Compliance Counselor
But Shouldn't I Get Paid For Thinking About My Job When I'm At The Ballgame? Wage And Hour Risks
With millions out of work and looking futilely for work and millions more workers dropping out of the labor force altogether, nobody looks anybody straight in the eye these days to say, "The employment situation is wine and roses." Despite a recent "technical dip" in the nation's unemployment rate, too many people are out of work. And both Management and workers on the job have their hands full trying to make do with less. That is, workers are doing more and employers have less of a workforce. In a strange way, that makes the surviving employees stronger. An employer can't cut back to zero. At the same time, productivity gains can only take a company so far before workers yell, "Uncle." Not that the CC has any inside dope, but don't be surprised if there is an uptick in wage and hour claims before the unemployment rate drops back down to more historically normal levels. Yeah, wage and hour — there's a subject the CC hasn't dealt with much. The variety of such claims could be nearly infinite as economic developments reshape what constitutes work. So how can you respond when a client calls you to ask if he has to pay a worker "sleepy time" because he keeps his BlackBerry under his pillow?
It Pays To Do Executive Compensation Right — Compensation Best Practices For A Tough Crowd
Richard C. Ferlauto (AFSCME) begins Compensation Best Practices Overview with the missive "Compensation is an annual concern." Of course, with pay czar Kenneth Feinberg overseeing the compensation of companies that received TARP funds, with Congress making noises about excessive compensation, and with the citizenry (not to mention shareholders) seemingly on the verge of revolt, one could say that compensation has become a constant and systemic concern. And that makes it a concern for you, as you deal with boards and executives whose decisions and livelihoods are impacted by the latest challenge to how they are paid. The time for some ideas just comes, and with 75 percent of directors and investors agreeing that the "U.S. executive pay model has hurt corporate America's image," that time may be now. So how do companies compensate fairly without paying the piper of public derision and regulatory impingement?
But Do We Have To Lower Our Firewall For This? Using Web Sites As A Means of Public Dissemination
Last week, the CC took a look at Reg. FD and disclosure, generally. Within that discussion, the CC made passing reference to the problems of inadvertent disclosure in a web world. This week, we'll make that passing reference the subject of the entire issue. For what is the most likely transmission route to get information out to the world at large if not a company's website? Of course, that isn't as simple as just uploading some information and saying, "Voila, we're done." Trouble abounds with the web as a disclosure resource. As Keith F. Higgins (Ropes & Gray LLP) notes in today's fascinating download, Using Web Sites as a Means of Public Dissemination: The Commission Guidance, companies have been trying for years to figure out how best to "use electronic media, including posting on its web site, to satisfy...obligations to disclose or deliver information under the securities laws," even since the SEC released its guidance on Use of Electronic Media for Delivery Purposes in 1995. He notes that things haven't really changed since then, and "we have yet to establish a comprehensive scheme that provides companies with certainty in application." So just how is it that companies can use their websites to satisfy disclosure requirements without getting caught in a web of their own making?
Disclosure Policies Ought Not Be Kept Secret — Sample Company Disclosure Statement
In a few months' time (ok, August to be exact) Reg. FD will celebrate its tenth birthday. The CC decided to celebrate early. Adopted to level the disclosure playing field, Reg. FD addressed what had been "the selective disclosure of material information to securities analysts and large investors prior to making it available to the general public." Arms, Living with Regulation FD (from 14th Annual Preparation of Annual Disclosure Documents, Ch. 14, PLI 2009). Ever since, companies have had to be more circumspect about disclosures to individual analysts, and since immateriality is the only defense to a charge of violating Reg. FD, there is ample incentive to walk the straight and narrow. But in a world where information has become commoditized, it can be difficult for even the best-intentioned company not to stray from the path every now and again, especially when employees are zipping around the web or whipping off text messages on their BlackBerrys. When a slip of even the best-kept secrets means having to broadcast them worldwide, how can companies ensure they are disclosing only what, when, where and how they want?
Make Effective Compliance A Team Sport: Sample Operating Agreement Between Compliance Department And HR Personnel
We talk about compliance in this newsletter primarily as it pertains to lawyerly advice. But the truth is that effective compliance programs are actually aimed at rank and file employees of corporations — do this, don't do that, do keep records, don't harass, etc. It's easy to stand on high and tell clients, "This is how it's done." On the ground, things are not that simple. A great compliance program is useless without buy-in from everyone at a company. That means from CEO on down, the culture must be clear, and everyone must know the plan. Practically speaking, however, the plan is implemented further down the food chain than management and lawyers coming up with organization-appropriate compliance plans. For the average employer, the "marching orders," for lack of a better term, will come from their direct managers and human resources. So what's a lawyer to do to get the people at the top and the people on the ground working together on the same level?
What We Have Here Is A Failure To Telecommunicate — The Year In Telecom Regulation
A belated Happy New Year. The CC would have been here last week, but DVR'd so many programs and football games and was reading so many blog posts that it simply lost the time. Such is early 21st Century life that we are able to occupy ourselves 24/7 with the products of the telecommunications industry. And because communications are so ubiquitous, Congress finds lots of issues to get involved in. And 2009 was no exception.
Building Anti-Corruption Compliance, One BRIC At A Time — FCPA In The New World Economic Powerhouses
Time to put a coda on 2009, and what a year (two years) it's been. When
this newsletter began back in 2004, the compliance issues the CC dealt
with had a decidedly domestic bent: the new rules of the revolutionary
Sarbanes-Oxley Act, HIPAA and other concerns of a new era of digital
communication and a highly mobile workforce. Six years later, and a
review of the publication schedule shows we've taken a big step off the
shores of the U.S. and, along with American business, found ourselves
well-entrenched with issues arising from global trade. As the formerly
"emerging markets" emerge and then surge, your clients use them more
and more as producers, servicers and customers. That has expanded
compliance into a worldwide phenomenon.
Globalization has brought the Foreign Corrupt Practices Act
(FCPA) into sharper focus, and the CC has periodically looked at how it
impacts business overseas. To close out volume six, we'll do so again.
The BRIC countries (Brazil, Russia, India and China) are large drivers
of economic development and represent huge and growing markets for U.S.
companies. And the cultural and business practice differences between
those countries and the U.S. can make FCPA compliance tricky. But
trickiness doesn't excuse compliance with the letter of the law. So,
assuming things continue on the current path and these countries
(particularly, the B, the I and the C) dominate particular arenas of
future business growth, your clients have to be concerned with FCPA
matters. How do you guide them so they don't end up with violations
that hit them like a ton of bricks?
Unemployment Hits PERM Market, As Well: Immigrant Worker Certifications In A Down Economy
With new unemployment numbers at 10.0% (with alternate, though unofficial
Bureau of Labor Statistics estimates
as high as 17%), to think that any area of the economy has not been hit
would be naïve. To think that the (lawful) immigrant labor market has
not been hit would be, well, unthinkable. And indeed, along with the
rise in unemployment, the waiting time for the Department of Labor
(DOL) to adjudicate Program Electronic Review Management (PERM)
certifications has skyrocketed (from the normal 45-60 days to
six-to-nine months and more).
Without a PERM certification, there is no employment-based immigration.
Your clients who have specific employment needs that cannot be
fulfilled by the domestic labor force rely on PERM certifications to
supplement that force. But when unemployment is at levels not seen in
decades, well, you can imagine it may be much more difficult and
time-consuming for the DOL to determine, as it must, that there is no
available citizen to do a job. And what's more, DOL makes
determinations of worker availability long after an employer requested
them, which means the labor market may have changed yet again. Yet your
client's needs may still be going unmet. So how can an employer get
some PERManent help in a job market that is, at least temporarily, on
shaky ground?
Pay-to-Play Laws Here To Stay? Part Deux — SEC Moves To Restrict Influence Peddling By Investment Advisers
Last week, the CC looked at the increasing number of state and local
laws aimed at ridding the political procurement process of apparent
quid pro quos for campaign and lobbying dollars. And lest you think
this is not a big issue, just look at what the SEC is doing in this
arena. Just as background, note that the SEC has been after pay-to-play
for years. If you search the SEC website, you'll find strong public
statements by former Chairman Arthur Levitt going back to the 1990s
denouncing pay-to-play's influence in municipal bond markets and even
commending the ABA for its stance in denouncing the practice by lawyers
and law firms. But for today, we're going to look at a specific rule
proposal that involves pay-to-play and the investment adviser industry.
Pay-to-Play Laws Here To Stay? Increasingly, State And Local Campaign Finance Laws Restrict Influence Peddling
The CC hears the term "pay to play" all the time without knowing
precisely to what it refers — in the "sketchy behavior" sense. That's
because in this life, you pretty much always have to pay to play
whatever it is your playing. That's a given. It's only when we decide
that certain manifestations of pay to play create playing fields so
unlevel (as in only certain individuals and entities can afford to pay)
that we like to undermine it. Such is the case in government, where we
like to think that our representatives are not for sale to the highest
bidder; that there aren't quid pro quos for obtaining contracts from
government; or that judgment is not being clouded by campaign
contributions. And because what we think is not always what happens in
reality, so it is that increasingly, at the state and local levels
especially, pay-to-play laws are cropping up to eliminate conflicts of
interest and the like.
In essence, pay-to-play laws "prohibit a corporation from entering into
business arrangements or contracts with certain governmental entities
if the corporation, its PAC and in many cases certain covered
directors, employees, and their family members (such as spouses or
children) make or solicit political contributions in that
jurisdiction." See Kenneth A. Gross and Ki P. Hong, "State Pay-to-Play Laws" at 1 in Corporate Political Activities
(PLI 2009). And currently 37 states, municipalities and other local and
statewide governmental entities have such laws: California; California
counties; CALPERS; CALSTRS; Chicago; Colorado; Connecticut; Culver
City, CA; Denver; Florida; Hawaii; Houston; Illinois; Jefferson Parish,
LA; Kentucky; L.A. City; L.A. County; MTA Louisiana; Maryland;
Missouri; New Jersey; New Mexico; New York City; Oakland; Ohio;
Pasadena, CA; Pennsylvania; Philadelphia; Rhode Island; Salt Lake
County, UT; San Antonio; San Francisco; South Carolina; Suffolk County,
NY; TX Teacher Retirement System; Vermont; and West Virginia. Running
afoul of these laws can leave your clients in a position where they
will be paying dearly, indeed. So how do you make sure you play without
paying or pay without playing without sitting out the entire game?
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