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Fri Dec. 6th, 2013 PTWWW Legal Alert

Food Allergies as Disabilities?

The Department of Justice recently filed claims against Lesley University for violation of the Americans with Disabilities Act (ADA).  Despite enforcing a mandatory meal plan for all residents, the University failed to consider modifications for students with allergies that would allow them to take advantage of the program.  For some, the intake of gluten, dairy, and nut products can significantly limit major bodily functions, which qualifies as a major life activity requiring accommodation under the ADA.

The case was settled with the University agreeing to pay the students and establish a policy to provide gluten-free and allergen-free dining options.  The University was also required to display notices concerning food allergies, and identify foods containing certain allergens.

While the circumstances of the Lesley case can be distinguished from a restaurant, there are implications for any business that provides food to its employees or the public.  Many employers across America provide meals to workers as part of compensation or benefits.  Restaurants, for example, often sustain their employee’s appetite with meals at the beginning of each shift.

While it may be alarming that food allergies are now included as “disabilities,” if these dietary restrictions are ignored, serious illness can occur.  Employers should, at minimum, be sensitive to the possibility of engaging in an interactive process with any employee who requests a workplace accommodation in connection with a food allergy.

Health Care and Income

If a company uses a payroll processor to determine that an employee’s health care costs are under the 9.5% of total income cutoff and this proves to be inaccurate, who is liable for the penalty fees?

The National Restaurant Association mentions that in most cases, a contract with a payroll company should allow reimbursement, though the ultimate responsibility for the fees will fall on the restaurant operator.

A general rule of thumb should be to deal in good faith and attempt to make coverage affordable.  Employers are not required to charge the 9.5% of the salary cutoff, and in many cases affordable coverage can still be provided without approaching this limit.  It is advisable to assess the lowest-paid full-time position the company has, and use that employee as a benchmark for how coverage is set.

The National Restaurant Association suggests that a solidly worded contract with any payroll processor is best.  If fees are imposed, the government will initially collect the money from the restaurant operation, leaving the company with the responsibility of collecting reimbursement later.

Creating an Effective Workplace Social Media Policy

A new body of law is growing to address the increasing pervasion of social media at the workplace.  Employers must now balance their business needs against employees’ freedom to engage in personal pursuits.  Therefore, it is critical that employers develop and implement an effective social media policy that considers both their interests and the rights of their employees.

Employers must keep in mind that certain online employee activity is legally protected.  Over the past two years, The National Labor Relations Board has issued decisions and guidelines regarding the nature of protected employee speech under the National Labor Relations Act (NLRA).  Under this line of authority, employees may lawfully discuss “concerted activity” through personal social media accounts.  Online discussions relating to wages or working conditions, for example, are protected under the NLRA, because employees bear the right to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection.

A number of state legislatures, including California, have passed bills that, in some form, prohibit an employer from requesting or requiring that an employee or applicant disclose any user name, password, or other means for accessing a personal account or service through specified electronic communication devices.  Many of these states also prohibit an employer from forcing employees or applicants to log in to their accounts in the presence of the employer.

The fundamental issue is that employers must be aware of the evolving body of federal and state law on social media when constructing a policy.

Tip Reporting 101

Complying with IRS tip reporting rules is one of the most critical and important tasks facing restaurant owners.  Restaurant employees are required to report and pay taxes on all their wages, including tips.  Since most tipped employees receive a majority of their income in the form of “cash” tips, it is not surprising that they are reluctant to fully report this income.

It is a business owner’s responsibility to ensure that employees are reporting all of their tips.  While the IRS only requires tip reports to be provided on a monthly basis, a tip report for each employee at the end of each pay period must be prepared in order to accurately report total wages, make proper deductions, and pay state taxes.

Restaurant owners are legally allowed to report at least eight percent of a tipped employee’s gross receipts as tips on their behalf.  Though traditionally it is customary to tip restaurant servers between fifteen and twenty percent of a guest’s check, the IRS has determined that eight percent is a fair estimate.  Generally, restaurant owners who rely on tipped employees to claim all cash tips using an IRS form 4137 are responsible for deducting at least eight percent of the employee’s sales pay each period.  If not, the owner is responsible for paying the difference himself/herself.