What can you do if a competitor lies in its ads?

Your competitor’s advertising makes false claims about how great its products are – or worse yet, disparages your own products. What are your options?

You have a range of alternatives, from complaining to a private or government agency to filing a lawsuit. Here’s a look at some of the choices.

If your competitor is saying things it shouldn’t, the simplest approach is to complain to the Better Business Bureau’s National Advertising Division, or NAD. The NAD has been around since 1971 and has adjudicated some 5,000 disputes over whether advertising was fair and accurate. [Read more…]

Amazon sued for directing people to competing products

A company called Multi Time Machine makes high-end military-style watches. It refuses to sell them on Amazon. If you search for the company’s watches on Amazon, you’ll get a long list of competing watches.

Is this illegal?

Possibly, according to a federal appeals court in San Francisco, which allowed a lawsuit against Amazon. [Read more…]

Businesses may be in more trouble for data breaches

Two years ago, retailer Neiman Marcus suffered a data breach that resulted in some 350,000 customers having their credit card information compromised. About 9,200 of those customers ended up with fraudulent credit card charges.

That’s bad enough – but Neiman Marcus was then sued in a class action by customers who didn’t have any fraudulent charges on their cards. These customers said Neiman Marcus should nevertheless compensate them for the time and money they had spent on credit monitoring and other efforts to prevent fraud as a result of the hack.

Even though the actual harm to these people might be fairly small, the fact that there were hundreds of thousands of them meant that the size of potential lawsuit was very significant. [Read more…]

‘Comparative advertising’ was close to the line but okay

The Schick razor company recently complained to the National Advertising Division (an ad industry regulatory body administered by the Better Business Bureau) about ads created by the Dollar Shave Club. Schick believed the ads accused name-brand razor companies of engaging in price-gouging and ripping off customers by charging extra for useless features.

One Shave Club ad showed a razor customer at a drugstore receiving a “free gift” of a kick in the groin along with his name-brand razor purchase. Another showed a customer handing over all his worldly possessions to buy razors. [Read more…]

Supreme Court gay marriage ruling affects employee benefits

The U.S. Supreme Court’s recent decision extending same-sex marriage to every state will have a big effect on many employee benefit programs.

Prior to the ruling, most states (and the federal government) recognized same-sex marriage. If all of your employees live in states that previously recognized gay marriages, then no changes are required. But if any of your employees live in previously “non-marriage” states, then the ruling will make a difference.

If some of your workers live in “non-marriage” states and you previously offered benefits to same-sex spouses, then for any employees in those states who have a same-sex spouse, you’ll need to adjust their state tax withholding to the “married” rate, and you may need to adjust their withholding to reflect the fact that spousal health benefits will no longer be subject to state tax. [Read more…]

Social media: New issues for business

Social media is a relatively new field, and the law is just beginning to catch up with all the issues that are being raised for businesses.

Here’s a quick checklist of concerns. It’s by no means exhaustive, which is why a thorough legal review of a company’s social media practices is always a good idea.

Do you look at employees’ (or job applicants’) personal social media accounts? These days, many employers want to keep tabs on their workers’ social media presence. Employers want to get out ahead of problems, such as employees bad-mouthing the company on Twitter or posting confidential information on Facebook. [Read more…]

Buyout provisions can have unexpected consequences

Many businesses have a buyout agreement that says that if one owner retires or resigns, the others can buy out his or her interest at a certain price.

These agreements are a smart idea for retaining control of a company. But you should keep in mind that they can sometimes be used in ways you wouldn’t expect. [Read more…]

Know the tax rules for gifts to employees and customers

If you provide bonuses, awards, gifts or prizes to employees or customers, it’s important to understand the tax consequences. It’s particularly important if the recipient is going to have to pay a tax – you’ll want them to understand this fact from the start, so they don’t get an unpleasant surprise later.

In general, any gifts made by a company to an employee are considered wages. They’re subject to both employment tax and income tax, and must be reported on an employee’s W-2 form. [Read more…]

Company gets sued for mentioning a celebrity in its advertising

The Duluth Trading Company was looking for a way to promote its men’s Henley-style collarless polo shirts. It thought of Don Henley, the lead singer of the Eagles, whose first big hit in 1974 was called “Take It Easy.” So it created an ad that said, “Don a Henley and take it easy.”

Result: The company got sued – by Don Henley. [Read more…]

What businesses need to know about commercial leasing

Companies that are leasing their own space for the first time are often surprised by the terms of a commercial lease – and even companies that have leased space before sometimes overlook important points where they might be able to negotiate matters to their advantage. Here’s a quick guide to what to look for: [Read more…]

New rules make it easier for unions to organize workers

The National Labor Relations Board has adopted new, “streamlined” rules for union elections that create additional requirements for businesses and could dramatically shorten the time between when a union files a notice and when a vote is held.

Union elections could now be held as little as 13 days after a union files a petition. This means companies will have to scramble to meet very short deadlines, and may have little or no time to respond and make their case to their workers about why they don’t need a union. [Read more…]

Poor expense records cost business owner $27,000

Owners of smaller businesses can sometimes be careless about keeping records of business expenses for tax purposes.

The good news is that there’s no one right way to keep these records. According to the IRS, you can use any method of tracking expenses you like if it works for you and your business.

However, whatever method you use, you still have to be able to substantiate the time, place, amount, and business purpose of each expense, plus the business relationship of any person you entertained.

Recently the U.S. Tax Court criticized a small businessman for poor tax records and refused to allow him to deduct $27,759 in expenses. [Read more…]

How to keep out competitors if you lease retail space

Most stores that lease space in a mall or other commercial area would like a guarantee that the landlord won’t also rent to a competing business.

This guarantee is known as “exclusive use,” and you can negotiate for it in a lease. If you’re negotiating a right to exclusive use, here are some things to consider:

What’s the use? You’ll want to specifically define your “use,” and what kinds of other businesses are allowed. For instance, if you have an ice-cream-cone shop and you also sell a few ice-cream cakes, can the landlord still rent to a bakery? If a coffee retailer has “exclusive use,” does that mean a sandwich shop can’t also sell coffee? [Read more…]

Are your LinkedIn contacts a trade secret?

If salespeople connect with their business contacts on LinkedIn or another social media site, can they take that information with them when they leave the company?

Maybe not, according to a federal court in California.

David Oakes worked for six years as a salesman for a cell phone accessories company. He had signed an agreement saying that he wouldn’t disclose any proprietary information, including the company’s customer base. When the company terminated him, he started a competing business. His old company then sued, claiming, among other things, that he had maintained his LinkedIn contact list after he was terminated. [Read more…]

Government is suing businesses over wellness programs

The federal government has filed two lawsuits against companies that set up “wellness programs” for their employees. According to the government, wellness programs are perfectly fine if they’re voluntary – but these two companies’ programs weren’t really “voluntary” because workers were penalized if they didn’t participate.

Many employers have started wellness programs recently as a way to reduce health insurance costs. The programs are now used by about 94% of businesses with more than 200 workers.

But wellness programs can be tricky, because they often require workers to divulge sensitive information, including disabilities and family medical history. This can conflict with federal laws against discrimination based on disabilities and genetics, and can raise other problems because certain health issues occur disproportionately on the basis of age, sex and race. [Read more…]

Company sued for copying ‘look’ of competitor’s website

If you’ve put a lot of time and money into designing a distinctive website or online store, and a competitor comes along and copies your site’s look, can you sue?

Yes, according to a federal court in California. The “look and feel” of a website is protected by the trademark laws.

Surprisingly, this is one of the first court rulings ever on this question.

Of course, a website is different from a trademark. But a website can still be protected by the law, because it can amount to a company’s “trade dress.” [Read more…]

Wage garnishments are skyrocketing – and they’re a minefield for businesses

More than 10 percent of employees between the ages of 35 and 44 had their wages garnished last year, according to a new study by payroll company ADP. That’s a staggering figure, and it creates a serious problem for employers, who are subject to complex state and federal laws about garnishment and can be sued if they do something wrong.

For years, wage garnishment was generally limited to people who fell behind on child support payments or owed money to the IRS. But that’s changed, as more and more private companies are using wage garnishment as a way to collect overdue consumer debts.

In the past few years, these creditors have filed millions of lawsuits. Last year, some 4 million people had their wages garnished for credit card debts, student loans, car payments, medical bills and other consumer obligations. In fact, among employees earning $25,000 to $40,000 a year, more had garnishments for consumer debts than for child support. [Read more…]

Companies can’t prohibit workers from discussing their salaries

A company can’t prohibit its workers from disclosing and discussing their salaries, according to a federal appeals court in New Orleans.

That’s because federal labor law says that employees always have a right to talk about the terms and conditions of their employment. And that’s true regardless of whether the employees belong to a union.

The case involved a non-union trucking company in Fort Worth, Texas that made its workers sign a confidentiality agreement. The agreement said that workers could not reveal any “financial information” or “personnel information” to anyone outside the company. [Read more…]

‘Puffery’ on product label was okay, court says

A manufacturer isn’t allowed to make false or misleading statements in its advertising or on a product label. But in a recent case involving the Gerber baby food company, a California court ruled that claims made on its labels, while vague and open to interpretation, were not over the line.

Gerber said on some of its labels that its products were “an excellent source” of various vitamins and minerals, that they provided “natural immune support” and helped create “healthy growth and development,” and that they contained “no added sugar.” [Read more…]

Is a ‘letter of intent’ binding?

Businesspeople who have agreed on the general terms of a deal often sign a “letter of intent” that lays out these terms in writing. The idea is to make sure that everyone is on the same page while a formal contract is being drafted.

But what happens if you sign a letter of intent with someone, and then they walk away from the deal? Is that okay?

In general, the answer is yes – a letter of intent isn’t a binding contract; it’s merely an expression of a plan to negotiate a binding contract. [Read more…]

Beware of ‘off-the-shelf’ forms for background checks

A company can conduct background checks on job applicants, but there are strict federal laws governing how to go about getting applicants’ permission to do so.

Increasingly, businesses are using “off-the-shelf” forms for this purpose, or are contracting with third-party vendors to set up an online job application process.

The problem is that if the forms or the online services don’t comply with the letter of the law, the company itself may be on the hook.

This happened recently to the Whole Foods supermarket chain, which contracted with a vendor to set up an online application system. [Read more…]

Businesses sued for disclosures of health care information

The federal law called HIPAA requires anyone who has access to medical information to keep it confidential. Businesses that violate the law can face penalties from the government. A big new threat, though, is that recently some courts have also started allowing people whose information was improperly disclosed to sue for damages in court.

This is significant, because the HIPAA law applies not only to doctors and hospitals but also to businesses that have even occasional access to medical data. This includes dentists, pharmacies, chiropractors, rehab facilities, insurers, data processing companies, transcriptionists, accountants and consultants who work with medical clients, and others. [Read more…]

Does your insurance cover a data breach?

Given the rapid increase in data breaches – affecting not only Fortune 500 companies but smaller businesses as well – it’s worth checking whether your current insurance policy covers cyber losses.

That’s especially true now that almost every state requires companies to notify customers if their data has been compromised.

A growing number of insurers are now offering cyber-liability policies. These typically cover the costs of investigating a data breach and notifying customers, loss of business and reputation, and future credit monitoring.

A recent study by the Ponemon Institute found that businesses with fewer than 10,000 customer records are more likely to be hacked than businesses with over 100,000 records, in part because they’re less likely to have robust defenses against hackers. [Read more…]

You may need a policy covering employees’ use of cloud storage

Employees are discovering that cloud storage services are a great way to access work-related data at home and on the road, and to collaborate with co-workers, especially those who work remotely.

Unfortunately, they’re also a great way to make your confidential data insecure – which is why you may need a thoughtful policy covering their use.

Cloud services allow a user to log into an account, upload documents or files, and then access or download them from any device, anywhere and at any time. Users can sync folders across devices, and can also share or sync files with others. [Read more…]

‘Crowdfunding’ businesses have obligations to investors

More and more start-up businesses are seeking funding on websites such as Kickstarter or Indiegogo, promising small rewards to individual investors in return for micro-contributions.

These include the Veronica Mars movie, which raised millions of dollars by promising small contributors posters, DVDs and movie scripts, and a space telescope project that offered “space selfies.”

But keep in mind that these promises are a legal obligation – so if you end up getting hundreds or even thousands of contributors by offering small rewards, you’ll have to follow through on each one of them. [Read more…]

Companies can’t force workers to accept ‘payroll cards’

Companies cannot require workers to receive payment of their wages via “payroll cards,” according to the federal Consumer Financial Protection Bureau.

Payroll cards have become popular recently, especially in the retail and food service industries. But under federal law, a company can’t make the cards the exclusive way it offers to pay wages.

State laws may impose further restrictions on the cards. [Read more…]

You can be sued for interfering with someone else’s contract

If you sign a licensing agreement to sell someone else’s products, but that person already has an exclusive license with a third party to sell the same products, you could be legally on the hook.

That’s a lesson that J.C. Penney learned the hard way, after it signed an agreement with Martha Stewart to sell a variety of her housewares in special dedicated sections of its stores.

The problem was that Martha Stewart had previously signed an exclusive licensing agreement with Macy’s covering sales of her kitchen, bed and bath products. So while J.C. Penney could legally sell other Martha products such as window treatments, rugs and lighting, sales of the kitchen and bath products violated the agreement. [Read more…]

Company not liable for employee who assaulted customer

A car dealership couldn’t be held liable in court for a salesman who sexually assaulted a customer, according to the Texas Court of Appeals.

The customer had brought her car in for service and was waiting for a shuttle bus to take her home. The salesman offered to drive her home in his personal car, and she claimed that along the way, he made improper advances. The dealership immediately fired the salesman.

The customer sued the dealership, but the court said the dealership had done nothing wrong.

The dealership hadn’t been negligent in hiring the salesman, it said, because it wasn’t aware of any indication that he might do something like this. Although there was some suggestion that he might have engaged in misconduct in the past, there was no evidence that he had ever engaged in sexual misconduct. [Read more…]

If someone falls outside your business, are you liable?

If you lease a store or other business and someone trips and falls outside the building, are you legally responsible?

That often depends on what’s in your lease – so this is something you may want to think carefully about when you negotiate.

This issue came up recently when a woman named Sabena Beriy fell on what she claimed was a poorly maintained curb outside a P.F. Chang’s China Bistro restaurant. P.F. Chang’s had leased the property from a landlord as part of a larger development. The lease said that P.F. Chang’s was responsible for any injuries on its “premises,” and that the landlord was responsible for any injuries that occurred outside of those premises.

P.F. Chang’s claimed that Sabena’s fall occurred in the common area of the development, not in its restaurant. It also claimed that the landlord was responsible under the lease for designing and maintaining the parking areas, driveways and curbs. [Read more…]

Supreme Court: No patent for doing ordinary things online

You can’t obtain a patent for taking some ordinary process in the real world and coming up with a computer program that makes it easier, according to the U.S. Supreme Court.

The decision is important because many companies have been trying to patent their apps and other programs to keep competitors from taking their business away.

In the Supreme Court case, a company called the Alice Corporation tried to patent an online system to reduce risk in financial transactions. Alice’s program was little different from a third-party clearinghouse or escrow service, except that it all happened automatically online. [Read more…]

Social media marketing can create legal traps for businesses

If you’re using social media to market your business, that’s terrific – but you should be aware that the same legal rules that apply in the “real world” also apply to Twitter, Facebook, Pinterest and other venues.

Many companies have rushed into social media marketing plans without considering the legal issues. Here’s a quick look at some of the problems that can result:

Improper endorsements. Many social media campaigns solicit endorsements, testimonials and favorable reviews from consumers, and then promote them. That’s fine – but keep in mind that if you offer anything in return for such endorsements, you may have to disclose this fact. [Read more…]

New rules for telemarketing calls and text messages

The Federal Communications Commission has adopted new rules that strictly limit telemarketing calls and text messages.

Businesses can no longer make pre-recorded calls to landline phones, and can no longer send pre-recorded calls, auto-dialed calls, or text messages to cell phones. The only exception is if the business has the “prior express written consent” of the customer.

This prior written consent must be very clear, and the customer must be told that providing a phone number is not a condition of making a purchase. The customer must actually provide the number; it can’t be “pre-populated” on a form.

Pre-recorded calls are now illegal without written consent even if the company already has an established business relationship with the customer. [Read more…]

Be careful if contracting work is ordered by a tenant

Businesses that perform contracting work at a property are generally entitled to a “lien” against the property to make sure they get paid. This means that if the property owner fails to pay, the contractor can in some circumstances foreclose on the property, have it sold, and collect payment from the sale proceeds.

These types of liens can benefit building contractors, laborers, carpenters, plumbers, electricians, architects, engineers, and suppliers of materials (such as lumber yards). Sometimes liens also apply to cars and trucks, and can be claimed by mechanics and towing companies.

There are special rules for making sure there’s a right to such a lien, so it’s good to talk to an attorney if you have any questions.

For instance, if contracting work is authorized by a tenant, extra care is required. [Read more…]

‘Paid sick leave’ laws appear to be spreading

There are no federal laws in the U.S. that require businesses to pay workers for sick days. The closest thing is the federal Family and Medical Leave Act, which requires larger companies to offer up to 12 weeks of unpaid leave to workers with a serious medical condition.

But some cities and states are beginning to require paid sick time. Connecticut adopted such a requirement in 2012, and bills have now been introduced in the legislatures in Arizona, Hawaii, Maryland, Michigan, New Jersey, New York and North Carolina.

In addition, paid sick time laws have been adopted recently by a number of cities, including New York; Washington, D.C.; San Francisco; Portland, Oregon; and Jersey City, N.J. [Read more…]

Sale of business interests can trigger surprise tax result

Did you know that if more than 50% of the interests in a partnership or a multi-member LLC are transferred within a 12-month period, the entity technically ceases to exist under federal tax law?

That’s true even if the business continues to operate as normal for all other intents and purposes.

This “technical termination rule” isn’t the end of the world, but it’s something you need to be aware of. For one thing, a special tax return is due within a few months after the “termination” occurs. Recently, one family business was hit with more than $12,000 in IRS penalties and interest because the family didn’t realize they needed to file such a return. [Read more…]

Don’t skimp on protecting your trademarks

You may have heard that you don’t actually have to register a trademark; you only have to use it in business to have a right to it. That’s true to some extent – but beware!

Before investing in a business name, symbol, type of packaging, or any other distinctive representation of your business, it’s worth paying to conduct a trademark search. Sure, you could look around on Google, but that’s not the same thing as a proper trademark inquiry. The consequences of discovering too late that someone else is already using your idea are very serious. You may have to defend against a lawsuit, or destroy all your marketing materials or merchandise and start over from scratch – or both. [Read more…]

Your non-compete agreements are protecting you, right? Maybe not

A lot of companies have a stack of signed non-compete agreements on file, and they assume that they will protect them in the event that a key employee leaves and wants to work for a competitor. But just because you have a signed agreement doesn’t mean it will work the way it’s supposed to.

The law concerning non-compete agreements changes frequently, and it’s a good idea to review these agreements regularly with an attorney to make sure they’re up-to-date. This is especially true if you have employees who work in more than one state.

Here’s a look at some of the issues that can come up:

Have the employee’s responsibilities changed? Last year a court in Massachusetts threw out a non-compete agreement signed by a staffing company COO who left to form a rival company. The agreement had been signed 15 years earlier when the employee was first hired as a branch manager. The court said the non-compete couldn’t be enforced because the employee had been promoted several times over a 15-year period, and his job simply was no longer the same. [Read more…]

Download your old tax returns directly from the IRS

Now you can download your individual tax returns from the last few years directly from the IRS. This might be very helpful for all sorts of reasons, including applying for certain small business loans.

To begin, go to http://www.irs.gov/Individuals/Get-Transcript

Your injury and illness records might have to be made public

OSHA has proposed a new rule that could require many businesses to submit their injury and illness records to the agency as often as quarterly. The new rule would also allow OSHA to post these records on its website for all the world to see.

Businesses are concerned about this rule for several reasons. One is that the added collection of injury and illness records could trigger an OSHA inspection. That’s true even if a reportable event wasn’t the company’s fault – if a serious injury were caused entirely by employee misconduct, for instance, it would still have to be reported to OSHA as an injury and could trigger extra scrutiny. [Read more…]

U.S. clarifies its position on using job applicants’ criminal history

The federal Equal Employment Opportunity Commission recently clarified its position on when employers can reject job applicants based on their criminal records.

The EEOC is highly skeptical of companies that have a blanket ban on workers with criminal records, because it believes such a policy disproportionately discriminates against minorities.

However, it recognizes that a criminal background can legitimately disqualify workers for certain jobs.

According to the agency, it’s okay to take criminal history into account as long as it’s actually relevant to the position. This means that a company should “target” its background screening by considering (1) the nature of the job, (2) the seriousness of the crime, (3) the relevance of the type of crime, and (4) how long ago the crime occurred. [Read more…]

Workers’ wearable technology will create new headaches for business

Over the next few years, we’ll see the very rapid adoption of wearable technology – smartwatches, Google Glass, and other miniaturized connectivity devices.

It’s not hard to imagine how employees with these devices could create problems for businesses. Think of a service employee whose smartwatch displays inappropriate text messages or images, an accounting worker whose Google glasses capture salary data and automatically upload it to social media, or a home health aide whose smart bracelet updates the world on her location – even though the home addresses of her clients are supposed to be confidential.

It’s not too soon to think about updating your cellphone, social media, and other policies to take these new devices into account. [Read more…]

You must protect employees from sex harassment … by customers

Everyone knows that businesses can be sued for sex harassment if an employee or manager harasses another employee. But did you know that you can also be sued if the harasser doesn’t work for you – if the harasser is a customer, contractor, or other person connected to the business?

That might not seem fair, since you have no control over a customer’s actions. But you still have a duty to provide a way for employees to complain, to investigate accusations, and to take reasonable steps to stop any harassment to the extent possible.

In one recent case, a graduate student who worked as a manager for the Hofstra University football team sued the university, claiming she had been harassed by some of the football players. [Read more…]

Be careful about copyrighted images on websites, sales materials

Graphic designers often like to “borrow” photographs and other artwork in order to create websites, brochures, direct-mail solicitations and other materials. But it’s important to make sure that you have a legal right to the images and designs you’re using.

A company called Dream Communications found this out the hard way recently, when a designer used a photograph without permission in creating an online magazine about luxury homes in Hawaii. The owner of the image sued, claiming that it was entitled to almost $8,000 in licensing fees.

But Dream’s problems became a nightmare when a court added penalties under the federal copyright law. In the end, Dream was ordered to pay the owner $45,000 in damages, plus almost $7,000 in attorney fees and costs. [Read more…]

Businesses struggle to decide on e-cigarette rules

Most businesses ban smoking in the workplace, but what about the new electronic cigarettes? Should those be banned as well?

E-cigarettes convert a liquid, which may contain nicotine, into a vapor. Some companies want to encourage e-cigarettes as a way to help workers quit smoking – which can reduce absenteeism and health costs.

On the other hand, some businesses see e-cigarettes as simply a milder, but still harmful, version of regular cigarettes. And they say little research has been done on the effects on co-workers of inhaling secondhand vapors.

The law is still developing. Some 24 states currently ban regular cigarette smoking in the workplace, but only three also ban e-cigarettes (New Jersey, North Dakota and Utah). [Read more…]

Can you sue for a bad online review?

Online customer reviews have become a very important part of retail business. In one recent survey, two-thirds of shoppers said they consulted online customer reviews before buying. Of those, 90 percent said their buying decisions were influenced by positive reviews, and 86 percent were influenced by negative reviews.

A one-star increase in a restaurant’s Yelp rating led on average to a 5-9 percent increase in revenue, according to a recent Harvard Business School study. And a one-point increase in a hotel’s score on Travelocity and TripAdvisor allowed hotels to increase their rates by up to 11.2 percent, according to an analysis by Cornell University.

With online reviews becoming so important, it’s no wonder businesses get upset when customers post negative reviews, especially if the business thinks the black marks were undeserved.

But is there anything you can do about it legally? [Read more…]

Direct deposit can be required…if there’s an ‘opt-out’

Most employers find that paying workers through direct deposit is far simpler and easier than paying via check. But can employers force employees to accept direct deposit?

Well, not exactly. According to the Department of Labor, you can’t refuse to pay people by check if they really, truly insist on a check. However, you can make direct deposit standard practice, and you can force people who don’t like it to “opt out”…as opposed to inviting people who want it to “opt in.”

Some states have additional rules and restrictions on direct deposit, though, so it’s important to speak with an attorney before you make a change in policy.

No more ‘automatic tips’ for large groups at restaurants?

Many restaurants and other businesses automatically add a tip to the bill for groups over a certain size. But that’s likely to change in 2014, thanks to a new decision from the IRS.

As of January 1, 2014, these automatic tips must be treated as “wages,” subject to payroll tax withholding. This will mean much more paperwork for the businesses (not to mention making the waiters and other servers unhappy).

Darden Restaurants, which owns the Olive Garden, Red Lobster and Longhorn Steakhouse chains, has announced that it is experimenting with getting rid of automatic tips. Many other service businesses are expected to follow suit.

New rule on when same-sex spouses are entitled to FMLA leave

Here’s a complicated wrinkle for businesses that have employees who are in a same-sex marriage.

The question is whether these employees are “married” for purposes of the federal Family and Medical Leave Act, such that they’re eligible to take time off to care for a spouse.

Previously, the IRS has ruled that employees are “married” for purposes of employee benefit plans if same-sex marriage is legal in the state where the marriage occurred.

But now, the U.S. Department of Labor says that employees are “married” for purposes of FMLA if same-sex marriage is legal in the state where the employee resides. [Read more…]

Companies may have to force employees to use safety equipment

If an employee is going to be working in hazardous conditions, does the employer merely have to provide appropriate safety equipment … or does it have to actually force the employee to use it?

The latter, according to the OSHA Review Commission.

The case involved a marine contractor in Florida that was renovating a boat ramp. An employee of the contractor was observed using a jackhammer on concrete without wearing goggles or earplugs. [Read more…]

What to consider before signing a contract with a software vendor

Many contracts that a business will sign with a software vendor (or any other professional service provider relating to software) involve sharing detailed business or customer data. This is especially true with any type of cloud computing service. Before you sign a contract, ask yourself these questions:

What can the provider use my data for? Obviously, a vendor needs to be able to use your data to provide you with the contracted services. But many standard contracts also allow the provider to use the data (typically in aggregate form or without specific customer identifiers) for a number of other purposes, such as improving its own products, or even selling it to third parties. Do you really want your customer data treated in this way?

Will the data be safe? What systems does the provider have in place to maintain security? These can include passwords, antivirus software, alarm systems, limits on which of the vendor’s employees have access to the data, and backup and disaster recovery systems. [Read more…]