Georgia Employment Handbook

Georgia provides temporary financial assistance to eligible unemployed individuals through itsEmployment Security system. The system is financed by taxes on employers that are determinedby experience rating. The taxes are due quarterly. The system is intended to assist workers who areunemployed through no fault of their own. It can provide up to 26 weeks of unemployment compensation.Employers have several obligations under Georgia’s unemployment statute. Employers must give aseparation notice to every employee who is separated from their employment, regardless of the reasonfor separation. Employers must also maintain records regarding an employee’s wages for up to four yearsand make the records available for inspection if requested by the state Department of Labor. Additionally,employers must file wage, tax, and liability reports with the state Department of Labor.To qualify for unemployment compensation, employees must satisfy three requirements. The firstrequirement concerns the amount of an employee’s past wages. An employee must have insured wagesin at least two quarters of the “base period.” The base period is the period approximately one year beforea claim for benefits is filed. Additionally, the insured wages in the two highest quarters of the base periodmust be at least $1,134, and the total base period wages must be at least one and one-half times theamount of money paid to the employee in the highest quarter. The Department of Labor will use analternate calculation if the only reason an employee is ineligible for benefits is because his or her totalbase period wages are not one and one-half times the amount of money paid in the highest quarter.Second, an employee will generally not be eligible if they have unjustifiably quit or if they were firedfor misconduct. For example, an employee may be disqualified for failure to obey orders, rules, orinstructions or for failure to discharge their duties. However, the types of misconduct that will disqualifyan employee for unemployment compensation are limited. For example, employees are not disqualifiedwhere they made a good faith effort to perform duties but were unable to do so, where they didnot intentionally fail or consciously neglect to perform their duties, where they were terminated forabsenteeism which was due to their or a family member’s illness, or where they were unaware of the rulethey violated that resulted in the termination. Refusal to do suitable work, including where the employeeis striking as part of a labor dispute, may also disqualify the individual. And the former employeesare not entitled to benefits for a period for which they are receiving wages in lieu of notice, workers’compensation wage-replacement benefits, or retirement benefits.Third, to be eligible for unemployment compensation, an employee must be physically able to workand must be actively looking for full-time work every week. An employee must also keep a record of jobsearch contacts and be registered for work with the Georgia Department of Labor’s Employment Service.Unemployment claims are filed with field services offices of the Georgia Department of Labor, and theemployer typically receives a notice with the claimant’s statement. The employer is given the chance tosubmit information in writing or to attend a predetermination hearing. An initial determination is normallymade by a claims examiner. Either party may appeal to the appellate level, which is technically anappellate tribunal, but the matter is usually heard before an administrative hearing officer. The decision atthat stage can be further appealed to the Board of Review, and from there to Superior Court. 51

Chapter 14:Smoking

With certain exceptions, the Georgia Smokefree Air Act of 2005 prohibits smoking in all enclosed areasin places of employment and in all enclosed public places in Georgia. For purposes of the GeorgiaSmokefree Air Act, a “public place” is any enclosed area to which the public is invited or in which thepublic is permitted, including, but not limited to, banks, bars, health care facilities, reception areas, waitingrooms, restaurants, retail stores, and shopping malls. Certain businesses open to the public are exemptfrom the Act’s proscriptions, however. These exempt businesses include retail tobacco stores and barsand restaurants that deny access to any person under the age of eighteen and that do not employ anyindividual under the age of eighteen.With respect to enclosed areas in places of employment, the prohibition against smoking is quite broadand generally encompasses private offices, common work areas, hallways, cafeterias, employee lounges,stairways, and restrooms, among other enclosed areas. The Act does not apply, however, to vehiclesused in the course of employment or to common work areas, meeting rooms, and private offices in privateplaces of employment (other than medical facilities) that are open to the general public by appointmentonly. Despite the general prohibition against smoking in enclosed places of employment, the Act permitsemployers to designate an interior, enclosed area as a smoking area, provided that the smoking area isin a nonwork area that no employees (other than custodians or maintenance workers) are required toenter as part of their work responsibilities, the smoking area is for employee use only, the employer postsa notice identifying the smoking area as such at each entrance to that area, and the air-handling systemfor the smoking area is independent of the ventilation system for the rest of the building and exhaustsair from the smoking area directly to the exterior of the building in a way that prevents it from infiltratingother areas of the building. The Act does not require employers to provide smoking areas for employees,however, and an employer may designate its entire property as a no-smoking area.The Georgia Smokefree Air Act requires employers to inform employees and all applicants foremployment about the prohibition against smoking in the workplace. The Act also requires employers andother covered entities to post “no smoking” signs or symbols in every enclosed public place or place ofemployment where smoking is prohibited. All ashtrays (other than those that are permanent fixtures) mustbe removed from areas where smoking is prohibited.The Georgia Smokefree Air Act does not designate any particular penalties for violations and doesnot expressly create a right to sue for aggrieved individuals. It does, however, authorize the GeorgiaDepartment of Human Resources and county boards of health to enforce the provisions of the Act and,in carrying out that authority, to enter upon and inspect the premises of employers and public places. TheAct does not preempt county and municipal laws on smoking that are more restrictive than the Act. 53

Chapter 15:Duty to Report NewlyHired Employees

In 1996, Congress enacted the “Personal Responsibility and Work Opportunities Act” (the “Act”) aspart of welfare reform. In part, the Act is designed to enforce child-support obligations. To that end, theAct requires states to establish new-hire reporting laws and create new-hire directories to facilitate thelocation of noncustodial parents when they change jobs and to facilitate the withholding of child-supportpayments. Under these reporting systems, employers are required to report information regarding newlyhired and rehired employees to the state.A. Do I Have to Report? As part of Georgia’s Child Support Recovery Act, the state requires all employers doing business in Georgia to report new-hire information to the Georgia Department of Human Resources. This means that employers must report the hiring of any employee who resides or works in Georgia to whom the employer anticipates paying earnings. This includes employees who work only one day before resigning or being terminated. Employers must also report the hiring or return to work of any employees who were laid off, furloughed, separated, terminated, or granted leave without pay or who remained on the employer’s payroll during a break in service or gap in pay.B. How Do I Report New Hires? Fortunately for employers, the Georgia New Hire Reporting Program allows employers to report newly hired and rehired employees either online or electronically. To do so, employers must either register for online reporting or download software to enable them to report using their own communications software. To register or to get additional information, employers should visit www. ga-newhire.com. Of course, employers may still report their new hires using a New Hire Reporting Form or self- prepared spreadsheet, which can be mailed or faxed to the Georgia Department of Human Resources.C. When Do I Have to Report New Hires? Employers must submit new-hire reports within 10 days of hiring or rehiring an employee. However, employers who report electronically are only required to submit reports in two monthly transmissions, which can be no more than 16 days apart. 55

Chapter 16:Prohibiting Guns atWork and the Employer’sRight to Search EmployeeVehicles

Georgia employers may prohibit their employees from bringing weapons onto the employer’s premisesunder most circumstances, even if the employee has a valid Georgia weapons carry license. However,the employer cannot, in most instances, search locked private vehicles of employees or invited guests inthe employer’s parking lot or its access area, or prohibit employees with a valid weapons carry licensefrom keeping a firearm locked out of sight in a trunk, glove box, or other enclosed compartment in avehicle in its parking area. There are exceptions to this rule which permit the employer to prohibit firearmsin the employer’s secured parking areas that have controlled access, even if the firearms are in enclosedcompartments in vehicles. Some other exceptions are that an employer can prohibit employees fromkeeping firearms in vehicles in the employer’s parking areas if they are defense contractors in certainlocations, or if the parking lots are contiguous to electric generation facilities or natural gas transmission,liquid petroleum transmission, water storage, or law enforcement services facilities deemed vital by theauthorities. Further exceptions are made for car searches with the consent of the employee in connectionwith property-loss investigations, or where firearm restrictions are part of a disciplinary action, or wherethe search is reasonably believed necessary to protect health and safety. 57

Chapter 17:Georgia FirstOffenders Statute

The Georgia First Offender Act places limits on an employer’s ability to rely on or use certain criminalrecords of employees or applicants. The Act establishes a criminal diversion program for individuals whohave not previously been convicted of a felony or certain other crimes. When such a person pleads guiltyor nolo contendere (no contest) to a criminal charge, the court may, in lieu of entering an adjudicationof guilt, place the individual on probation or sentence the individual to a period of confinement. Oncethe individual successfully completes the terms of the probation or is released from confinement, theindividual is completely discharged from the criminal charges without a court adjudication of guilt. Anindividual who successfully completes this program is not deemed to have been convicted of a crime.The Georgia First Offender Act prohibits employers from disqualifying an applicant for employmentbased on the applicant’s discharge from criminal charges pursuant to the criminal diversion program.For example, an applicant who has been discharged from criminal charges pursuant to this program andhas no other criminal record may truthfully answer “no” to a preemployment inquiry as to whether theindividual has ever been convicted of a crime, and the employer may not reject that applicant for lying onthe application about his or her criminal record for so responding.The Georgia Attorney General has construed the antidiscrimination provision of the Georgia FirstOffender Act to bar termination from employment as well as disqualification for employment based ona discharge from criminal charges pursuant to the criminal diversion program. However, the GeorgiaAttorney General has taken the position that an employer may lawfully consider the underlying facts thatsupported the original criminal charges in making personnel decisions. The Georgia Attorney Generalhas also stated that an employer may consider an individual’s guilty plea in connection with the criminaldiversion program as an admission against interest in a subsequent personnel action. 59

Chapter 18:Restrictive Covenants andProtection of ConfidentialInformation

Like many other states, Georgia law will protect employers against the loss of trade secrets andintellectual property. It will also, under some circumstances, permit an employer to place restrictions onunfair competition by former employees.In fact, a Georgia statute adopted in 2011 has greatly strengthened the rights of employers to enforcerestrictive covenants. However, agreements signed before the May 11, 2011 effective date of that statuteare much harder to enforce than those signed since that date.A. Why the Date of the Agreement Matters Prior to the recent efforts of the Georgia General Assembly to increase the enforceability of restrictive covenants, Georgia law was considered unfavorable to these types of agreements. Beginning in 2009, the General Assembly attempted to change the law to make it more favorable to restrictive covenants, and a constitutional amendment and a statute were adopted for this purpose. However, technical issues were raised about the enforceability of the statute itself. Finally, in 2011, the legislature adopted a new statute that did not have the same technical issues. However, the 2011 statute applies only to agreements signed on or after May 11, 2011. Further, some court decisions have indicated that the “old” rules apply to all agreements signed before May 11, 2011. One result of these developments is that employers seeking the protection of restrictive covenants should consider entering into new agreements with the employees they seek to restrict if they do not have agreements signed after May 11, 2011. Doing so will enhance the employer’s chances of enforcing restrictions.B. The New Statute – May 11, 2011 Forward Agreements signed after May 11, 2011 are under the “new” statute and have a greater chance of enforcement. The most important change is that the new statute permits a court to reform an agreement to make it enforceable if it has defects. Under the old law, a seemingly minor defect in one part of an agreement with restrictive covenants could result in the entire restrictive covenant, along with potentially other covenants in the same agreement, being invalided and the employer receiving no protection. The new law provides for restrictive covenants protecting against competition in protected territories, for protection against improper solicitation, and for protection of confidential information. Although it is now easier to satisfy, Georgia law does have limits on the restrictions that are permitted. For example, restrictive covenants cannot be enforced against employees who lack specialized skills or customer or confidential information. Where properly drafted, they may be applied to: • Executives; • Research and development personnel in possession of important confidential information; • Employees in possession of selective or specialized skills, learning, or abilities or customer contacts and information obtained from their jobs; • Certain franchisees, distributors, licensees, or partners. Noncompetition covenants, as opposed to nonsolicitation covenants, are also limited to employees who customarily solicit customers, make sales or obtain orders, manage a department of at least two employees with the ability to hire and fire or influence those decisions, or perform the duties of key employees or professionals. In order to be enforced, noncompetition agreements must be reasonable in time, in the scope of prohibited activities, and in the restricted territory and must have a legitimate business purpose. Nonsolicitation agreements may only apply to solicitation of actual or potential customers with whom the employee had material contact and must be limited to solicitation for products and services that are competitive with those provided by the original employer. Limitations as to customers may substitute for a geographic territory in a restricted nonsolicitation covenant. The new law has certain presumptions, interpretations, and suggested language about what are reasonable restrictions. 61

`Georgia restrictive covenant law remains somewhat complicated, and restrictive covenant agreements should be drafted by counsel to maximize the chances of enforcement.C. Prior Law 1. Noncompetition Although the General Assembly changed the Georgia law regarding restrictive covenants going forward, the prior law still applies to agreements signed before May 11, 2011. Under the prior law, restrictive covenants were not favored. Agreements for which that law is applicable will be upheld only if they are strictly limited in terms of: • the time period in which they bind the employee; • the scope of the conduct prohibited; and • the geographic area in which they bind the employee. There is no specific time limit that is or is not acceptable under the prior law. Time limits must be reasonable in each case. The scope of activities being restricted must be expressed with particularity and should be limited to those activities that the employee actually performed for the employer. When a former employee is prohibited from working for a competitor in any capacity, rather than in the type of work that he/she did for the former employer, the covenant is likely to be found unreasonable. Moreover, an employer usually could not prohibit an employee from engaging in activities in which the employer did not yet engage but in which it might decide to engage at some future date. Georgia also required geographic restrictions for noncompetition provisions under the prior law. This is, of course, a particularly difficult issue in the age of the global market. Geographic restrictions are not permitted to extend beyond the geographic area where the employee worked for the employer. 2. Nonsolicitation Covenants Under Prior Law The prior Georgia law did permit nonsolicitation covenants that were properly drafted. They also had to be reasonable as to time and geographic restrictions. However, a client-based restriction could frequently be substituted for a geographic restriction. Provisions prohibiting the solicitation of employees may also be enforced under some circumstances. These must also be reasonable. Further, the language needs to be carefully drafted so that only solicitation, rather than acceptance of unsolicited employment applications, is prohibited.D. Trade Secrets The Georgia Trade Secrets Act provides protection for the trade secrets of Georgia businesses. In general, the Act defines a trade secret as information (i) that is not commonly known by or available to the public; (ii) has actual or potential economic value to its possessor because others who can obtain economic value by using or disclosing it generally do not know it and cannot readily ascertain it by proper means; and (iii) the possessor has made reasonable efforts to keep it secret. If the information meets these criteria, it is entitled to trade secret protection regardless of whether it is covered by any contract requiring confidentiality. Georgia law also permits the protection of confidential information that does not fall within the trade secret statute. For contractual protection of information that is not a trade secret to be enforced, the information must in fact be confidential, not generally available from public sources, and subject to reasonable efforts by the employer to protect its confidentiality. In Georgia, under the prior law, but not the current statute, the contractual provision giving protection to confidential information that was not a trade secret was required to state a reasonable time limit.62 Georgia Employment Law Handbook

Chapter 19:Drug Testing

A. Introduction Unlike some states, Georgia does not have a statute restricting or regulating drug and alcohol testing by all employers in the state. Therefore, employers in Georgia generally have the latitude to structure their drug and alcohol testing programs free from state regulation. Georgia does, however, have a law that provides a discount in workers’ compensation insurance premiums for employers that voluntarily adopt substance-abuse programs complying with the standards set forth in that law. Georgia also has a statute that requires certain state contractors to adopt drug-free workplace programs meeting certain minimum requirements, although this law does not directly regulate drug and alcohol testing. Georgia employers wishing to administer drug and alcohol tests to employees or applicants may find that their actions are regulated to some extent by federal law. Most employees who drive commercial motor vehicles in commerce or perform safety-sensitive functions with respect to such vehicles are subject to the drug-and-alcohol-testing regulations of the U.S. Department of Transportation. Companies having certain contracts with the U.S. Department of Defense must comply with that agency’s rule requiring drug testing for employees in “sensitive” positions. The U.S. Department of Energy (DOE) also has adopted regulations requiring contractors and subcontractors performing work at DOE facilities to adopt substance-abuse programs that include drug testing for employees in safety-sensitive or security-sensitive positions. Although it does not require or regulate substance-abuse testing, the federal Drug-Free Workplace Act requires certain federal contractors and all recipients of federal grants to adopt programs aimed at keeping illegal drug-related activities out of the workplace. Employment-related drug tests constitute “searches” within the meaning of the Fourth Amendment to the federal constitution, which prohibits unreasonable searches and seizures by governmental entities. Therefore, drug tests administered by public-sector employers are subject to constitutional scrutiny under the Fourth Amendment. Employers with fifteen or more employees are covered by both federal and Georgia disability- discrimination laws and must ensure that their drug-and-alcohol-testing programs comply with these laws, although only the federal law appears to have any direct impact on such tests. Employees in Georgia who are injured on the job because they are under the influence of alcohol or illegally used drugs are disqualified from receiving workers’ compensation benefits, and a positive result on a drug or alcohol test meeting certain standards creates a rebuttable presumption that drug or alcohol intoxication caused the injury. Similarly, a discharge or suspension for violating an employer’s drug-free workplace policy disqualifies an employee from receiving unemployment compensation benefits in Georgia, and a positive result on certain substance-abuse tests creates a presumption that the employee is in violation of the employer’s policy.B. The Georgia Workers’ Compensation Drug-Free Workplace Law The Georgia Workers’ Compensation Act contains provisions granting employers a 7.5 percent discount in workers’ compensation insurance premiums if they voluntarily adopt and maintain a substance-abuse program satisfying certain statutory standards. These provisions, commonly referred to as the Georgia Workers’ Compensation Drug-Free Workplace Law, establish detailed requirements for adopting a substance-abuse policy, administering substance-abuse tests of applicants and employees, conducting employee education programs and supervisory training on substance abuse in the workplace, providing assistance to employees with substance abuse problems, and maintaining the confidentiality of information obtained from substance-abuse testing. Although the Georgia Workers’ Compensation Drug-Free Workplace Law imposes substantial obligations on employers who choose to take advantage of the discount in workers’ compensation premiums, participation in the workers’ compensation substance-abuse program is entirely voluntary, and the law imposes no restrictions on employee or applicant substance-abuse testing by employers who choose not to participate in the program.64 Georgia Employment Law Handbook

Employers wishing to obtain the 7.5 percent discount in workers’ compensation premiums mustadopt a workplace substance-abuse program that satisfies statutory requirements, and the programmust be certified by the State Board of Workers’ Compensation as being in compliance with thoserequirements. The basic requirements for a substance-abuse program are as follows:1. A Written Policy on Substance Abuse in the WorkplaceThis policy statement must identify the circumstances in which the employer will conduct substance-abuse testing, state the actions that the employer may take on the basis of a positive test result oran individual’s refusal to submit to testing, specifically refer to the statutory basis for the program,contain an assurance of confidentiality for information gathered through substance-abuse testing,inform employees and applicants of their right to contest or explain a positive test result, informemployees of the employer’s resources for substance-abuse assistance, and inform employees andapplicants of the federal Drug-Free Workplace Act if it applies to the employer.2. Notice of the Drug-Free Workplace ProgramEmployers must notify employees of the existence of the substance-abuse program by distributinga copy of the written policy statement to employees at least sixty days before the implementation oftesting pursuant to the program. In addition, employers must notify applicants about the substance-abuse program by including a notice of substance-abuse testing in vacancy announcements forpositions subject to testing, by posting a notice of substance-abuse testing in a conspicuous locationon the employer’s premises, and by making copies of the written policy statement available toapplicants in the employer’s personnel office or other suitable location. In addition to the foregoingrequirements, employers must give an employee or applicant a notice of substance-abuse testingbefore administering a test, but this is a one-time-only requirement that does not have to berepeated each time a particular individual is required to undergo testing.3. Substance-Abuse TestingAn employer participating in the Georgia workers’ compensation drug-free workplace program mustconduct substance-abuse testing in the following circumstances:• Applicant Testing. An employer must either test all applicants who have received an offer for employment or test only those applicants seeking jobs in certain reasonably selected categories (for example, applicants for safety-sensitive positions) after they have received an offer for employment.• Reasonable Suspicion Testing. An employer must test any employee when it reasonably suspects the individual is impaired by drugs or alcohol. The employer must document in writing the circumstances that form the basis of the reasonable suspicion, and a copy of this documentation must be given to the employee upon request.• Post-Accident Testing. The employer must test any employee who has caused or contributed to an on-the-job injury that resulted in a loss of work time.• Routine Fitness for Duty Testing. If the employer requires periodic physical examinations for employees in certain jobs, the examinations must include a substance-abuse test.• Follow-Up Testing. If an employee involuntarily enters an employee assistance program or rehabilitation program as a result of a positive substance-abuse test, the employer must conduct follow-up testing of that employee at least once a year for two years after the employee completes the employee assistance program or rehabilitation program. 65

Random testing is not required by the Georgia Workers’ Compensation Drug-Free Workplace Law, but employers are free to implement such testing if they wish. All substance-abuse testing conducted pursuant to the Law must comply with the detailed standards for testing set forth in the Law and its implementing regulations, and the employer must pay for the tests required by the Law. Within five working days after the employer’s receipt of positive, confirmed test results from the testing laboratory, the employer must provide the employee or applicant with written notice of the positive test results, the consequences of such results, and the options available to the employee or applicant. The employer must provide the employee or applicant with a copy of the test results upon request. The Law does not require the termination of employees who test positive, and employers adhering to the Law may impose lesser discipline, such as a suspension, or require an employee to participate in a substance-abuse treatment program. To minimize the risk of discrimination claims, however, employers should be consistent in their reactions to positive test results. Once employees are notified of a positive test result, they have five working days to contest or explain the result, but the Law does not require employers to refrain from taking adverse employment action based on the positive test result during that five-day period. 4. Employee Assistance Resources The Georgia Workers’ Compensation Drug-Free Workplace Law does not require employers to maintain an employee assistance program — that is, a formal program offering assistance to employees with non-work-related problems such as substance abuse. However, if an employer has an employee assistance program, the Law requires employers to inform employees of the benefits and services of the program and to provide employees with notice of the procedures for accessing and using the program. Employers that do not have an employee assistance program must maintain a resource file of providers of employee assistance, including drug and alcohol abuse programs, mental health providers, and other persons or organizations that can assist employees with personal or behavioral problems. Employers maintaining such a resource file must notify employees in writing of the availability of the resource file and must post in the workplace a current listing of providers of employee assistance in the local geographic area. An employer’s resource file of employee-assistance providers must be reviewed and updated each year during the month of July. 5. Employee Education About Substance Abuse During the first year of an employer’s participation in the program established by the Georgia Workers’ Compensation Drug-Free Workplace Law, the employer must provide all employees with a semiannual education program on substance abuse. This program must include an explanation of the disease model of addiction for alcohol and drugs, a discussion of the effects and dangers of commonly abused substances in the workplace, an explanation of the employer’s policies and procedures regarding substance abuse in the workplace, and an explanation of how employees who wish to obtain substance-abuse treatment can do so. After the initial year of participation in the program, the employer must provide all employees with an annual education program regarding substance abuse. 6. Supervisory Training Regarding Substance Abuse During the first year an employer is participating in the program established by the Georgia Workers’ Compensation Drug-Free Workplace Law, the employer must provide supervisors with at least two hours of training regarding substance abuse. This training, which is in addition to the general employee education program discussed above, must include such topics as recognizing signs of employee substance abuse, documenting and corroborating signs of employee substance abuse, and referring employees to the appropriate treatment providers. After the initial year of participation in the program, the employer must provide at least one hour of supervisory training about substance abuse each year. To qualify for the 7.5 percent discount in workers’ compensation premiums, an employer must submit a written program complying with the statutory requirements to the Georgia State Board of Workers’ Compensation. Upon determining that the employer’s program complies with the statutory requirements, the Board will issue a certification that the employer may submit to its insurer to obtain the discount in premiums. An employer must have its program recertified annually to continue qualifying for the premium discount.66 Georgia Employment Law Handbook

C. Disqualification from Workers’ Compensation Benefits Based on a Positive Substance-Abuse Test The Georgia Workers’ Compensation Act disqualifies employees and their survivors from the receipt of workers’ compensation benefits for workplace injuries or deaths due to intoxication by alcohol or being under the influence of marijuana or other unlawful controlled substances. The Act creates a rebuttable presumption that an injury or death was caused by the use of alcohol or controlled substances if a post-accident substance-abuse test shows a blood-alcohol concentration of 0.08 grams or higher within three hours after the accident or any amount of marijuana or another controlled substance in the employee’s blood, urine, or other bodily substance within eight hours after the accident. A positive test result caused by the use of lawfully prescribed medications will not raise the rebuttable presumption of causation, but an employee’s refusal to submit to a post- accident drug or alcohol test meeting certain standards of reliability will raise the presumption. When the rebuttable presumption of causation arises, the employee or his or her survivors have the burden of proving that drug or alcohol use was not a contributing factor to the workplace accident. The provisions of the Georgia Workers’ Compensation Act regarding disqualification from benefits based on drug or alcohol use are totally separate from the Georgia Workers’ Compensation Drug- Free Workplace Law discussed above. Thus, the disqualification provisions apply to employees regardless of whether their employers are participating in the premium-discount program under that Law.D. Disqualification from Unemployment Benefits Based on a Positive Drug Test The Georgia Employment Security Law disqualifies from the receipt of unemployment compensation benefits employees who have been discharged for violating an employer’s drug- free workplace policy. Ordinarily, the employer has the burden of proving that the discharged employee violated the drug-free workplace policy. However, when the employee fails a drug test administered pursuant to the policy, the employer’s burden is presumed to be met if the employer’s policy complies with the provisions of the Georgia Workers’ Compensation Drug-Free Workplace Law, with other equivalent or more stringent standards for testing established by federal law or regulations, or with rules and regulations prescribed by the Georgia Commissioner of Labor. Regulations issued by the Commissioner of Labor require the use of “proper” custody, testing, and confirmation procedures in connection with drug testing, but do not specify what those procedures are other than to mandate that different testing methods must be used for an initial test and a confirmatory test unless gas chromatography technology is used for the initial test. The regulations also specify that an employee who is discharged for refusing to participate in an employer’s reasonable drug-testing program is disqualified from receiving unemployment compensation benefits.E. Requirements for Federal and State Contractors Employers with a federal contract in the amount of more than $100,000 and all recipients of federal grants are subject to the federal Drug-Free Workplace Act of 1988, which does not require drug or alcohol testing, but which does require covered employers to implement certain measures aimed at eliminating illegal drug-related activity in the workplace. Specifically, the Act requires covered employers to publish and distribute a policy statement informing employees that the unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited in the employer’s workplace. The employer must also establish a drug-free awareness program to educate employees about the dangers of drug abuse in the workplace, the employer’s policy of maintaining a drug-free workplace, the existence of any employee assistance programs that may be available to employees, and the penalties that may be imposed for drug-abuse violations. The Act requires covered employers to impose an appropriate employment sanction (up to and including termination) on employees who are criminally convicted of a workplace drug offense or to require such employees to participate satisfactorily in a drug-abuse assistance or rehabilitation program. 67

Georgia has its own Drug-Free Workplace Act, which, like its federal counterpart, does not require drug testing, but does impose obligations on certain state contractors to maintain a drug-free work environment. The Georgia law applies to employers having public works contracts with a state agency in the amount of at least $25,000 and to employers providing goods, materials, services, or supplies to a state agency pursuant to a multiyear purchase or lease contract in the amount of at least $25,000. Covered employers are required to issue and distribute a drug-free workplace policy statement and to establish a drug-free awareness program to educate employees about drug abuse in the workplace. The requirements for the policy statement and the drug-free awareness program under the state law are identical to the requirements discussed above in connection with the federal Drug-Free Workplace Act.F. Impact of Federal and State Disability-Discrimination Laws The federal Americans with Disabilities Act (ADA) prohibits employment discrimination based on a disability. Although alcoholism may qualify as a disability under the ADA, that law expressly excludes from protection the current, illegal use of drugs. Thus, an employer ordinarily would not violate the ADA by discharging an employee for testing positive on a test designed to detect current, illegal drug use (for example, a urinalysis test or a blood test). The ADA similarly would permit an employer to reject an applicant for employment based on a positive result on a pre-employment test for current, illegal drug use. Although alcoholism may constitute a protected disability under the ADA, that law permits employers to prohibit employees from working under the influence of alcohol, and consequently, the ADA would generally permit an employer to terminate an employee for testing positive on a properly administered alcohol test that indicates on-the-job intoxication. In addition to prohibiting disability discrimination, the ADA restricts the circumstances in which an employer may administer a medical examination to applicants and employees. An alcohol test, such as a breathalyzer test or a blood test, constitutes a medical examination for ADA purposes and is subject to the statutory restrictions. Under those restrictions, an employer may administer a pre- employment medical examination only after the employer has extended a conditional job offer to the applicant and after the employer has completed all nonmedical investigations of the applicant. Employers may require current employees to submit to a medical examination only when the examination is job-related and consistent with business necessity. In the alcohol-testing context, this standard generally means that the alcohol test must either be required by federal law or based on a reasonable suspicion that the employee is under the influence of alcohol at work. Alcohol tests in other situations, such as random testing and suspicionless post-accident testing, may not satisfy the “job-related and consistent with business necessity” standard and may be risky when not required by federal law. When alcohol tests are permitted by the ADA, the results of such tests must be treated as confidential medical information and must be kept separate from the employee’s general personnel file.68 Georgia Employment Law Handbook

Tests to determine current, illegal drug use are in a different category from alcohol tests under theADA. That law expressly excludes such drug tests from the definition of “medical examination.”Therefore, the ADA does not restrict the timing or circumstances in which an employer may requirean applicant or employee to submit to a test to determine current, illegal drug use. Although theADA does not require employers to treat drug test results as confidential medical information, it isnevertheless a good business practice to do so.On the state level, the Georgia Equal Employment for Persons with Disabilities Code prohibitsemployment discrimination based on a disability, but it expressly excludes addiction to alcoholand drugs from the definition of “disability.” Thus, individuals who are drug addicts or alcoholicsare not protected by the Georgia disability-discrimination law on the basis of those conditions.Moreover, unlike the ADA, the Georgia disability discrimination law does not restrict the timing orcircumstances of medical examinations by employers. Therefore, that law does not restrict theadministration of alcohol and drug tests. Because the Georgia Equal Employment for Persons withDisabilities Code and the ADA both apply to employers with fifteen or more employees, however, theabsence of restrictions on substance-abuse tests under the Georgia disability-discrimination law willbe of no practical benefit for covered employers, who must still comply with the restrictions imposedby the ADA. 69

Chapter 20:Right to Work Statute(Prohibition Against Compelling Union Membership)

Georgia is a “right to work” state. This means that employers and labor unions cannotforce employees to join a union or pay union dues as a condition of employment orcontinued employment.Although the National Labor Relations Act controls most aspects of company-unionrelations, it does permit states to enact “right to work” laws, and Georgia has done so.Under the Georgia statute: (1) membership or nonmembership in a labor organizationcannot be a condition of employment; (2) payments to a labor organization cannot bea condition of employment; and (3) contracts requiring such memberships or paymentsare void and illegal. The remedies available include actual damages, injunctive relief,attorneys’ fees, and other equitable remedies. 71

Chapter 21:Strike Violence andMass Picketing

Unfortunately, labor disputes sometimes involve misconduct by strikers and picketers that is intendedto block worksite entrances and generally disrupt the business of the employer. Georgia law deals withthis problem through statutes prohibiting violence, threats, obstruction of vehicles, and interference withroads.While most aspects of a typical labor dispute in the private sector are subject to federal law (in mostinstances, the National Labor Relations Act), states are left with the power to regulate strike violence,and Georgia law addresses this problem. Under the Georgia Code, it is unlawful to interfere with publicways of travel or transportation by mass picketing (i.e., picketing in such numbers as to obstruct roadsand entrances) and related conduct. It is unlawful to obstruct or interfere with entrance to or egressfrom a place of employment. Also prohibited is the use of force or threats to compel anyone to departfrom employment. It is also unlawful to attempt to use force, intimidation, violence, or threats to preventanyone from engaging in a lawful vocation or engaging in proper business activity. Violations of theseprohibitions can be considered criminal conduct, and may give rise to civil liability as well.When violence occurs or is threatened in connection with a strike, the employer may seek relief instate court, but there are few hard and fast rules regarding strike violence. The courts will look at eachfactual situation and determine what is necessary. There have been occasions when courts havelimited picketing to two picketers at a time with the place of picketing itself being limited. However, thisis not a set rule, and such restrictions are not likely to be imposed unless they appear to the court to benecessary to remedy a serious situation, usually when significant violence or obstruction has alreadyoccurred.If there has been sufficient misconduct, Georgia courts will sometimes grant emergency relief on anexpedited basis to address the situation. Thus, a temporary restraining order or preliminary injunction cansometimes be obtained if the proper evidentiary showing is made. 73

Chapter 22:Negligent Hiring,Supervision, and Retention

Under Georgia law, an employer can be liable for negligent hiring, supervision, orretention of an employee. Such negligence can result in tort damages. Althoughthe typical physical injury at work of one employee due to the negligence of a fellowemployee of the same business will be handled in the workers’ compensation context,negligent selection, supervision, and retention claims can arise in a number of situatons.Such claims are typically made when an employee of a business injures a nonemployee.Situations in which the employee will have access to customers at home or in private orto disabled or vulnerable individuals are areas of particular scrutiny. However, there is nospecific limit on the circumstances in which these issues can arise.Background checks are a good precaution in many circumstances, and individualswith criminal backgrounds or violent histories are appropriate for particular scrutiny.However, employers should be careful about automatic disqualifications, which can raisediscrimination issues, and each instance should be reviewed carefully and individually.Some employers, such as nursing homes, certain medical facilities, and day careand child care centers are required to conduct criminal background checks on certainemployees. 75

Chapter 23:OSHA – Occupational Safetyand Health

The Occupational Safety and Health Act of 1970 (the “Act”) requires employers to provide safe andhealthful working conditions. With the approval of and supervision by the Occupational Safety andHealth Administration (“OSHA”), many states have developed their own occupational safety and healthprograms. Georgia has no such state program. Thus, employers operating in Georgia must look to thefederal law.As required by the Act, OSHA issues safety and health standards with which employers must comply, inthe absence of a variance. The standards are detailed and address myriad situations. However, even inthe absence of a specific standard, the Act imposes on all employers the general duty to furnish to eachemployee a place of employment “free from recognized hazards that are causing or are likely to causedeath or serious physical harm to … employees.”OSHA inspectors will perform workplace inspections either upon their own choosing or as the result ofan accident or request for inspection. OSHA inspectors will not give advance notice of these inspections.However, if an employer requires, the inspector must have a warrant – something they can normallyobtain.Upon finding violations, OSHA inspectors will issue citations to the offending employer. In the eventan employer disagrees with the citation, the employer has fifteen working days to contest the citationor it becomes a final order and is not subject to review. Once a citation becomes final, it is then onthe employer’s record and will lead to a repeat violation (which includes increased penalties) shouldthe employer violate the same standard at any location. Deciding how to handle citations can be veryimportant to a business as the fines can go as high as $70,000 for each violation, and willful violationsmay result in criminal penalties up to and including imprisonment.Once an employer receives an OSHA citation, the clock runs quickly on the time to contest and, ifnecessary, to litigate. Additionally, settlement of an OSHA citation calls on an employer to admit theunderlying violation and therefore exposes the employer to future repeat violations should they engage inthe same or similar conduct. Employers are well-advised to consult an attorney familiar with the Act in theevent OSHA comes knocking. 77

Chapter 24:Medical Benefits Continuation –COBRA and Georgia Law

A. Federal COBRA Requirements A federal law referred to as COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1985) mandates the continuation of group health plan benefits when certain events, such as employment termination, occur. In certain situations, these events trigger notice and coverage requirements, including the right to purchase continuation coverage for periods that can range from 18 to 36 months. COBRA typically applies to group health plans maintained by private-sector employers with at least 20 employees (as well as by state and local governments). Medical, dental, and vision plans and health care flexible spending accounts are examples of group health plans that may be subject to COBRA. In addition to the federal requirements, Georgia also imposes continuation of coverage requirements on certain group health insurance policies issued or delivered in Georgia (referred to here as “Georgia COBRA”). Failure to comply with the various requirements of COBRA can subject the employer to a civil penalty under the Employee Retirement Income Security Act (ERISA) of up to $110 per day for each failure to provide the required notice and an excise tax under the Internal Revenue Code. Also, failure to offer the continuation coverage under COBRA or Georgia COBRA could result in liability for the employer in the amount of unreimbursed medical expenses incurred by a former participant. Therefore, it is important for employers to understand their obligations and not to assume that the insurer is complying with COBRA on their behalf. 1. Qualifying Events That Trigger COBRA Rights COBRA requires that continuation coverage be provided when certain events, called “qualifying events,” occur, resulting in a loss of coverage for a “qualified beneficiary.” The term “qualified beneficiary” includes most individuals who are covered by the plan on the day before the qualifying event, such as employees and their spouses and dependents. It can also include retirees, independent contractors, and children born or adopted during the COBRA period. Domestic partners typically are not qualified beneficiaries, unless they are dependents under the Internal Revenue Code. The principal qualifying events that trigger COBRA coverage for a covered employee (as opposed to a spouse or dependent child) are (1) termination of the employee’s employment other than for gross misconduct and (2) reduction in the employee’s hours of employment. The following are qualifying events for the spouse and dependent child of a covered employee if the events cause the spouse or dependent child to lose coverage: (1) termination of the covered employee’s employment other than for gross misconduct; (2) reduction in the hours worked by the covered employee; (3) the covered employee becomes entitled to Medicare (though this event typically does not result in the loss of coverage); (4) divorce or legal separation of the spouse from the covered employee; (5) death of the covered employee; and (6) loss of dependent status (such as due to age). 2. Limited Exceptions If an employee is terminated from employment for gross misconduct, COBRA coverage is not required. However, legal advice should be sought before determining that a termination of employment was due to “gross misconduct” for purposes of COBRA because courts have been quite strict in interpreting this term. As stated above, the general rule is that COBRA coverage is required only if the individual was covered under the group health plan on the date immediately preceding the qualifying event. There are certain exceptions to this rule. If an employee drops health coverage during leave covered by the Family and Medical Leave Act (FMLA) and does not return to employment following the end of that leave, a qualifying event occurs at the end of the FMLA leave, and the qualified 79

beneficiary is entitled to elect COBRA coverage if that individual was covered under the plan on the day immediately preceding the FMLA leave. In addition, if an employee drops a spouse from group health coverage in anticipation of a divorce or legal separation, that spouse will have the right to COBRA coverage beginning on the date of the divorce or legal separation (coverage is not retroactive to the date on which coverage was actually dropped in anticipation of the divorce). 3. Notice Requirements a. Initial Notice Employers must give each employee and covered spouse an initial notice within the first 90 days of coverage under the plan. The Department of Labor has provided a model notice at www.dol.gov/ ebsa/modelgeneralnotice.doc. This notice was recently updated to include information about the availability of individual policies through the new Health Insurance Marketplace implemented under the Affordable Care Act. b. Notice of the Qualifying Event When a qualifying event occurs, the event must be reported to the plan so that COBRA coverage may be offered to the participant. Employers must notify the plan within 30 days if the qualifying event is a termination, reduction in hours, death of the participant, or participant becoming entitled to Medicare. The employee must notify the plan administrator (usually the employer) if the qualifying event is a divorce, legal separation, or loss of dependent status. The plan should have procedures in place for the participant to follow when notifying the plan of such qualifying events. c. Election Notice Once the plan has notice of the qualifying event, the plan has 14 days to provide the participants with an election notice (the Department of Labor provides a model election notice at www.dol.gov/ ebsa/modelelectionnotice.doc). This notice was recently updated to notify individuals that they may be eligible to purchase a policy through the Marketplace that costs less than COBRA and to explain the election period for coverage through the Health Insurance Marketplace. Employers should confirm their notices have been updated to include information about the Marketplace and the restrictions on switching to coverage through the Marketplace once COBRA is elected. Once the COBRA election notice is received, qualified beneficiaries have an election period of at least 60 days in which to determine whether or not to elect COBRA coverage, beginning on the later of the date the participant loses coverage under the plan or the date the election notice is provided to the participant. COBRA coverage, if elected, is retroactive to the date of the qualifying event, while coverage through the Marketplace is not retroactive. 4. Additional Notice Requirements If an employee or dependent provides notice that a qualifying event has occurred (thereby indicating an expectation that COBRA continuation coverage is available), but COBRA coverage is not available to that individual, the plan administrator (usually the employer) must send a notice of the unavailability of COBRA coverage within 14 days of receiving the notice from the employee. In addition, if COBRA terminates prior to the end of the maximum COBRA period (such as due to failure to pay premiums or coverage under another health plan), the employer must send notice of the early termination as soon as practicable after coverage is terminated. 5. Benefits and Cost of Coverage COBRA coverage must be identical to that offered prior to the qualifying event or to that offered to similarly situated employees, including deductibles and coverage limits. If benefits change for similarly situated employees, the same changes are applicable to COBRA participants. During open enrollment periods when similarly situated participants are making coverage decisions, the same coverage decisions must be made available to COBRA participants. The plan can require contributions for coverage up to a maximum of 102% of the cost of the coverage (although up to 150% can be charged for those extending coverage due to disability, described below).80 Georgia Employment Law Handbook

6. Period of Coverage Continuation coverage normally lasts up to 18 months in the event of the termination of employment or reduction in hours or 36 months in the event of divorce or legal separation, death of the employee, or loss of dependent child status under the plan. However, there are times when an initial 18-month COBRA period of coverage can be extended. For example, if a terminated employee is determined to be disabled by the Social Security Administration (and the required notices are provided), COBRA coverage can be extended an additional 11 months, for a total of 29 months of coverage. If a second qualifying event occurs during the initial 18 months of COBRA (such as a divorce following a termination of employment), COBRA coverage may be available for up to a total of 36 months.B.Georgia COBRA Requirements In addition to the federal COBRA requirements, Georgia imposes additional requirements that apply to group health insurance policies. Although employers with fewer than 20 employees are not subject to COBRA, the Georgia COBRA rules do apply to these small employers and require that insured plans allow participants who have been covered under the plan for at least six months before the termination of coverage to extend the coverage for the remainder of that calendar month plus three months. The participant can be charged up to 100% of the cost of coverage. This three- month extension is not available to participants who are terminated for cause, whose coverage terminated due to failure to pay a required premium or fraud, or whose coverage is replaced by similar coverage. Georgia also requires that an insured health plan issued or delivered in Georgia and subject to federal COBRA allow participants who have been covered under the policy for at least six months to continue their coverage after federal COBRA would otherwise terminate if their continuation coverage begins when they are age 60 or over. This extended continuation coverage is not available if the participant voluntarily terminated employment for reasons other than health, was terminated due to gross misconduct, or failed to pay premiums; if similar replacement coverage is obtained; or if the group contract is terminated. Similar extended continuation coverage is available to a former spouse who is at least age 60 at the time of the employee’s death or divorce. This extended continuation coverage under state law terminates on the earliest of the date the individual fails to pay the required premium, the date the group plan is terminated (with certain exceptions), the date the individual becomes insured under another group health plan, or the date the individual becomes eligible for Medicare. Employers with a group health insurance policy issued or delivered in Georgia should carefully review their policies to ensure they understand these coverage requirements. 81

Chapter 25:Workers’ Compensation

A. Coverage The Georgia Workers’ Compensation Act (the “Act”) provides state-specified wage-replacement and medical expense benefits to employees who experience a compensable work-related injury or illness. The Act covers most employers with three or more employees. Exceptions to workers’ compensation coverage include railroad workers, farm laborers, and domestic workers.B. Exclusive Remedy The Georgia Workers’ Compensation Act (the “Act”) generally provides the exclusive remedy against employers for injuries suffered by an employee in the course of employment. Although the remedy provided under the Act usually precludes an employee from bringing negligence claims against his/her employer for covered, work-related injuries, the Act has also been interpreted to bar an employee from suing his/her employer for injuries stemming from intentional torts when those injuries are otherwise compensable under the Act. The Act does not bar an injured employee from suing a third party for injuries that stem from that party’s negligence (unless the party is an employee of the employer). Moreover, the employer may be able to recover workers’ compensation expenses from the third party through a subrogation lien once the injured employee has been fully compensated.C. Compensable Injuries and Diseases An injury that is compensable under the Act is one that arises (1) out of and (2) in the course of the employment. Therefore, an injury that occurs while an employee has deviated from the course of his or her employment is generally not compensable. Certain “occupational diseases” may be subject to coverage. These are diseases that are “due to causes and conditions that are characteristic of and particular to the particular trade, occupation, process, or employment in which the employee is exposed….” Diseases “naturally and unavoidably” arising from a covered accident may also be covered. Many diseases, such as heart disease, drug addiction, and alcoholism, are generally not compensable, however.D. Frequent Changes Georgia has a Workers’ Compensation Advisory Council that frequently proposes changes in the details of the workers’ compensation requirements to the General Assembly, and these changes are often adopted. It is therefore important that employers check with their workers’ compensation insurance provider or administrator for up-to-date details. The following is a general description of some of the details of the system at the time of this writing.E. Compensation The Workers Compensation Act provides for compensation for lost wages as well as payment of medical expenses. These requirements are subject to certain limits and caps. There is, for example, a limit of 400 weeks on the number of weeks that the employer must provide medical benefits for noncatastrophic injuries. When an injury is compensable under the Act, the employer must provide, or make arrangements through an appropriate carrier to provide, compensation for medical, surgical, and hospital costs as well as vocational rehabilitation. Payment of these expenses is mandated when they “shall be reasonably required and appear likely to effect a cure, give relief, or restore the employee to suitable employment.” The determination as to what is “reasonably required” is made by the State Board of Workers’ Compensation, subject to caps in some instances. 83

Additionally, the employee must be compensated for lost wages. This is generally calculated based on the employee’s average weekly wages earned in the thirteen weeks preceding the injury. Wage compensation under the Act is generally divided into four categories: compensation for temporary total disability; compensation for temporary partial disability; compensation for permanent partial disability; and compensation for death. They are subject to various limitations under the Act. It is worth noting that with regard to compensation for a temporary total disability or a temporary partial disability, “disability” is defined as an impairment of earning capacity and not a physical impairment. In other words, compensation is determined by the extent to which the employee’s injury prevents him/her from earning wages and not by the severity of the injury. By contrast, compensation for a permanent partial disability is tied to the actual, physical impairment, such as the lost use of a body member, and the amount of compensation varies according to the degree of loss. New legislation has placed caps on the medical benefits available for some injuries. Employees can receive lifetime medical benefits, where they otherwise qualify, for injuries occurring on or before June 30, 2013. However, medical benefits for noncatastrophic injuries after July 1, 2013 are capped at 400 weeks from the date of the accident. If the injury is considered catastrophic, the cap will not apply.F. Procedure The injured employee is required to give the employer notice of a work-related injury within thirty days. The notice may be in writing or in person. If the employee is incapable of giving notice, or if the employer knows of the accident, notice may be waived by the State Board of Workers’ Compensation. Immediately upon knowledge of an injury, the employer must file with the insurer (or self-insurer’s claims office) an Employers’ First Report of Injury or Occupational Disease. Injuries involving seven or more days of lost time must be reported to the Board within twenty-one days of the employer’s knowledge of disability. If the employer and the injured employee do not agree as to compensation, either may file a claim with the State Board of Workers’ Compensation. Normally, the matter will be referred to an administrative law judge for a hearing. When an injured employee’s period of disability ends, the employer is required to file a report with the Board.G. Poster Georgia law requires that a covered employer post in a “conspicuous place or places in and about the place or places of business” a poster regarding workers’ compensation, including the Workers’ Compensation Bill of Rights for the Injured Worker. The Board provides the poster. It must include information about the employer’s insurance carrier.H. Insurance Covered employers must either obtain workers’ compensation insurance or qualify for self- insurance. Even those employers that self-insure normally obtain the assistance of a third party administrator to administer the workers’ compensation program. Small businesses often look to the insurer to provide information and advice concerning the handling of claims and procedures under the Workers’ Compensation Act.84 Georgia Employment Law Handbook

Chapter 26:Wage and Hour Requirements

This chapter briefly and generally explains the wage and hour requirements that Georgia and federal lawsimpose on Georgia employers.A. Georgia Minimum Wage Law The Georgia Minimum Wage Law provides that employers in Georgia must pay their employees at least $5.15 per hour. However, the Georgia minimum wage law does not apply to employees covered by the Fair Labor Standards Act when the minimum wage provided for in the Fair Labor Standards Act is greater than the Georgia minimum wage. Because the minimum wage mandated in the Fair Labor Standards Act is $7.25 per hour at the time of this writing, the Georgia minimum wage law presently does not affect most employers. If the Georgia minimum wage law does apply, it exempts from its requirements employers that have annual sales of $40,000 or less, employers with five or fewer employees, employers of domestic employees, employers who are farm owners, share croppers, or land renters, tipped employees, employees who are high school or college students, employees who are newspaper carriers, or certain employees who are resident child care or nursing care providers.B. The Fair Labor Standards Act of 1938 1. Overview The Fair Labor Standards Act of 1938 (“FLSA”) and its regulations provide standards for minimum wages, overtime compensation, recordkeeping, child labor, and equal pay. It also regulates how employees must be compensated. 2. Coverage The FLSA covers employees of “enterprises.” Employees of an enterprise are covered if the enterprise annually grosses at least $500,000 and is either engaged in interstate commerce, produces goods for interstate commerce, or has employees who handle, sell or otherwise work on goods or materials that have been moved in or produced for commerce by any person. Employees of an enterprise are also covered if the enterprise is a hospital, provides medical or nursing care for residents, is a school, or is a government agency. The FLSA also covers individual employees who are engaged in commerce or in the production of goods for commerce. Under the FLSA, “commerce” is defined as “trade, commerce, transportation, or communication among the several States or between any State and any place outside thereof.” A court will consider an individual to be engaged in commerce if the individual’s work relates to the actual movement of commerce, the individual regularly uses the channels of commerce, or the work is related to the instrumentalities of commerce. However, the FLSA only applies when there is an employer-employee relationship. The definition of an employee in the FLSA is very broad. An “employee” is “any individual employed by an employer.” Additionally, the FLSA defines the term “employ” as to “suffer or permit to work.” Generally, a court’s inquiry into whether an employer-employee relationship exists is focused on the economic realities of the relationship. The “economic realities” test focuses on whether the individual is economically dependent on the alleged employer or is in business for himself or herself. A court will be less concerned with contractual terminology or with common law agency concepts.86 Georgia Employment Law Handbook

3.The FLSA’s Requirements a. Minimum Wage Requirements The FLSA requires employers to pay their employees at least $7.25 per hour effective July 24, 2009. If Georgia law mandates a higher minimum wage, that rate applies to all nonexempt employees in Georgia. There are exceptions to the minimum wage requirement. Employers with newly hired employees under the age of 20 may pay those employees an “opportunity wage” of $4.25 per hour for the first 90 consecutive days of employment. However, an employer cannot displace other employees to hire employees under age 20. Employers can also apply toward satisfaction of an employee’s minimum wage the “reasonable cost” of providing the employee with board, lodging, or other facilities, furnishing meals to the employee, and providing the employee with transportation from home to work, provided that the employer makes no profit. Additionally, employers can deduct from an employee’s minimum wage federal, state, and locals taxes, payments owed to a third person pursuant to a court order, payments assigned to a third party provided that the employee has consented, and repayments owed to the employer for a loan from the employer. Under the FLSA, an employer is permitted to credit tips against a “tipped” employee’s minimum wage. A “tipped” employee is any employee engaged in a job in which he or she customarily and regularly receives more than $30 a month in tips. The employer must pay a tipped employee at least $2.13 per hour and it can credit tips received by the employee in cash or the equivalent to fulfill the remaining minimum wage requirement. However, the allowed credit against the employee’s minimum wage cannot exceed the value of the tips actually received. b. Overtime Requirements Under the FLSA, covered employers are required to pay all employees at least one and half times their “regular rate” for each hour, or fraction of an hour, worked in excess of 40 hours during any workweek, unless otherwise exempt. A single workweek is the standard and the FLSA does not allow employers to average hours over 2 or more weeks, except for hospital employees, fire protection employees and law enforcement employees. An employee’s regular rate cannot be less than minimum wage and ordinarily is calculated each workweek by dividing the total remuneration an employee is paid, with eight specific exclusions, by the total number of hours actually worked during the workweek. Nondiscretionary bonuses for accuracy, good attendance, continued employment, and for quality or quantity of work are included in an employee’s remuneration when determining the employee’s regular rate. However, premium pay for overtime and holiday work, discretionary bonuses, and payments for vacation or illness or similar payments for hours not worked are not included in the employee’s total compensation and should not be used to determine the employee’s regular rate. c.Exemptions (i) Timekeeping, Minimum Wage Overtime Exemptions The FLSA and its regulations provide that employees who work in certain industries or positions are exempt from certain timekeeping, minimum wage, and overtime requirements. The burden of showing that an employee is exempt always lies with the employer. The most common category of timekeeping, minimum wage, and overtime exemptions are “white-collar” exemptions. They are exemptions for bona fide executive, administrative, and professional employees, computer professionals, highly compensated employees, and outside sales people. 87

To qualify for the executive exemption, the employee must receive a salary of no less than $455 per week, primarily manage the enterprise or a recognized subdivision thereof, direct the work of at least two other full-time employees, and have the authority to effect status changes of other employees or whose recommendations regarding status changes for other employees are given particular weight. The administrative exemption requires that the employee receive a salary of no less than $455 per week, primarily perform office or nonmanual work directly related to the management or business operations of the employer or of customers, and exercise discretion and independent judgment with respect to matters of significance. To qualify for the non-academic professional exemption, the employee must receive a salary of no less than $455 per week and must primarily perform work that requires knowledge of an advanced type acquired through a prolonged course of specialized study or requires invention, imagination, or talent in a recognized field of artistic endeavor. Highly skilled computer professionals are also exempt if they are paid at least $27.63 per hour and their primary duties include the application of systems analysis and techniques, the design, creation, or modification of computer systems, the design or creation of computer programs related to machine operating skills, or a combination of these duties. This exemption does not cover junior programmers or other computer operators. The exemption for highly compensated employees applies to employees with a total annual compensation of at least $100,000 who perform one or more of the exempt duties of an executive, administrative, or professional employee described above. An “outside salesperson” is exempt if the employee is customarily and regularly engaged away from the employer’s place of business and is employed for the primary purpose of making sales or obtaining orders or new customers. This exemption does not include sales made by phone, mail, or internet. The second category of minimum wage and overtime exemptions generally applies to employees in specific industries. They are exemptions for certain agricultural employees, amusement and recreational employees, casual babysitters, domestic companions, employees engaged in fishing operations, limited circulation newspaper employees, switchboard operators employed by small public telephone companies, seamen on non-American vessels, and federal criminal investigators. (ii) Overtime Only Exemptions The FLSA also exempts certain employees in specific industries from the overtime requirements. For example, the FLSA’s overtime requirement does not apply to employees with respect to whom the Secretary of Transportation has the power to establish qualifications and maximum hours pursuant to provisions of the Motor Carrier Act. The overtime requirements also do not apply to railroad or airline employees. For a description of other employees who are also exempt from the overtime requirements, please see 29 U.S.C. §§ 213(b)(5)-(30). A unique exemption applies to fire protection employees and law enforcement employees. Although these employees are entitled to overtime compensation, Congress has provided that a higher number of hours worked threshold be met over a period of time longer than a workweek before requiring that overtime compensation be paid. An employer can adopt a work period that is between 7 days and 28 days for these employees. Employers do not have to pay overtime unless the employee’s work in the work period exceeds the ratio of 212 hours to 28 days for fire protection employees and 171 hours to 28 days for law enforcement employees.88 Georgia Employment Law Handbook

Additionally, although non-exempt public employees are subject to the overtime requirements,their public employers are not required to pay non-exempt public employees one and half timestheir “regular rate” for each hour of overtime in cash or equivalent. Instead, public employers maycompensate non-exempt employees who have worked overtime with compensatory time at the rateof one and one-half hours of compensatory time for each hour of overtime actually worked. Publicemployers who intend to compensate employees who have worked overtime with compensatorytime must reach an agreement to that effect with the employee before overtime is worked.d. Recordkeeping RequirementsThe FLSA requires employers to “make, keep, and preserve” records of employees and of their“wages, hours, and other conditions and practices of employment.” The specific regulationsregarding recordkeeping are found in 29 C.F.R. § 516 and require employers to maintain certainrecords for both exempt and non-exempt employees. The extent of an employer’s obligation tomaintain records about its employees depends greatly on whether the employee is exempt from theminimum wage or overtime requirements. Employers must maintain the required records for at least3 years and must keep the records in the place of employment or at a central recordkeeping officewhere records are customarily maintained. The records must be available within 72 hours followinga request by the Department of Labor.4. Enforcement and DamagesThe FLSA provides for the following enforcement mechanisms: criminal proceedings, actions byindividual employees, collective actions by employees, and actions by the Department of Labor. Anindividual’s right to sue terminates when the Secretary of Labor commences an action. Civil actionsfor nonwillful violations of the FLSA must be commenced within two years of the violation. Thestatute of limitations for willful violations is three years.An employer who is convicted of committing a willful violation of the FLSA can be imprisoned forup to 6 months and fined up to $10,000. However, an employer cannot be imprisoned for a firstoffense. Additionally, the FLSA provides back pay, liquidated damages, civil penalties, attorneys’fees, and costs as damages for violations. 89

Chapter 27:Child Labor

A. Overview Eighteen is the age of majority in Georgia; anyone younger than eighteen is considered a minor. Chapter 2 of Title 39 of the Official Code of Georgia governs the employment of minors working within the state and generally applies to all employers. For the most part, Georgia’s child labor laws are less restrictive than federal child labor laws. Thus, conduct that is permitted in Georgia may be prohibited by federal law. Georgia employers who are covered by the federal Fair Labor Standards Act are responsible for ensuring that their actions comport with that statute as well. The minimum age for employment under Georgia law is 12, two years younger than the federal minimum employment age of 14. Georgia’s minimum age requirement does not apply to minors employed “in agriculture, domestic service, in private homes,” by their parents or “persons standing in the place of a parent,” or in “any specific employment permitted by” the Official Code of Georgia. Although employers are permitted to hire minors over the age of 12, the work conditions of these minors are highly regulated. It is a misdemeanor to violate any of Georgia’s child labor laws. An employer may be enjoined from employing a child in violation of these laws. It is also a misdemeanor for anyone to apprentice or otherwise dispose of a minor to any person for the purpose of using the minor as a rope/wire walker, beggar, “gymnast, contortionist, circus rider, acrobat, or clown, or for any indecent, obscene, or immoral exhibition, practice, or purpose.”B. Required Documentation An employer must receive an employment certificate prior to employing a minor. In order to receive an employment certificate, the prospective employer must provide a statement describing the capacity in which the minor will be employed and indicating that it would employ the minor immediately if the certificate were received. The minor must present this statement, along with a certified copy of his or her birth certificate or birth registration card, to the superintendent of schools, or an authorized staff member, if the minor is enrolled in public school, or to the principal administrative officer, or an authorized staff member, if the minor is enrolled in private school. The school will then issue an employment certificate. If the minor is between the ages of 12 and 16 the certificate must show the true age of the minor and “that such minor is not less than 12 years of age and is physically fit to engage in the employment sought to be obtained.” Where the minor is age 16 or older, the certificate must state that the minor “is fully 16 years of age.” The school must also issue an identification card to each minor age 16 or older certifying that the minor is eligible for employment. In addition to the certificate, the school must also issue a letter stating that the minor is enrolled full-time and has an attendance record in good standing. This letter must be updated “in January of each subsequent academic year during which the minor maintains his or her employment until such minor reaches the age of 18 years or receives a high school diploma, a general educational development (GED) diploma, a special education diploma, or a certificate of high school completion or has terminated his or her secondary education and is enrolled in a postsecondary school.” The employer must keep a copy of this letter as well as the employment certificate in the minor’s employment file. Failure to comply with the documentation requirements is a misdemeanor punishable by a fine up to $1,000 and/or up to 1 year imprisonment. 91

C. Permitted Employment No minor under 16 years of age is permitted to work at or in the vicinity of any mill, factory, laundry, manufacturing establishment, workshop, or other place of employment that the Commissioner of Labor may deem hazardous or “dangerous to life or limb or injurious to the health or morals” of a minor. Thus far, the Commissioner of Labor has deemed hazardous all occupations connected with (1) power driven machinery or equipment, (2) motor vehicles, whether being driven or serviced, such as at a gas station, (3) tools or equipment generally associated with the building and trades industry, (4) meat processing, including freezing or packaging meat, poultry, or seafood, (5) hazardous fixtures or merchandise such as guns, knives, or deep fat fryers, (6) railroads, (7) vessels or boats whether or not in use, (8) poisonous gases, acids, paints, or hazardous quantities of any other airborne substance, (9) construction or utilities, (10) warehouses, (11) excavating, (12) logging, (13) radioactive substances, and (14) demolition. Minors age 16 or older must have the proper employment certificate and identification card in order to work in these occupations. Please note that federal law prohibits minors under age 17 from working in many of these occupations. Notwithstanding the above designations, a minor may be employed to do office work for any such occupation provided that administrative policy forbids access to all hazards, whether or not listed by the Commissioner of Labor. In addition, during summer vacation, minors age 14 or older may be employed to perform lawn, shrubbery, or garden care and maintenance, including the operation of equipment associated therewith, as long as (1) the minor has proper documentation, (2) the lawns are owned or leased by the employer, and (3) “the minor is covered by an accident and sickness insurance plan or a workers’ compensation insurance policy or plan provided by the employer.” Such lawn work may be performed on the grounds of a factory or mill or other business, even though employment within the building would otherwise be prohibited. In Georgia, minors are generally prohibited from selling, serving, dispensing, or taking orders for alcoholic beverages. Nonetheless, they may be employed in establishments which sell alcohol for off-premises consumption, such as convenience stores or supermarkets.D. Work-Hour Restrictions 1. Ages 12 to 16 Minors under the age of 16 may not work during school hours, unless they have completed high school or have been excused from attendance by the county or the board of education of an independent school system. Furthermore, minors under the age of 16 generally may not work between the hours of 9:00 p.m. and 6:00 a.m. This time restriction also applies specifically to minors under the age of 16 “employed in the delivery of messages by any person, firm, or corporation engaged in the message service business or in the general work of messenger service.” However, minors employed to deliver and/or sell newspapers in residential areas may began their duties at 5:00 a.m., provided that such activities are not performed during school hours. Minors between the ages of 12 and 16 may not work more than 4 hours per school day during the months when school is in session. These minors may not work more than 8 hours a day on any day on which school is not in session. There is a total limit of 40 hours per week. 2. Age 16 or Older There are no hour restrictions for minors age 16 or older.92 Georgia Employment Law Handbook

E. Termination of Employment An employer must return the employment certificate to the minor’s school within 5 days of terminating a minor. Likewise, the employer must return the certificate if the minor has failed to report to work for a period of 30 days. The certificate must be returned within 5 days of the 30th day. Once an employment certificate has been returned, the employer must obtain a new certificate in order to re-employ the minor.F. Entertainment Industry Employment The child labor code does not apply to minors employed in the entertainment industry, provided that the employer has the written consent of the Commissioner of Labor. However, there are various provisions of the Rules and Regulations of Georgia that regulate minors in the entertainment industry, including rules addressing notification, the work environment, work hours, and the child’s education. 93

Chapter 28:Termination of Employees

A. Termination of an Employee Many of the laws discussed in these materials can impact the termination of an employee’s employment. In general, the employer should make sure that a termination is not prohibited by one of the discrimination or related statutes discussed above and is not contrary to an enforceable contract. The employer should make sure that the employee is not being terminated for engaging in a legally protected activity or for exercising a statutory right such as taking leave under the Family and Medical Leave Act. If enough employees are terminated at one time or within a relatively brief period of time, the employer may be required by law to provide advance notice of the terminations. Termination Pay and Final Paycheck - Georgia does not require that an employee receive his/her final paycheck on an expedited basis or that the employee receive any termination pay to which he/ she is not contractually entitled. Unless an employer has entered into a contract or adopted a policy calling for expedited issuance of a final paycheck, the employer should issue the final paycheck to a terminated employee no later than the payday on which that paycheck would ordinarily be due under the Georgia Wage Payment Statute (discussed in Chapter 9). Separation Notice - Georgia law requires an employer to furnish an employee who is being terminated with a separation notice at such time as the employee leaves the employment of the employer. The notice is to “contain detailed reasons for the employee’s separation.” The Georgia Department of Labor has adopted a Separation Notice form (Form DOL-800) for employers to provide to separating employees, which is available at http://www.dol.state.ga.us/pdf/forms/ dol800.pdf. It is a misdemeanor to knowingly make false statements on this form. In appropriate circumstances, partial (DOL-408) or mass separation (DOL-402) notices may be used. Form DOL- 402 is available at http://www.dol.state.ga.us/pdf/forms/dol402.pdf. An employer should use care in completing these forms, both to comply with the requirement of responding truthfully and to avoid making statements that would be unnecessarily harmful in possible future discharge litigation. COBRA - The federal COBRA notice must be provided to eligible terminated employees following an applicable termination or other qualifying event. (See COBRA discussion in Chapter 24). Georgia does not have any additional requirements. Unemployment Benefits - See discussion in the Unemployment Benefits section of these materials (Chapter 13). Severance Agreement - Principles of contract and release of claims generally apply to severance agreements in Georgia. The Older Workers Benefit Protection Act should be consulted regarding releases of age discrimination claims. 95

B. Plant Closings and Mass Layoffs Unlike some states, Georgia does not have special legislation governing plant closings and mass layoffs. The Georgia Department of Labor does require submission of a Mass Separation Notice (DOL-402) when 25 or more employees separate on the same day for the same reason. Form DOL- 402 is available at http://www.dol.state.ga.us/pdf/forms/dol402.pdf. Because Georgia has no general plant closing or mass layoff law, the employer needs to look principally to the federal Worker Adjustment and Retraining Notification Act (“WARN”) in plant closing or mass layoff situations. The federal WARN Act applies to “any business enterprise” employing 100 or more employees, excluding employees who have worked less than six months and those who work an average of less than twenty hours per week. The Act requires an employer to give employees who are reasonably expected to suffer employment loss 60 days’ notice of any (1) plant closing that affects 50 or more workers in a 30-day period or (2) mass layoff at a single site during any 30-day period (i) resulting in a job loss for 50 to 499 employees if this number comprises at least 33% of non-part- time employees, or (ii) resulting in a job loss for at least 500 non-part-time employees. Employees who suffer an employment loss have a private right of action in federal court for WARN violations. In addition to notifying affected employees, employers must provide notification of the mass layoff or plant closing to state and local authorities. If the employees who are expected to experience an employment loss in a plant closing or mass layoff are represented by a union, the employer must notify the union instead of the represented employees. Of course, the same discrimination and related statutes that govern other terminations and layoffs must also be complied with in a group layoff situation. If severance agreements and releases are sought in connection with a group termination, the group termination provisions of the federal Older Workers Benefit Protection Act need to be complied with to maximize the enforceability of the releases obtained.96 Georgia Employment Law Handbook

Index