via social media such as your web site, Facebook and Twitter.

Key Legal Issues:

The general legal rule in the U.S. is that you are excused from performing under a contract if an unforeseen event occurs that makes it “commercially impractical” for you to perform in part or at all. The event has to be major. It can be caused by an act of nature or be man-made. It has to have been reasonably unforeseen. A restaurant that has a significant fire that largely destroys its kitchen can probably use the “commercially impractical” defense to not host this Saturday’s wedding reception, or to not cater that corporate event next week. If you are a food supplier or other provider and your sole or a major manufacturing or processing plant is hit by a tornado, you are probably excused from fulfilling your contracts to supply provisions.. If only a part of your kitchen or processing plant is hit and is off-line, you are legally obligated to take reasonable steps to fulfill your contracts as best you can. The restaurant owner above who had a fire in his kitchen must make reasonable good faith efforts to fulfill the Wedding reception contract. Perhaps that means getting another restaurant or caterer to do the Wedding reception..

You also must give your customers/clients timely notice of the catastrophe or disruptive event and, in the case of the food provisioner, inform them that delivery has been delayed or will not happen so that they may try to make alternative plans. If only part of your food provisioning business has been impacted, you may also put your customers on allocation as long as the allocation methodology is fair and reasonable.

It is important to understand that you cannot just throw up your hands and give up. If you are under contract, you must take commercially reasonable steps to “mitigate” or lessen the negative impact on your customers and clients under contract with you, and get back in business as soon as reasonably possible. This may include operating temporarily in another location.

Remember, you can avoid some catastrophes by making sure your workplace is safe and up to code. You can minimize the impact to your business by imagining different types of disasters or disruptions that could happen to your business, and determining what action, information, documents, etc. you would need to get back in business. Go Plan!

If you have any questions about the topics covered in this article, please do not hesitate to contact Michael Sullivan at 770.434.1567 or email him at msullivan@taylorenglish.com.

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Do You Need an Attorney to Apply for Deferred Action for Childhood Arrivals (DACA)?

08 Aug 2012 9:36 AM | Anonymous member (Administrator)

Author: Timothy M. Wheelwright and Barbara V. Melendez
Kuck Immigration Partners, LLC

One of the most common questions asked since June 15th when President Obama announced Deferred Action for Childhood Arrivals (DACA) is, "Do I need an immigration attorney to help me apply?" Many respected voices in the immigrant community are saying that the application process and form will be so simple that people won’t need an attorney to apply. Others are saying that too little is known about the program and it is not yet time to consult with an attorney. We disagree.

Before explaining why the help of a competent attorney is so important, we share the concern that many have had since DACA was announced. We have learned from history the sad lesson that immigrants are vulnerable to being exploited and harmed by dishonest and self-serving individuals such as notarios, consultants, and even attorneys. Unsuspecting immigrants are scammed out of their hard-earned money by those who do not follow through with their promises or, worse yet, who "help" them apply for benefits for which they do not qualify. Not only have the financial losses been great, but so have the immigration consequences, many times resulting in a person being deported from the United States. In other cases, many immigrants have also been harmed by those who mean well and who genuinely want to help, but who unfortunately are not aware of the legal complexities of such programs and lack the competence to help someone. Unfortunately there are likely to be those in our community who once again view this new program as an opportunity to make a quick buck off a vulnerable population that is desperate to obtain legal status in the United States. It is important for the immigrant community to be warned about these concerns and to be very cautious about how they proceed. But this does not mean that immigrants do not need to seek competent legal advice about the program.

Although the U.S. Department of Homeland Security (DHS) released additional information and guidance about DACA on August 6th, the application form and specific instructions about the application process will not be released until August 15th, which is the first day that anyone may apply. Although it is possible that the forms will be fairly short, it is not the length of a form that creates the need for an attorney. It is the need to understand the risks of applying and any alternatives available to a particular person, including the choice of documents being presented and how to present them.

You would not go into a police station and turn yourself in for a crime you committed, without first speaking with your attorney. Similarly, you should not file for DACA without at least consulting with an experienced and competent immigration attorney. Although it may be the best alternative for many young people, a competent attorney will be able to help you identify and consider the potential risks and issues of DACA before you "turn yourself in".

Here are some of the risks and issues with DACA that should be considered:

What happens after the first two years?
What happens after the elections?
Will information in the applications be kept confidential?
Will unqualified family members (spouse, parents, siblings) be at risk based on information in the applications?
What if I'm not currently enrolled in school?
What is a significant misdemeanor?
Does my juvenile record hurt me?
Will I have permission to travel out of the country?
Will that travel trigger the three or ten year bars?
Will I qualify when I turn 15?
What about those who are in detention and who can't enroll in a GED program?
What about kids who are home-schooled?
Will there be an interview?
Will they try to deport me if the program goes away?

The risks are significant and these issues are complex. They require the help of a competent attorney right now so you can make an informed choice about whether to apply.

DACA may not be the best choice for everyone. Occasionally other alternatives may be available that have not been explored if you have never spoken to an attorney about your situation.

Some underestimate how challenging it can be to prove you are eligible. What if you do not have the documentation that the government decides is acceptable? If you don't have those documents, attorneys often can help you figure ways to get them or other alternatives. An experienced immigration attorney can also help you choose which documents should be presented, so as to minimize risks to employers and family members who are not eligible for Deferred Action.

Finally, if you choose not to go to an attorney but instead go to a notario or immigration consultant, realize that these people are not easily regulated. There are many good community-based organizations, especially those that are accredited by the Board of Immigration Appeals, that can provide competent and affordable assistance and who know when to call an attorney for help.

We have been hired too many times to clean up the mess after someone not authorized to practice law or someone who is not competent to help, even with the best of intentions, has done it wrong. Those cases frustrate us because often we can't fix the damage that has been done, which is especially troubling when we know that we could have done it right the first time.

There are many good attorneys in Utah who are capable and competent to help you. We strongly suggest that you look for an attorney who is a member of the American Immigration Lawyers Association (AILA), who is experienced in advising clients about immigration matters, who will take the time that your case needs and deserves for you to understand not only the potential benefits of the program, but also the potential risks of applying, and who will answer all your questions and address all of your concerns.

In the end, the decision to consult with an attorney is very personal and one that only you can make. Proceed with caution; ask lots of questions; and make sure you understand the risks and potential issues before you apply. Remember that this could be one of the most important decisions you make for you and your family.

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