Urban Legends of Employment Law II

Lisa Bogany As I mentioned in the previous blog, there are several misconceptions about Texas employment law that are held by both employers and workers. I have found that many of these “Urban Legends” come from employers and employees who have previously done business or worked in other states.

The Legend: All employees who work 40 hours per week are full-time employees.

The Facts: The question of whether an employee is full-time or part-time usually comes up in the context of perks and benefits, i.e., a company’s policy provides benefits such as sick leave or vacation pay to full-time, but not part-time, employees. However, no Texas or federal law provides a definition of full-time for this purpose. Therefore, it is up to the employer to determine the eligibility criteria for receiving these benefits. Obviously, employers do not want to base benefits on inappropriate criteria, such as race, religion, or national origin, but otherwise they have considerable discretion. For example, some employers give additional benefits based on an employee’s length of service or job classification. Others negotiate benefit packages with employees on an individual basis.

Retirement and pension plans are an exception to this general rule. Under the Employee Retirement Income Security Act (ERISA), companies are not required to have a retirement or pension plan. However, if a company does have such a plan, it must offer any employee who works 1,000 or more hours in the preceding 12-month period an opportunity to participate in that plan.

The Legend: Placing an employee on a salary basis makes them exempt from the overtime laws.

The Facts: While being paid a salary is a major part of determining whether someone is exempt from the overtime laws, it is not the whole test by itself. Many salaried employees are still entitled to overtime. In order to avoid paying overtime to most employees, the employer has to show that the employee is not only paid a salary of at least $455 per week, but also that the employee’s duties are those of a professional, executive, or administrator.

The Legend: Employees have a right to see their personnel files.

The Facts: For private sector employers, personnel files are company property, and they are kept and maintained for the sole use of the company. Therefore, the company has the right and responsibility to control access to those files. Some companies have a strict prohibition against allowing employees access to view personnel records. Other companies will allow employees to view their own files, but only under controlled conditions, and only after management has reviewed the file first to make sure that it contains no inappropriate documents. No prudent company would allow all employees unfettered access to all personnel files. Of course, all company files are potentially subject to disclosure through a lawsuit or subpoena. Additionally, even if a public sector employer has a policy against disclosure, employees may be able to gain access to their files through the Texas Public Information Act.

I hope addressing some of these employment “Urban Legends” has been beneficial. There are many more out there. If you have a particular legend you want clarity on, “let’s talk.” That can be one of the benefits of using this electronic medium.

Lisa Bogany is a Senior Business Consultant for Workforce Solutions in the Houston metropolitan area. She has over five years of experience in workforce development, primarily working with employers, and over 10 years experience in small business entrepreneurship.



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