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Archive for March 2011

Wistleblowers and Employers

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What is a whistleblower? A whistleblower, quite simply, is someone who alerts government authorities about illegal activities in the workplace. Whistleblower laws enable workers to make such reports without facing termination or other disciplinary actions by their employers. These employee protections help ensure that unfair, corrupt or dangerous practices see the light of day, ultimately allowing for a safer and more positive work environment.

Different whistleblower laws cover different kinds of infractions. The Occupational Health and Safety Act, of course, focuses on issues pertaining to health and safety. A variety of industry-specific or infraction-specific acts support this legislation. The Surface Transportation Act, for instance, protects trucking industry workers who experience discrimination for reporting safety or health violations to OSHA. The International Safe Container Act protects workers who report unsafe cargo practices, while the Clean Air Act and Safe Drinking Water Act protect employees who report environmental violations. Another law, the Sarbanes-Oxley Act of 2002 (also known as SOX), looks out for employees who report securities fraud.

In some cases, an employee’s whistleblower rights may trump other situations in which that employee might normally face termination. For example, businesses must set specific policies on how their employees use social media and discipline those who abuse their online privileges to libel the business. But what if a worker uses a company blog to report illegal company activities? Well, if that blog exists to allow management to discover and stamp out such things, then under SOX that worker is a whistleblower, not a crank, and so cannot be punished or fired for his action.

You can see why many employers opt to turn these complex issues over to an HRO! If you think you might want to do the same, contact us and let’s discuss it.

Dan Hettrich is the director of sales at Acadia HR located in Austin, Texas. He can be reached at or 512-745-2985.

Written by Dan Hettrich

March 31, 2011 at 8:29 am

Posted in Uncategorized

EPL Insurance: How It Works, Why You Need It

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In the last 10 years a new kind of corporate liability insurance has found its way into the lexicon of American business.  Employment Practices Liability Insurance, or EPLI insurance, has become an increasingly popular supplement to Workers Compensation among employers. Like Workers Comp, EPL insurance protects business against possible lawsuits and/or judgments and the massive loss of money that may result. Unlike Workers Comp, however, EPLI doesn’t cover injuries or illness — instead, it protects businesses against liability for claims brought by employees who allege employment-related wrongful acts.

Understanding EPLI.

EPL insurance covers many kinds of employees, from full-time staff to temporary, seasonal and part-time workers from claims brought under the Equal Employment Opportunity Commission, or EEOC. Depending on your policy, it can also cover liability over sexual harassment, lack of ADA compliance, discrimination and violations of the Fair Labor Standards Act. Your total protections typically range from $1 million up to $5 million, with premiums starting at around $1,000 per year.

EPL insurance offers a potentially business-saving advantage to your company — it covers not only any judgment you might have to pay but also your legal defense costs. More and more small business owners are realizing that while a global enterprise might weather the costs of a big lawsuit, a decent-sized chunk of attorney time could sink a new, smaller-scale or struggling business completely. And if, like so many small business owners, your own fortunes are tied directly to the fortunes of your company, you might end up sinking too.

Even if you take great care to establish, practice and document your equal employment opportunity and fair treatment policies, you don’t want the occasional rogue lawsuit draining legal fees from your company’s coffers. Contact Acadia if you have additional questions about how various kinds of liability insurance can help protect your business.

Dan Hettrich is the director of sales at Acadia HR located in Austin, Texas. He can be reached at or 512-745-2985.

Written by Dan Hettrich

March 29, 2011 at 12:50 pm

Posted in Uncategorized

Workers Compensation: Dollars and Sense

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In our previous post we covered the basic definition of Workers Compensation and its tremendous value for companies to protect themselves against lawsuits from employees with job-related injuries or sickness. So if you’ve decided that your business needs Workers Compensation, the next question is: How much does it cost?

One Price Does Not Fit All. As you can imagine, some industries or occupations place their workers at a higher risk than others. A roofer obviously stands more chance of getting hurt than a cubicle worker. For this reason, insurance providers rate Workers Compensation rates according to the relative risk, just as they would any kind of personal insurance. Different worker classifications on your payroll will cost varying amounts to cover. And in this ‘soft market’ environment, pricing across different carriers can vary substantially – this is a good time to review your costs with an advisor.

Keeping Costs Down. If Workers Compensation rates are pre-determined by occupational injury risks, then does that mean that you’re powerless to control how much your coverage will cost you over time? Not at all! You can still control one huge factor of the Workers Compensation equation – how much abuse the policy will suffer at the hands of its employees.

It’s an unfortunate fact that while most injured employees genuinely need Workers Comp and use it appropriately, a few bad apples will always try to game the system for their own convenience. There are a number of things you can do to limit your liability and control costs. During the hiring process, make sure your application has a question regarding the candidates ability to perform the duties of the position (be careful on the wording of this question to avoid ADA issues), and in many instances, utilize background checks for all new employees. The greater the physical demands on your staff, establish safe workplace policies and initiate worksite training programs (lifting, slip & fall prevention, repetitive motion, etc.). Finally, engage your Property & Casualty advisor to do site inspections whether you have an office environment, manufacturing, warehousing, etc. Most advisors are adept at identifying and directing you to loss prevention and safety resources that will help manage your risk, liability and long-term costs.

Workers Compensation carries one other potential benefit that makes it even more affordable. Recently passed legislation now allows businesses that use a network of preferred medical providers to discount 8 to 15 percent off their premiums – review your policy with an advisor to make sure you are taking advantage of this cost control feature.

Thanks again to David Miller, VP, Small Business Insurance at Eckert Insurance for his insights on risk management and mitigation. Please feel free to contact David at or (512)472-6969 with any questions.

Dan Hettrich is the director of sales at Acadia HR located in Austin, Texas. He can be reached at or 512-745-2985.

Written by Dan Hettrich

March 25, 2011 at 12:27 pm

Posted in Uncategorized

Why Employers Should Consider Workers Compensation

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Employers want to ensure that they are doing right things to protect themselves from liability, but because Texas is one of the few states where Workers Compensation is elective, it’s often overlooked. is crucial to the survival of many businesses, but it is often overlooked because it is elective in the state of Texas.

The fact is, Workers Compensation can be crucial to the survival of many businesses, and there are many ways to control costs. Recently, there has also been a useful add-on called EPL insurance (EPLI) that provides additional protection in the case of an employee-initiated lawsuit.

Here’s a straight-forward assessment on what you need to know about Workers Compensation so you can make an informed decision about the applications in your company:

The Least You Need to Know. Workers compensation is a program that businesses offer as a standard, statutory benefit to employees who are injured while working or experience job-related illnesses in the workplace. A typical Workers Compensation program will cover medical expenses such as surgery, hospital stays, rehab or prescriptions while ensuring that the employee continues to receive a paycheck during the recovery period. This compensation makes it unnecessary for the employee to sue the business for the event that led to these expenses.

Why You Need It. While the state of Texas doesn’t require all businesses to offer Workers Compensation to their employees, not doing so may put your company at considerable risk. You can imagine what would happen to the fortunes of even the richest company if enough of its workers got sick or hurt on the job and decided to sue for lost wages and medical expenses. For smaller companies, the potential financial burden only becomes greater with each individual case. Worse, if you have no Workers Compensation program in place when your employee sues for compensation, you’ll automatically waive your common-law defenses in the case. On the positive side, Workers Compensation makes your company more attractive to top-drawer prospective employees.

What You Get. A Workers Compensation policy is a pure form of risk transfer – the financial liability of work related injuries and sicknesses, for both medical and income benefits, are now contractually covered by the policy. Additionally, due to the ‘exclusive remedy’ nature of Workers Compensation policies, the companies exposure to lawsuits and legal fees are significantly reduced unless the harm to the employee resulted from the employer’s intentional act or gross negligence. In addition to the benefits to the company, the employees also benefit by being covered for work related risks.

A recent example demonstrates the risks associated with work related injuries. A furniture store had an employee fall off of a step ladder and incurred minor injuries. The total expense of legal defense and award paid to the employee was $35,500. Following settlement of the case, the company purchased Workers Compensation coverage for annual premium of $6,000. Not only was the law suit disruptive to day to day business, but the cost/award hurt cash flow and was more than 5 times the cost of insurance.

For most companies with gray and white collar employee populations, the cost of WC is minimal, particularly in comparison with the risk. Please take a moment to assess your risk, and we are pleased to be able to recommend David Miller, VP, Small Business Insurance @ Eckert Insurance to assist with risk evaluation and customized proposals. David can be reached at or (512)472-6969.

Stay tuned for a discussion of the financial side of Workers Comp.

dan hettrichDan Hettrich is the director of sales at Acadia HR located in Austin, Texas. He can be reached at or 512-745-2985.


Written by Dan Hettrich

March 18, 2011 at 1:58 pm

Posted in Uncategorized

Social Media and Employees: Social Media as a Hiring Tool

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Social media has grown into a powerful, versatile, efficient tool for HR departments and jobseekers alike. Some major corporations have gone so far as to build full-featured Facebook sites, including interactive message boards, job search engines and helpful tips from the HR staff to facilitate their hiring process.

As useful as this technology can be, however, it also opens the doors for certain problems and risks for employers. If you plan to use social media in helping you find the best and brightest – or to help them find you – make sure you’re keeping your eyes open. A couple of tips:

  • Don’t invite a discrimination lawsuit. If employees believe you passed on hiring them due to their ethnic background, physical disability, or any other legally-protected classification, you could end up facing a legal battle, and the accompanying bad press, for something you never did. But the fact remains that if you even view such information, deliberately or accidentally, you have exposed your company to possible liability. You may want to exclude as many of these factors as you can from your Web-based applications, or have a third party remove any potential “hot potato data” before you review them.
  • Just because it’s on the Internet doesn’t make it true. Just as job applicants can misrepresent on an application form or attach fraudulent documentation, online applicants can feed you misleading or false information through social media channels. They may refer you to all kinds of information on blogs, industry bulletin boards or Facebook apps containing “facts” that turn out to be fiction, costing you valuable time and effort and possibly even making you hire the wrong person for the job. As always, the final candidate selection process should include professional reference and background checks to formally validate information on a candidate’s application.

As we have discussed different exposures of employment in past blogs, we have provided suggestions for protecting business owners and promoting profitability. Different company cultures may be such that a business owner doesn’t need to adhere to all recommendations, but there is a baseline of applicability to limit liability.

As Social Media continues to evolve, we hope that some of our commentary reminds you of, or helps identify, exposures implicit in operating your business in a greater social view.

How are you using Social Media to recruit employees in your organization?

Dan Hettrich is the director of sales at Acadia HR located in Austin, Texas. He can be reached at or 512-745-2985.

Written by Dan Hettrich

March 8, 2011 at 3:27 pm

Posted in Uncategorized