Lawyers as Employers: A Guide to SC Employment Law for Small Firms and Solo Practitioners

TABLE OF CONTENTS

Chapter 1: Wages, Hours And Overtime...... 1 I. Introduction...... 1 II. Federal Law – The Fair Labor Standards Act...... 1 A. Defi nition of Employee...... 2 B. Defi nition of Employer...... 2 C. Defi nition of Commerce and Production For Commerce...... 3 D. Geographical Restrictions...... 3 III. Wage and Hour Lawsuits – Claims and Settlements on the Rise...... 4 A. The Rise in Wage and Hour Lawsuits...... 4 B. Wage and Hour Statistics – 2009-2010...... 5 IV. Payment of Wages...... 5 A. The Equal Pay Act...... 5 B. Ledbetter Fair Pay Act...... 6 C. Recording Hours Worked...... 7 D. Minimum Wage Under The FLSA...... 8 E. The Workweek...... 8 F. South Carolina’s Payment of Wages Act, S.C. Code § 41-10-10...... 9 G. Bonuses Under South Carolina’s Wage Payment Act...... 10 H. Time of Payment...... 11 I. Recordkeeping...... 12 V. Determination of Hours Worked...... 13 A. Voluntary or Unauthorized Work...... 14 B. Waiting Time...... 14 C. On-Call Time...... 15 D. Working at Home...... 16 E. Travel Time...... 17

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F. Training, Lectures and Meetings...... 18 G. Rest/Break and Meal Periods...... 19 H. Activities Before and After Scheduled Hours...... 20 VI. Exemptions From Overtime...... 21 A. White Collar Exemptions...... 21 B. Executive Employees...... 27 C. Administrative Employees...... 28 D. Professional Employees...... 30 E. Paralegals...... 33 F. Law Clerks...... 33 G. Runners/Couriers...... 33 H. Highly Compensated Employees...... 34 I. Skilled Computer Employees...... 34 VII. Calculation of Overtime...... 42 VIII. Determining the Workweek...... 44 IX. Excluding the Statutory Exceptions From Earnings...... 45 X. Calculating the Regular Rate of Pay...... 48 A. Regular Rate of Pay for Salaried Employees...... 48 B. Regular Rate of Pay for Fixed Salary for Fluctuating Hours...... 49 XI. Regular Rate of Pay for Bonuses...... 51 XII. Benefi ts...... 52 A. Employee Welfare Benefi ts...... 53 B. Vacations...... 53 C. Holidays...... 54 D. Sick Pay...... 55 E. Paid Time Off Policy...... 55 F. Jury Duty...... 56 XIII. Availability of Wage and Hour Records...... 56 XIV. Enforcing the FLSA...... 56 A. Regulations and Bulletins...... 57 B. Investigative Powers...... 57 C. The Investigative Process...... 58 D. Civil Actions to Enforce the FLSA...... 59 E. Administrative Complaints to Enforce the FLSA...... 60

F. Remedies Available Under the FLSA...... 60 ii Table of Contents

G. Criminal Actions to Enforce the FLSA...... 62

Chapter 2: Use of Independent Contractors ...... 63 I. Introduction...... 63 II. Establishing the Proper Relationship...... 63 A. The Economic Realities Test...... 64 B. The Control Test...... 65 C. 20-Factor Test...... 67 III. Summary – Independent Contractor Rules to Live By...... 73 IV. Recommendations...... 75 V. Independent Contractors in the Law Firm Setting...... 77

Chapter 3: Garnishments...... 79 I. Federal Garnishment Laws...... 79 A. The Consumer Protection Act...... 79

Chapter 4: Employee Handbooks...... 83 I. Introduction...... 83 II. South Carolina Handbook Law Prior to June 30, 2004...... 84 III. South Carolina’s Conspicuous Disclaimer Statute...... 86 IV. The Law Firm Setting and Topics to Consider Including in A Handbook...... 88

Chapter 5: Drug Testing in The Workplace...... 95 I. Introduction...... 95 II. Substance Abuse Testing – Federal Laws...... 96 A. Americans With Disabilities Act (ADA)...... 96 B. Title VII of the Civil Rights Act of 1964...... 97 III. Substance Abuse Testing – State Laws...... 98 A. South Carolina Statutory Law...... 98 B. Potential Common Law Challenges to Drug Testing...... 99 IV. Practical Considerations...... 102 V. Conclusion...... 104

Chapter 6: Unemployment Claims in South Carolina ...... 105 I. Introduction...... 105 II. Unemployment Benefi t Basics...... 105 A. What is Unemployment Compensation?...... 105 B. Calculating Benefi ts...... 106

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C. Employer Contribution Obligations...... 106 D. Employee Eligibility...... 107 E. Employer-Filed Claims...... 108 F. Payment of Benefi ts Upon Death...... 109 G. Benefi t Disqualifi cation...... 109 III. Disputing a Claim for Benefi ts...... 114 A. Initial Determination...... 114

B. Evidentiary Appeal to Administrative Hearing Offi cer...... 115 C. Appeals to the Appellate Panel...... 116 D. Court Review...... 116

Chapter 7: Illegal Employment Discrimination ...... 119 I. Introduction...... 119 II. Title VII of the Civil Rights Act of 1964...... 119 A. Sex Discrimination...... 120 B. Pregnancy Discrimination...... 120 C. Race Discrimination...... 121 D. Religious Discrimination...... 122 E. National Origin Discrimination...... 123 III. Age Discrimination in Employment Act...... 123 IV. Older Workers Benefi t Protection Act...... 124 V. Equal Pay Act...... 124

VI. Genetic Information Discrimination (GINA)...... 125 VII. The Civil Rights Act of 1866 (Section 1981)...... 126 VIII. South Carolina Human Affairs Law...... 126 IX. Retaliation...... 127 X. Proof of Discrimination...... 127 A. Individual Disparate Treatment...... 127 B. Systemic Disparate Treatment...... 129 C. Disparate Impact...... 129 XI. Conclusion...... 130

Chapter 8: Workplace Harassment...... 131

I. Workplace Harassment: It’s Not Just About Sex...... 131 II. Two Types of Harassment...... 131 A. Tangible Employment Action Harassment...... 132 B. Hostile Work Environment Harassment...... 133 iv Table of Contents

C. An Employer’s Affi rmative Defenses to Hostile Work Environment Harassment...... 136 III. Recognizing the Existence of Workplace Harassment...... 138 A. Physical...... 138 B. Visual...... 139 C. Verbal...... 139 IV. Recent Trends in the Area of Harassment...... 140 A. Implementation of Training Requirements...... 140 B. Harassment and the Internet...... 141 V. Who is Conducting the Harassment?...... 141 A. Supervisors...... 141 B. Co-workers...... 142 C. Non-Employees...... 143 D. Same Sex Harassment...... 144 E. Female Harassment...... 144 VI. Employer’s Duty of Reasonable Care...... 144

Chapter 9: Disability Discrimination ...... 149 I. The Americans with Disabilities Act (ADA) - Introduction...... 149 II. Basic Defi nitions and Coverage...... 150 A. Employer Coverage...... 150 B. “Disability”...... 150 C. Qualifi ed Individual with a Disability...... 154 III. Discrimination Under the ADA...... 157 IV. Reasonable Accommodation Under the ADA...... 158 V. Additional Requirements and Employer Concerns...... 162 A. Pre-Employment Inquiries and Medical Testing...... 162 B. Alcoholism and Drug Use Under the ADA...... 164 C. The “Direct Threat” Defense...... 165 D. Remedies and Enforcement...... 166 VI. Concluding Thoughts and Compliance Tips For Legal Employers....166

Chapter 10: Posting and Record-Keeping Requirements...... 171 I. Posting Requirements...... 171 A. Selected Posting Requirements Under Federal Law...... 171 B. Selected Posting Requirements Under South Carolina Law...... 174

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II. Record-Keeping Requirements...... 176 A. Selected Federal Record-Keeping Requirements...... 177 B. Selected South Carolina Posting Requirements...... 182 III. Employee Access to Records...... 184

Chapter 11: South Carolina Workers’ Compensation Law...... 185 I. South Carolina Workers’ Compensation...... 185 A. Purpose...... 185 B. The South Carolina Workers’ Compensation Commission...... 185 C. Coverage...... 186 D. Exclusive Remedy...... 186 II. General Defenses...... 187 A. Employer/Employee Relationship...... 187 B. Injury by Accident...... 187 C. Going to and Coming from Work...... 188 D. Recreational and Social Events...... 188

III. Affi rmative Defenses...... 188 A. Notice...... 189 B. Statute of Limitations...... 189 C. Fraud in the Application for Employment...... 189 D. Intoxication...... 190 IV. Benefi ts – Wage Replacement, Medical Care and Permanent Disability...... 190 A. Date of Accident...... 190 B. Average Weekly Wage...... 190 C. Compensation Rate...... 190 D. Maximum Medical Improvement or “MMI”...... 191 E. Temporary Disability Benefi ts...... 191 F. Permanent Disability Benefi ts...... 191 G. Permanent Total Disability Benefi ts...... 191 H. Medical Benefi ts...... 191 I. Other Benefi ts...... 192 V. Claims Handling...... 192 VI. Settlement of Claim...... 192 VII. Formal Hearings...... 193 VIII. Appeals Procedure...... 193 vi Table of Contents

IX. Third-Party Claims...... 193

Chapter 12: Federal and South Carolina Immigration Requirements ...... 195 I. Overview of Federal and State Immigration Requirements...... 195 A. Obligation to Verify Work Authorization of All Employees...... 195 B. Work Authorization...... 196 II. Federal Work Authorization Verifi cation...... 196

A. Form I-9...... 196 B. I-9 Discrimination, Document Abuse, and Retaliation...... 199 C. Employer Sanctions...... 200 D. E-Verify Program...... 201 III. South Carolina Illegal Immigration Reform Act (SCIIRA)...... 202 A. Pre-Amendment Compliance with SCIIRA (January 1, 2009 - December 31, 2011)...... 202 B. Post-Amendment Compliance with SCIIRA (on or after January 1, 2012)...... 203 C. SCIIRA Tax Credit Provisions...... 205 IV. Obtaining Work Authorization...... 205 A. Nonimmigrant Work Status vs. Legal Permanent Residence...... 205 B. Special Considerations for Law Firms...... 206 V. Conclusion...... 209

Chapter 13: Employment Torts...... 211 I. Introduction...... 211 II. Defamation...... 211 A. Elements...... 212 B. Defenses...... 214 C. Defamation and Law Firms...... 216 III. Intentional Infl iction of Emotional Distress...... 217

A. Four-Part Test to Establish IIED...... 217 B. Intentional Infl iction of Emotional Distress in the Employment Context...... 217 C. IIED and Law Firms...... 219 IV. Invasion of Privacy...... 219 A. Wrongful Intrusion into Private Affairs...... 219 B. Wrongfully Publicizing Private Affairs...... 221 C. Invasion of Privacy and Law Firms...... 224

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V. Wrongful Discharge in Violation of Public Policy...... 224 A. South Carolina Law...... 224 B. Law Firms and Wrongful Discharge in Violation of Public Policy...... 226 VI. Other Workplace Torts...... 227 A. Assault and Battery...... 227 B. Civil Conspiracy...... 228

Chapter 14: Miscellaneous South Carolina Employment Laws ...... 229 I. Use of Tobacco Products...... 229 II. Protection from Jury Service/Subpoena Compliance...... 229 III. Paid Leave for Bone Marrow Donors...... 229 IV. Blue Laws...... 230

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