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Recent events, such as the shootings at a nursing home in North Carolina and an immigration center in New York, illustrate the need for employers to pay attention to the risks of workplace violence and take protective measures.   According to the latest survey of fatal workplace injuries by the U.S. Department of Labor’s Bureau of Labor Statistics, assaults and other violent acts were the fourth leading cause of workplace fatalities, and workplace homicides amounted to approximately 10% of all workplace fatalities.   Some types of workplaces are more likely than others to experience workplace violence.  The BLS survey indicates that workplace violence is most common at late-night retail establishments such as convenience stores, liquor stores and gas stations.  However, the recent shootings in North Carolina and New York and other shootings and hostage-takings show that all types of employers face some risk of  having an incident of workplace … [Read more...] about Recent Events Illustrate Need for Attention to Risks of Workplace Violence

A recent decision from the North Carolina Court of Appeals shows why it is important to have a clear written agreement or policy on bonuses and commissions. In Kornegay vs. Aspen Asset Group, LLC, a jury found the employer and employee had an enforceable verbal agreement that, in addition to his salary, the employee would be paid a bonus of “20% of the profits” from real estate investment projects he “originated and implemented.” On appeal, the employer argued there was insufficient evidence to support the jury’s verdict because the parties had negotiations for the employee’s bonus but intended to reach an agreement on the bonus only if and when it was put in writing and signed by both parties, which never happened. The Court of Appeals upheld the lower court’s award of bonus compensation based on the jury’s verdict, finding there was sufficient evidence that the employer and employee reached an enforceable verbal agreement on … [Read more...] about Court Decision Illustrates Importance of Having a Clear Written Agreement or Policy on Bonuses and Commissions

My March 24, 2015, post discussed the “true value” of a property/casualty insurer’s float, which includes not only the return the insurer makes on the money borrowed from its policyholders to pay future claims (i.e., total premiums), but also the avoided cost of borrowing that money (i.e., the “use value”). A few years ago I illustrated this point to the Minnesota legislature by compiling the following data on several insurers during a 15-year period, showing that the true value of the insurers’ float during that period averaged 24.1 percent per year – substantially higher than their average reported return on investment of 13.8 percent per year, and far higher than the single-digit statutory rate of prejudgment interest in a number of states that promotes insurer delay. For those who may wish to seek legislative reform on policyholder remedies, this type of data can be readily replicated from publicly available sources. Click here to download … [Read more...] about Minnesota: More on Insurers’ Float – an Illustration

In the recent bid protest decision of Halbert Construction Company Inc., the Government Accountability Office (GAO) illustrated the breadth of a procuring agency’s discretion in conducting a past performance evaluation.  Halbert Construction brought the protest after being excluded from the competitive range, arguing primarily that the Navy unreasonably included a non-relevant prior project in the past performance evaluation which led to Halbert Construction’s exclusion.  The GAO sustained the protest based on the well- established principle that offerors must be treated equally because the Navy excluded another offeror’s past performance reference from the evaluation as not relevant under the solicitation’s relevancy criteria but then failed to do the same for the protestor.More notable than the relatively straight-forward application of the disparate treatment principle was the decision’s discussion of the very broad discretion of agencies … [Read more...] about GAO Decision Illustrates Breadth of Agency Discretion in Past Performance Evaluations

Over the past two years, the SEC has increased its focus on enforcement actions against companies for lack of internal controls in proceedings that have spanned a range of industries and have implicated several distinct accounting issues. The cases demonstrate that the SEC is not aiming to second-guess good-faith decisions, but that it nevertheless will take decisive action when it believes management turns a blind eye to red flags. These actions serve as a potent illustration of the importance of implementing, maintaining, and verifying internal controls at various levels, and of ensuring that directors stay informed and active in their oversight of financial reporting. In addition, these cases provide companies with insight into specific steps that they can take to lessen the prospect of becoming a target for an enforcement action. Stein Mart, Inc.The SEC instituted cease-and-desist proceedings in September 2015 against Florida‑based retailer Stein Mart that stemmed from Stein … [Read more...] about SEC’s High Priority Financial Reporting Cases Illustrate Importance of Verifying and Maintaining Rigorous Internal Controls