Archive for the ‘Compliance’ Category

Drug Testing Can Greatly Reduce Workers’ Compensation Costs

Thursday, October 8th, 2015
Pat Rountree, HR Advisor

Pat Rountree, HR Advisor

CAI’s Advice and Resolution team member Pat Rountree shares valuable information regarding the connection between drug testing and lower compensations costs for your business.

According to CAI’s most recent Policies and Benefits survey, 30% of employers are not conducting drug tests.  Besides the obvious benefits of having a drug-free workplace, another side benefit from drug testing is that it may reduce your workers’ compensation costs.  On the one hand, employees who are under the influence are more likely to experience injuries to themselves or others.  So the knowledge that you conduct post-accident drug and alcohol testing will dissuade most employees and therefore reduce accidents and costs.

Also, under the North Carolina Workers’ Compensation Act, no compensation will be paid for a workplace injury or death if it was proximately caused by, among other things, the employee’s intoxication, provided the intoxicant was not supplied by the employer (company social event) or being under the influence of a controlled substance listed in the North Carolina Controlled Substances Act (G.S. 90-86) unless it was prescribed by a doctor and the prescribed dosages were being followed.  Note, there isn’t an automatic denial of claims due to intoxication but odds are in the employer’s favor unless it can be proven the accident was in no way related to the “altered state” so to speak.

The best way to increase the odds that such claims will be denied is to incorporate a comprehensive drug and alcohol testing policy. Without such a policy, denial of workers’ compensation claims due to being under the influence may be harder to achieve.

North Carolina employers who drug test are required to comply with the NC Controlled Substances Examination Regulation Act which regulates notice requirements to examinees, requires approved laboratories and chain of custody safeguards, specifies conditions for applicant and employee testing, requires confirmation tests on positive samples, and entitles an employee who tests positive to have a retest, if requested, of the same sample at the employee’s expense.

Many states have a provision in their Workers’ Compensation law disqualifying an employee for compensation if the injury was caused by being under the influence of drugs or alcohol.  A number of states also give discounts on Workers’ Compensation premiums (generally 5-7%) for implementing a Drug-Free Workplace Program.  CCH, the Members-only resource, provides State Law Summaries on Workers’ Compensation laws.

CAI encourages drug-free workplaces.  The US Department of Labor has resources for developing a drug-free workplace program.  While this is a requirement for federal contractors, the resources are helpful to all employers.  Consult the state law for specific requirements in other states.  Our drug-testing partner, PDSS, is also a resource for policy development, testing, and in-depth expertise in this area.

For more information on how you can reduce your company’s cost of workers’ compensation through drug testing, please contact our Advice and Resolution team today at 919-878-9222 or 336-668-7746.

Don’t Underestimate the Power of Job Descriptions in ADA Legal Challenges

Thursday, September 3rd, 2015

CAI’s Advice and Resolution team member Pat Rountree shares valuable information regarding job descriptions and compliance with the ADA

Pat Rountree, HR Advisor

Pat Rountree, HR Advisor

The terminology essential functions of the job has been around since the Americans with Disabilities Act (ADA) became law in 1993.  However, the significance of making sure that you have current job descriptions for each position that lists the essential duties, physical, and mental requirements greatly increased with the recent amendments to the ADA.  Also, technology advances have resulted in a faster pace of job change over the last several years.

Employment law attorneys continue to stress that job descriptions that identify the essential functions of the job are the first line of defense when employers are trying to defend undue hardship decisions on inability to make accommodation, and terminations for inability of employees to do the job.

At the most recent CAI/Ogletree Employment and Labor Law Update, Attorney Gretchen Ewalt recommended that employers use the employee performance review time to go over the job description with the employee annually and determine if changes need to be made to accurately reflect the current job responsibilities.

Another recommendation in light of recent case law is to document in the job description if the job requires the employee to be present at the worksite and to document the reasons why.  It may sound ridiculous—of course attendance at work is required.  However, with requests for accommodation to work from home, it is important to document when actual presence at work is required as in the EEOC vs. Ford Motor Company.  The employee, a resale buyer, requested to work from home as an accommodation, but the employee’s lack of availability for impromptu meetings on important issues was an undue hardship for the employer.  The court sided with the employer and noted in their decision, in most jobs, especially those involving teamwork and a high level of interaction, the employer will require regular and predictable on-site attendance from all employees.  To read the full court decision, see

Obviously with the advance of technology, working from home may be a reasonable accommodation for some jobs.  However, for those jobs that require person-to-person contact on the job, it is important to document.

How long has it been since you actually reviewed job descriptions with incumbents to determine that they are still valid?

Considerations in determining essential functions include:

  • The importance of the function to the overall job
  • The number of employees available to perform it
  • The time spent on the function
  • The degree of skill required

Other kinds of evidence that EEOC will consider include:

  • The actual work experience of present or past employees in the job
  • The consequences of not requiring that an employee perform a function
  • The terms of a collective bargaining agreement.

For additional guidance on this topic, please reach out to CAI’s Advice and Resolution team at 919-878-9222 or 336-668-7746.

Sometimes I feel like I am selling fear…

Thursday, August 27th, 2015

The following post is from CAI’s Kevin von der Lippe. He serves as CAI’s private investigator and leads the company’s Background Checking department.

Kevin von der Lippe, Private Investigator

Kevin von der Lippe, Private Investigator

Often, clients hear me talking about the pitfalls of not staying compliant with the nitpicky rules of the federal Fair Credit Reporting Act (FCRA).  Or, they hear me cautioning against transgression of Title VII of the Civil Rights Act of 1964, and how the onerous Equal Employment Opportunity Commission (EEOC) is in their enforcement.  Sometimes I feel like I am selling fear, but the reality is, the litigation is real, the liability for your company is real, and the long term consequences for non-compliance can be devastating to your company.

The view from today’s perspective is that there is a sea of class action lawsuits over small, technical flaws with the paperwork required under the FCRA.  In particular, the two main points of contention are: proper release from your applicant or employee, and sending out the proper paperwork (or even any paperwork) before you make your adverse employment action based upon the background check.

The problem stems from an infamous $22 million settlement on the East Coast in 2008. This particular case showed that suing companies who fail to comply with the FCRA could be lucrative. In 2009, the Sixth Circuit ruled that a plaintiff did not have to show actual damages because the fact that the company failed to comply with the FCRA was in-of-itself an “injury” to the plaintiff, thus giving him justification in filing his suit. [1]

In February 2014, the U.S. Court of Appeals for the Ninth Circuit (in California) ruled that “a plaintiff can suffer a violation of the statutory right without suffering actual damages.” [2] Contrary to rulings from other circuits, this reignited a firestorm and on April 27, 2015, the argument made its way to the nation’s highest court. While the Supreme Court’s decision has not yet been made, the ruling could change Congress’ role in defining how these cases move forward, and perhaps even reduce the number of class action lawsuits that are based solely on technical flaws.

The good news is, you can reduce your exposure under the FCRA by keeping up with the necessary paperwork.  CAI provides samples of the necessary documents on our website,  We also provide the necessary FCRA paperwork with every report issued by our background checking department.

If you have questions about our background checking services, or how CAI can help you remain in compliance with the federal laws related to background screening, please do not hesitate to contact Kevin W. von der Lippe at (336) 899-1150 or by e-mail at

Capital Associated Industries Services Corporation is a licensed investigative agency, specializing in corporate pre-employment background screening. Our corporate agency license is BPN 001473P11.

[1] Beaudry v. TeleCheck Services, Inc., (6th Cir. 2009).

[2] Thomas Robins v. Spokeo, Inc. (9th Cir. 2010)

How the Department of Labor’s Overtime Changes Will Affect Your Company

Tuesday, August 18th, 2015

In today’s video blog, CAI’s Senior Executive and HR Advisor, George Ports, discusses the US Department of Labor’s (USDOL) recent proposed changes to overtime regulations and what employers must do in order to remain compliant. George begins by noting that under the new revisions to the Fair Labor Standard Act (FLSA), the USDOL will increase the minimum salary threshold for exemptions, opening up eligibility for overtime protections to nearly 5 million workers nationwide.

George believes it is important for employers to know how these changes will affect their company, and goes on to list the specific revisions to the FLSA. Some of these proposed changes include:

  • A vast increase in the minimum salary level exemption for the executive, administrative, and professional exemptions from $455 per week to no less than $921 per week
  • An increase in the minimum salary exemption for highly compensated employees from $100,000 to $122,148
  • A metrics system to automatically increase the minimum salary threshold test on an annual basis

In order to examine the impact these changes could have, George advises employers to make the necessary alterations to salary levels or re-classify positions. For those employers interested in making comments on these proposed changes, head to to make your voices heard. Just make sure to do so before the 60 day comment period ends on September 4, 2015.

Please call our Advice and Resolution team at 919-878-9222 or 336-668-7746 with any related questions.

The Questions You Shouldn’t Ask in an Interview

Tuesday, May 12th, 2015

interview questionsInterviewing candidates can be an enjoyable and sometimes stressful endeavor. This interview or interviews may be the only chance you get to ask all that you want to know about a candidate before you make a hiring decision.

You don’t want to forget to ask something and you do want to ask all of the right things. This could sound alarming to you, or maybe you love interviewing candidates and that is one of the reasons you decided to go into HR. No matter what your view is on interviewing, one thing you don’t want to do is ask questions that could get you and your company into trouble.

That’s right, trouble. There are interview questions that are illegal.  According to a recent survey from*, one in five employers has unknowingly asked a job candidate an illegal interview question. The legality of these questions ultimately protects both parties involved. For you and your future candidates’ protection, take a look at this list of illegal interview questions:

  • What is your religious affiliation?
  • Are you pregnant?
  • What is your political affiliation?
  • What is your race, color or ethnicity?
  • How old are you?
  • Are you disabled?
  • Are you married?
  • Do you have children or plan to?
  • Are you in debt?
  • Do you socially drink or smoke?
  • When do you plan to retire?
  • Where do you live?
  • What was the nature of your military discharge?
  • Are you a U.S. citizen?

You may find that you have asked some of these questions before, or that you need to know these things to make your hiring decisions. You may have wanted to know if someone was ok with relocating so you asked her where she lives. To make sure you are protected, ask her instead flat out if she is willing to relocate. Or ask a candidate where he sees himself in fifteen years instead of when he is planning on retiring.

Think through interview questions before asking them, and make sure you aren’t breaking any laws!

For more information of the legalities of interviews and interview questions, contact a member of CAI’s Advice and Resolution Team at 919-878-9222 or 336-668-7746.


Photo Source: COD Newsroom

Summer Planning for Youth Employment

Tuesday, May 5th, 2015
Pat Rountree, HR Advisor

Pat Rountree, HR Advisor

Summer is on its way, and in today’s post, CAI’s Advice and Resolution team member Pat Rountree shares critical information about summer employment opportunities for teens and young adults.

Applications for summer employment are likely already arriving as the school year draws to an end. Now is a good time to review things you need to know to be in compliance with laws affecting youth employment.

Wage and Hour Laws


North Carolina and federal law have limitations on hours and occupations for employees under age 18 applicable to non-agricultural employers. Where North Carolina employers are also subject to the Fair Labor Standards Act (FLSA), the laws that offer the most protection to minors are applicable.

Youth under 18 may not work in any occupations determined to be hazardous or detrimental. (See and

During non-school weeks, there are no restrictions on hours for youth 16 and over. If they are attending school, they may not work during the hours of 11:00 pm to 5:00 am if they have school the next day unless waived in writing by a parent or principal.

Minors age 14 and 15 may not work in any manufacturing job and are limited to eight hours per day, 40 hours per week between the hours of 7:00 am and 7:00 pm (7:00 am to 9:00 pm from June 1 to Labor Day) during non-school weeks. They must also be given a 30 minute break after working five hours. For more detailed information on restrictions for youth age 14 and 15, go to

Children of business owners may work for their parents in their business any hours, but not in hazardous or detrimental occupations as noted above.

Agricultural/Farm Jobs

North Carolina does not regulate youth employment in agriculture. For the applicable federal law, go to

Youth Certificate Required

All youth under age 18 working in North Carolina must obtain a youth certificate (worker’s permit) and submit it to the employer prior to starting work. See These must be retained for at least two years after employment ends or until the employee reaches age 20.

Agricultural Occupations

The North Carolina youth employment provisions do not apply to farm work.

Drug Testing and Background Checks

Attorneys recommend having the parent sign the consent for pre-employment drug testing or post-offer background checks if these are required contingencies. However, the results should be released to the minor and not the parent(s).

Completing the Form I-9

If the minor has documents to satisfy I-9 requirements, they may complete Section 1 and present documents.

If the minor cannot present documentation of proof of identity and authorization to work, the parent may complete Section 1 on behalf of the minor. (See

If you have questions about youth employment, please contact a member of CAI’s Advice and Resolution team at 919‑878‑9222 or 336‑668‑7746.

New Legislation Activity Will Affect NC Employers

Tuesday, April 14th, 2015

George Ports, CAI’s Senior Executive and HR Advisor shares important legislation updates for NC employers in today’s post.

George Ports, Senior Executive and HR Advisor

George Ports, Senior Executive and HR Advisor

The 2015 Session of the North Carolina General Assembly officially convened on January 28, 2015.  As we expected, there has been a lot of activity pertaining to legislation introduced affecting day-to-day workplace issues, legislation that I will be covering at CAI’s 2015 Employment and Labor Law Update in May.

Bills introduced in the House and in the Senate aim to make changes to North Carolina’s unemployment laws.  Some of these changes such as requiring a photo ID to receive benefits, requiring more weekly attempts by claimants to obtain employment and authorizing the NCDMV to release social security numbers to the NCDES to prevent fraud were contained in legislation passed in the 2014 Session but vetoed by Governor McCrory.

Other legislation addresses criminal record expunction laws, one bill places restrictions on credit history checks for applicants, and another provides NC Industrial Commission fraud investigators more authority (investigators would be sworn law enforce officers with arrest powers).  Oh yes, and there is a bill that attempts to revise North Carolina’s E-verify law, increasing the number of employers required to use e-verify (employers from 25 or more employees to employers with 5 or more employees).

For many years “employee misclassification” has been a Hot Button for USDOL’s Wage & Hour Division—is the individual providing services to an employer an employee or an independent contractor?  This misclassification issue has garnered quite a bit of attention from North Carolina regulatory agencies and legislators.  Employers don’t pay payroll taxes or unemployment taxes on independent contractors nor are independent contractors covered by employers’ workers compensation insurance.  Independent contractors therefore are not eligible for unemployment or workers’ compensation benefits.

As this article is being written, there are at least four bills that have been introduced in attempts to address “employee misclassification.”  All four have their own definitions of employee and independent contractor.  Two bills are similar in their definitions and that they allow employers a “second bite of the apple” before penalties are imposed.  There is one bill’s definition of an independent contractor, however, it is quite narrow and its penalties for misclassifying an employee as an independent contractor are severe.  Civil penalties can range from $500 to $4000 per violation.  The amount of the penalty will be determined by “the size of the business of the person charged and the gravity of the violation”.  This legislation also contains a provision giving regulatory agencies the authority to issue a stop work order, in other words, shut down business operations. 

During my presentation, I’ll be giving status updates on each bill, stating whether they’ve passed and providing insights as to the probability of them passing or not.  We at CAI look forward to hosting our annual Employment and Labor Law Update on May 14th and 15th at the McKimmon Center in Raleigh.

The Employers Coalition of North Carolina (ECNC) was created to give the business community a more focused avenue of public policy input concerning day to day employer-employee workplace issues. ECNC is a partnership of three North Carolina employers’ associations: CAI (Capital Associated Industries), TEA (The Employers Association) and WCI (Western Carolina Industries) and their 2500 members.

Are You Making Costly Compliance Mistakes?

Thursday, March 19th, 2015

Business meetingNot knowing the different federal and state employment laws is not an excuse for not following them. Making sure you are in compliance can be overwhelming as several regulations and laws get amended or updated each year. Trying to keep up with all of the information may be time consuming or frustrating, but staying informed is necessary for keeping you and your organization protected.

Based on the EEOC’s 2014 Charge Receipt, employers all over the country lost nearly 300 million dollars for not staying compliant with employment law in that year. Don’t let this happen to your organization. Government enforcement agencies like the EEOC are always looking for ways to improve their methods for finding employers that are not following the law—whether purposefully or unknowingly.

Follow these three steps to help you stay on top of any federal or state law changes:

  • Research, research, research

Research is essential for making sure you understand the responsibilities you have to your employees and the business community. Some helpful websites to make sure you’re getting the information you need include:,, and

  • Attend an employment law conference or web series

Let’s face it—we are not capable of doing it all or knowing it all. Finding information on your own through internet searching or government agency announcements is important and should be part of every employer’s quest to stay compliant. Attending an employment law conference or joining a web series on the topic with industry experts, such as employment law attorneys, ensures that you get a deeper dive and a broader base of knowledge to keep your company protected.

  • Form a community

Make sure to stay in touch with your industry peers. The community support you can receive will be helpful for you when you need assistance in making a policy decision or handling a difficult employee situation. Whether they are coworkers on your team or members of a local industry group you meet up with monthly, it’s important for you all to discuss the different issues and laws that currently and will eventually affect employers.

Knowledge is your strongest defense against the complicated, ever changing world of federal and state employment law. Don’t risk your company’s reputation or having to pay attorney fees because you were unaware of the information you needed to keep your company safe and protected.

Guarantee that your company stays on track in 2015 and beyond by joining us for our 2015 Employment and Labor Law Update on May 13 and May 14 at the McKimmon Center in Raleigh. You will learn everything you need to know regarding updates to state and federal employment law. Some of the conference topics include: the NLRB, the Affordable Care Act, undue hardships and the ADA, sexual harassment, data security, FMLA and more!

Drugs, Alcohol and the ADA

Thursday, March 12th, 2015

Advice and Resolution Team Member John Gupton shares helpful information about the ADA and what the law allows in regard to drugs and alcohol.

John Gupton, General Counsel and HR Advisor

John Gupton, General Counsel and HR Advisor

In general, the Americans with Disabilities Act (ADA) prohibits covered employers from discriminating against a “qualified individual with a disability” in regard to job applications, hiring, advancement, discharge, compensation, training, or other terms, conditions, or privileges of employment. The ADA requires employers to make “reasonable accommodations” to the known physical or mental limitations of an otherwise qualified individual with a disability, unless to do so would impose an “undue hardship” upon the employer.

The ADA specifically allows employers to prohibit the use of alcohol or illegal drugs in the workplace and require that employees not be under the influence. Employers may test for the use of illegal drugs under the ADA. Employers also may maintain and enforce rules prohibiting employees from being under the influence of alcohol in the workplace and may conduct alcohol testing for this purpose if they have a reasonable belief that an employee may be under the influence of alcohol at work.

While current illegal drug users and alcoholics who cannot safely perform their jobs are not protected by the ADA, those who have been rehabilitated or are participating in a supervised rehabilitation program and are not currently using drugs or who are erroneously regarded as engaging in the illegal use of drugs, are covered. Thus, an employer may be required to make reasonable accommodation to recovering alcoholics, for example, by allowing time off to attend Alcoholics Anonymous meetings.

For more information about the ADA, go to If you have questions about the ADA, please contact a member of CAI’s Advice and Resolution team at 919‑878‑9222 or 336‑668‑7746.

AAP: Changes to Veteran Self-Identification Solicitation

Thursday, February 26th, 2015

CAI’s Manager for Affirmative Action Services, Kaleigh Ferraro, shares important information regarding AAP requirements and solicitation of self-identification information from veterans.  Make sure you are compliant.

Kaleigh Ferraro, Manager, Affirmative Action Services

Kaleigh Ferraro, Manager, Affirmative Action Services

On September 25, 2014, the Veterans Employment and Training Service issued a final rule changing the reporting requirements for employers covered under the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA).  This final rule rescinds the VETS-100 report and changes the annual veterans report from VETS-100A to VETS-4212.  This reporting change will allow employers to report on aggregated protected veterans rather than the individual veteran classification.  There will also be the option to report on veteran hires and total hires either by the EEO-1 categories or in total.

Since this changes, federal contractors and subcontractors subject to AAP requirements have been asking how this affects their solicitation of veteran classifications during the hiring process.  Regulation changes to VEVRAA effective in 2014 required contractors to solicit veteran status both pre job offer and post job offer.  The solicitation was different pre-offer versus post-offer.  The pre-offer form requested only for applicants to voluntarily self-id as “protected veteran” while the post-offer form requested individuals to identify as specific veteran classifications.  Since the VETS reporting in 2015 will report on aggregated veteran data, the post-offer requesting specific classifications seemed unnecessary.

The Office of Federal Contract Compliance Programs (OFCCP) responded on January 20, 2015 with guidance regarding the self-identification forms and solicitation.


  1. Federal contractors and subcontractors may use the same self-identification form for per-offer and post-offer solicitation during the hiring process. This form will invite applicants to voluntarily self-identify as “protected veteran”. There is no need to request specific veteran classification
  2. Contractors may continue to request specific veteran classification post-job offer if they choose to do so.


For more information on affirmative action and the recent changes within it, be sure to sign up now for our FREE one hour webinar AAP: What You Need to Know About Recruiting and Applicant Tracking on March 24, 2015.

Our affirmative action team at CAI is dedicated to helping you with all of your affirmative action needs. Whether it’s designing an AAP plan for your company, doing a full audit on an existing plan, or simply answering a few questions, please contact me directly at 919-713-5241 or