TPO's Employment Update


n  Legislative Update

n  Succession Planning - Part II of IV

n  2007 Harassment and Discrimination Regs

n  Welcome New Members

n  Member Spotlight

n  HR Rumors

n  Job Descriptions



Training Calendar

CA Employment Essentials (HR101)

- a training series focusing on the regulatory compliance and HR best practices - the information & skills supervisors & managers need to keep themselves and the organization out of hot water!

n May '07

n July '07

Management Excellence Series

- a training series focusing on practical leadership and communication skills to help managers develop or refine their effectiveness as leaders!

n April - May '07

n August '07

Specialized Workshops

n Harassment & Discrimination at Work  May 24

n Excelling as a First Time Manager Oct 18

n I'd Rather Not Discuss It  June 12

n FMLA/CFRA/PDL Compliance  Aug 16

n Workers' Compensation Management Sep 19


Missed Meal and Rest Period Clarification

On April 16, 2007,  the California Supreme Court ruled that premium pay issued to employees under California Labor Code section 226.7 to compensate them for missed meal and rest periods is considered wages, and not a penalty.

This landmark decision dramatically increases an employer's liability by establishing a three-year statute of limitations as opposed to a one-year statute of limitations.

Class action claims for meal and rest period violations have been on the rise because of the potential for substantial payouts from per-employee/per-day penalties.

The consequences of this ruling are dramatic; when paying the premiums, an employer must ensure that the premiums are calculated as an hour of pay at the employee's "regular rate" of pay, not an hour of pay at the employee's straight-time rate of pay. Meal and rest period premiums will, as wages, now be subject to the withholding of income and payroll taxes. These premiums, insofar as they are related at least in part to the hours worked, also fall within the categories of information that must be itemized on an employee's earnings statement.

An additional unanswered question is whether meal and rest period premiums must be included in the regular rate of pay on which overtime is calculated. While the Labor Commissioner had informally stated that such premiums are not included in the regular rate of pay, the remedies for missed meal and rest periods are similar to the premiums paid for working off-hours shifts, and such shift differential premiums are included in the overtime calculation. Additionally, since the meal and rest period premiums are pay for work actually performed, it may be difficult to exclude such amounts from the regular rate on the basis that pay for time not worked, such as minimum reporting pay, is excluded from the regular rate of pay.

What should you do? As a minimum, employers should:

1. Make sure your non-exempt employees are aware of their right to take legally mandated meal and rest periods.

2. Have and enforce a written policy that employees are not required to work during rest periods and that employees may not work through meal periods.

3. Keep all time records, including records of meal periods, for a minimum of three years so you have documentation in the event of a claim. If you don't utilize a time clock, implement a sign out/sign in procedure for at least the meal periods and consider a similar practice for the rest periods.

If you have questions about complying with the requirements for meal and rest periods and/or the corresponding premium pay for employees having not taken them, contact TPO or appropriate counsel. We will be providing more information on this critical topic as additional clarification is provided.



Healthy Families Act - Federal legislation that would guarantee 7 paid sick days per year to employees working at least 30 hours a week, at companies with 15 or more workers. Under the bill, the sick days could be used for the employee's own medical condition, as well as doctor appointments or medical treatment, as well as to care for an ill family member. Pro rata paid sick leave benefits would be available to part-time employees. The measure provides benefits similar to those under the new San Francisco, CA paid sick leave ordinance that took effect in February.

Announcing the legislation, Sen. Kennedy stated that almost half of private-sector workers currently do not get paid sick days. The Healthy Families Act benefit "66 million Americans: 46 million would gain access to paid sick days; 19 million would gain paid sick days for leave for doctors' visits and family care; and 1 million Americans would gain additional paid sick days."


1. Four-Day Work Week - CA legislation (AB 510) that would permit individual workers and their employers to mutually agree to a four-day workweek, without the complicated "alternative workweek" requirements outlined in the Wage Orders. AB 510 would permit an individual employee, with the consent of his/her employer, to work up to 10 hours per day within a 40-hour workweek without overtime pay. Overtime premium pay still would be required for more than 10 hours of work in a workday or 40 hours in a workweek, as would double-time after 12 work hours in a day.

Unionized workplaces already allow workers to choose to work four 10-hour days, but that it is much more difficult for workers at non-unionized workplaces under the current "Alternative Workweek" restrictions which requires secret ballot elections and submission of the Alternative Workweek to the state.

Similar legislation during the 2005-06 legislative session failed on party-line votes (Republicans voting for and Democrats voting against.)

2. Posters in Plain Language - CA legislation (AB 613) that would ensure current state-mandated workplace posters use simple, plain language with common, everyday words, short sentences, and terms and definitions that are simply and clearly defined.

3. Employment Verification Act of 2007 - would:

1. require employers to verify each new employee's social security number with the Social Security Administration (SSA) and to provide annual reports to the Franchise Tax Board (FTB) showing the name and social security number of each employee;

2. provide a tax credit of $100 to an employer for each newly hired employee for whom a valid social security number has been provided to the FTB; and

3. impose on an employer a fine of $1,000 for each employee for whom the employer has not provided a valid social security number.

Opponents of the bill have concerns, including: what the FTB will do with the information, that confirmation of the SSN does not necessarily mean it is the true SSN of the worker, a possible conflict with CA employment laws regarding mismatches of SSN names/numbers, and that the bill may actually be an attempt to regulate immigration.

While the credit is relatively small in nature for all but the largest employers, it is unlikely to do much to offset the burdens of administration of yet another reporting obligation.

4. Employer Provided Health Care Coverage - CA legislation (AB 8) that would require employers to provide health care coverage or pay a new payroll tax. This bill is broad in scope and provides no exemptions, but does not apply to the self-employed. Opponents contend that AB 8 would not make health care coverage any more affordable for the employer, even though high costs are the main reason employers can't provide health benefits. While AB 8 does not yet specify the level of taxation (a percentage of payroll) for employers who do not provide health coverage, opponents believe the tax increase needed to finance the level of benefits are likely to be significant.

5. Workers' Compensation - CA legislation (AB 1212) would increases workers' compensation costs and require a revision to the Permanent Disability Rating Schedule, with the effect of increasing permanent disability ratings.


Challenges of Finding Talent -

Where Are They and How Do We Get Our Hands
on Them?


When an employer is caught with a vacant management position, there is often a knee-jerk reaction to fill that position with a warm body that resembles what the organization feels management should look like. However, as outlined in Part I of our series on Succession Planning, identification of critical positions and future vacancies as well as individuals who might potentially fit into these vacancies will give the organization a larger and more qualified pool from which to draw.

Parallel to identification of key positions in the organization is the determination of future critical success factors for the position. What are the skills and competencies needed in the future for critical positions? How will you determine a potential candidate has demonstrated the skills and competencies for success? It is also important to identify why key talent is leaving the organization and make a conscious choice that culturally ingrains "passing the torch." It can be challenging to recruit for a key management position based on "future" needs and goals. However with an eye to future customer needs, future market conditions, and what it will require to be competitive, organizations can outline a management profile for the future. Once identified, it becomes easier to target those skills and experiences in current and potential employees.


Key management talent is crucial in the hyper-competitive global economy. Organizational talent becomes a competitive advantage and is just as important to organizational growth as adequate capital and a sound business model. Organizations today need executive and staff talent who have the vision to take the organization to the next level, as well as manage up, down, and laterally. Developing talent takes time and often becomes a "nice to do" item on organizational check lists. Many organizations are engaged in finding warm and safe places to avoid pain and find it difficult to focus on the very things that could help them rise above that stage. Organizations tend to focus on in-the-moment issues - putting out fires, such as cash flow, increased production, increased costs, and filling the ever revolving door of vacancies with qualified and talented people.


It becomes more important in current market conditions to be very clear about the specifics of the open position as well as how the organization will "sell" itself to prospective candidates. While perks, bonuses and traditional rewards are not at the level we saw in the technology boom of the mid to late 1990's, companies are aware that by strategically reviewing the Total Remuneration issues such as health benefits, compensation, child care, relocation costs, etc., they can provide an attractive "package" for potential candidates - especially if those candidates are already employed by competitors.

Key factors to identify in the recruitment of qualified employees are:

n Critical cultural success factors

n Recruitment policies and systems that must change to reflect current practices as well as future goals

n Non-viable job descriptions that must be rewritten in order to have a clear understating of the tasks and responsibilities

n Personality traits of a high performing employee (with regard to a specific position as well as organizationally)

n Competitors and potential candidates to cast a broad net for potential new leaders

n Recruitment processes that must be systematized to ensure consistency of screening techniques, predictive assessment, reference checking, orientation and training.

Talent Identification - It is easy to identify a handful of people whose departure would be devastating to the organization. It is somewhat harder to identify current employees who are already thinking beyond their job, thinking bigger, and have the potential to make a bigger impact on the organization. The task is simpler in small organizations, but becomes a serious search in larger organizations. Once identified, current employees are prime for development to move up into the management positions. Advantages of developing current employees are retaining of institutional knowledge and industry intelligence that can depart with key executives. Additionally, defining what specific expertise will be needed highlights the importance of finding individuals with a broad knowledge base. Our next installment in this series will focus on the development of internal talent.

Targeting and Recruiting Talent - When looking outside the company for talent whether executive or otherwise, most skilled recruiters will target the company's competition - individuals who are already engaged in areas that the organization has identified as a potential gap in knowledge/skills or expertise. Passive candidates are typically the best qualified for positions you need to fill and also may be less susceptible to multiple offers. The recruitment process starts with clearly outlined objectives, skills, experience and knowledge needed to perform the position successfully - the nuts and bolts of this starts with an up-to-date job description. Additionally, defining what specific expertise will be needed now and in the future will help to identify individuals with a broad knowledge base. Expertise in only one area can be a handicap in today's global market.

Critical Success Factors - in addition to key position specific job skills critical success factors for key talent are:

n Knowledge of the industry or industries

n Vision to take the organization to the next level - often overlooked and under valued in looking at current employees.

n Broad understanding of business and it's global operations

n Flexibility - the right approach at the right time

n Reasoning and problem solving skills

n Strategic skills required to control costs, increase revenue and be competitive

However, not all organizations are created equal. The strategic skills required to grow an organization are not always transferable to another.

To conclude, when employers recognize the inherent benefits of developing an integrated recruitment plan to their succession planning system they have recognized one of the greatest costs in their business environment - the total cost of turnover as well as the potential loss of top talent. The next part in our series will focus on training and development processes that help ensure growth and development of key talent, but will also become a competitive advantage in the recruitment process.
If you are ready to put a proactive recruitment process into your organization, contact TPO to facilitate development one that fits your business needs. TPO can also provide that extra help you need in your next recruitment.

Missed Part I of the Series? Click here to read TPO's previous newsletters.

TPO Announces NEW 2007 Harassment Programs!

Fulfill California's AB 1825 Harassment Training Law for all supervisors/managers for as low as $79 per participant!

California law (AB 1825) requires employers with 50 or more employees to provide 2 hours of sexual harassment training by 12/31/05 and every two years thereafter to all supervisors/managers. Additionally, newly hired/promoted supervisors/managers must receive the training within 6 months of hire.

For most employers, this means that 2007 is a Training Year. TPO has created a NEW interactive Harassment and Discrimination Prevention Training Program facilitated by qualified TPO Representatives which exceeds state regulations.

Plan your 2007 training now!



1. Your Team Training: Your location or at TPO's Professional Development Center.
Contact us for more information!

2. Scheduled Classes: Join other organizations at TPO's Professional Development Center. Sign individuals up for open-enrollment class at TPO.

All programs available in Spanish!

To schedule your organization's training, contact TPO:

Phone: 800.277.8448 • Fax: 831.658.0201 •


n Mee Memorial Hospital

n Craven Landscaping

n Monterey Peninsula Chamber of Commerce

n Pacific Valley Bank

n Misionero Vegetables

n Carmel Area Wastewater District


n Santa Fe Aggregates

n Holman Ranch

n Romie Lane Pediatric Group

n Community Oral Health Services

We look forward to the opportunity to provide each of you with unlimited phone/email access, reduced consulting and training rates, eCompliance notices, attendance to our Annual Employment Law & Leadership Conference at no additional cost, and priority status when you require TPO support from any of our highly qualified team of HR experts! Thank you for joining!


Four Sisters Inns is headed by Shelley Post Claudel as president and supported by a corporate staff and some 250 talented and dedicated individuals.

TPO: "Four Sisters Inns has been a TPO member for almost 14 years. How do you feel TPO contributes to Four Sister's success?"

Shelley: "As an organization with 15 different locations spread across two states, our human resources needs are both unique and challenging. TPO has provided us with a coordinated and comprehensive approach to addressing this situation. Additionally the management team has greatly benefited from the training seminars, including those offered in a large group format with other companies and particularly those customized to address our particular issues.

TPO has walked us through a variety of diverse employee situations over the years, using an effective combination of sound HR advice, practical solutions and a little humor. Jill, Robert and their entire team have always "been there" for us, to listen and advise, and we are very appreciative!"

Four Sisters is a collection of extraordinary inns located in the most spectacular regions of the west. The Post Family Home was a spectacular, multi-gabled 1888 Victorian mansion overlooking Monterey Bay. Already christened "Green Gables" by a previous owner, who had opened it to travelers, the home was the subject of regular inquiries from would-be guests. Finally, in July 1975, the Posts were persuaded to become seasonal hosts. For several years, they reshuffled their living quarters during the summer months to rent rooms to enthusiastic guests.

Four Sisters Inns gradually added new inns to the collection, each chosen with an eye toward elegant architecture, historical significance, and a truly unique setting. Coupling these inns with home cooking and gracious, friendly service, they soon had a steady stream of business. Rooms at the original inns (including Green Gables, Gosby House and Cobblestone) are decorated with the Post's elegant antiques. For more information about Four Sisters Inns, visit their website at

HR Rumors: Get Your Facts Straight from the Experts!


Do I need to reimburse my employees when they use their cell phones for business calls?



Current law requires that employers reimburse employees for all reasonable expenses they expend or lose as a direct consequence of the performance of their duties or in compliance with your instruction.

To keep expenses under control and ensure ease of administration, most companies develop policies and procedures for expense reimbursement, but this is not required by state law. Policies should, however, be designed to support the employer's overall business objectives.

Common expense reimbursements are travel (air, mileage), lodging, meals, entertainment and telephone. With more and more employees using cell phones, it may become a business necessity to use personal cell phones as a matter of convenience to support a 24/7 workweek. The deciding factor here is whether cell phone use is required by the employer for employees to perform their duties.

If employers are not requiring their employees to use personal cell phones for business purposes, but employees have taken it upon themselves to provide personal cell numbers to business associates, employers are not required to reimburse that employee for its use. If an employer requires employees to use a cell phone to conduct business, then the employer is required to reimburse employees for the use. Some companies may provide cell phones to their employees. Other employers might find it easier and more cost effective to reimburse employees for the use of their personal cell phones.

Reimbursements paid to employees for ordinary and necessary business expenses are excluded from the employee's income and are not subject to income tax if they are paid under an "accountable plan." The IRS defines an "accountable plan" as an arrangement where employees incur expenses while performing the duties and tasks of their job and can substantiate them through expense records (that show the time, place, amount, and business purpose) within a reasonable time period.

Employers are advised to define in their Cell Phone Policies (or other expense reimbursement policies) in their Employee Handbook to outline reasonable time for submission of expense reimburse (for example, once per month prior to the pay period). It is also important to define acceptable documentation required for reimbursement. Regardless of when employees submit expenses reports, employers are required to reimburse them for expenses directly related to the execution of their job.

Additionally, starting July 1, 2008, California Vehicle Code 23123 prohibits drivers from using a wireless telephone or device unless it is "specifically designed and configured to allow hands-free listening and talking." In anticipation of the new California amendment to the Vehicle Code (23123), we recommend that employers amend their communications policies of their Employee Handbook to include provisions of this new law. While fines for violations of the vehicle code are minimal ($20-first offense and $50 for each subsequent offense), the positive consequences of this legislation are the increase in safety and decrease in "distraction" incidences.


For more information about employment policies and practices, give TPO a call!

Let Us Count The Ways -

Don't Miss This No-Nonsense Workshop!

This comprehensive 4-hour workshop includes TPO's popular Job Description Development Program designed to assist employers in developing current, state-of-the-art, and ADA & FEHA compliant Job Descriptions. 

Participants will:

n Understand the impact of Job Descriptions in recruitment, hiring, performance management, leaves of absence, safety, career development, and even terminations;

n Create a Job Description using TPO's "system" for developing and maintaining current, ADA & FEHA compliant and consistently formatted job descriptions including job knowledge, training, education, skills, and characteristics needed to successfully perform the job; and

n Learn to identify and define the key responsibilities, "essential functions", and physical requirements of each job in your organization.

LOCATION: TPO - 60 Garden Court, Suite 100, Monterey

COST: Members: $495* per participant    Non-Members: $595* per participant

         *Includes TPO's Job Description Development Program! - a $500 value

DATE: November 6, 8:30 am - 12:30 pm

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