By Heather Sager

Law360 (December 16, 2020, 5:38 PM EST )

Heather Sager

For retailers, the holiday season is indeed the most wonderful time of the year: increased foot traffic, increased revenue and endless loops of cheerful holiday music on the in-store system. But increased stock and sales mean retailers typically need to increase staffing and hours for employees while also minding their tight labor budgets, particularly in this day and age.

Add to this the need to track and comply with ever-changing local regulations regarding COVID-19, and the holiday season definitely creates inherent risk on the employment law front.

Here are a few tips to help you avoid violating key employment laws this season.

Beware of elves in managers' clothing.

Store managers are often paid on a salaried basis and are not eligible for overtime because of their executive functions. However, if stores are short-staffed, managers sometimes do less supervising and more hourly work, which can impact their exempt classification.

Salary rates alone are not enough to support overtime exemptions. Be sure to reinforce job duties; if managers are demonstrating tasks, that's fine, but if they spend the majority of their time on such functions, you might have some risk they will be found to be hourly employees eligible for overtime.

Misclassification claims often are filed as class or collective actions, alleging whole categories of employees are eligible for overtime, leading to related violations of timekeeping and payroll regulations. Remember, if it looks like an elf, it probably is one.

Pay attention to everyone's wish list.

One of the best ways to avoid workplace risk at any time of the year is to have an open line of communication with your employees. Listen, and make sure to follow up even if your response is not what the employee wanted.

Individuals want to be heard; if you are not there for them, a plaintiff's lawyer might be. It is crucial to offer employees multiple options for reporting workplace concerns, including but not limited to their supervisors, human resources representatives or even workplace hotline numbers. 

There are third-party services that can host anonymous hotlines. If you go this route, then you need to ensure that you actually check the hotline records and follow up on issues raised through that avenue. Take the time to pay attention to what your team is concerned about; it's the best investment you can make. 

Monitor all compensable time.

This time of the year, everyone wants to be on the nice list. Employees might volunteer to come in early to help unload new shipments or stay late to help tidy a store that's been picked over for hours. Your employee of the month could be your greatest risk. 

While this sort of initiative is well-meaning, employees should never be performing services off the clock. Remember, this time is compensable even if not approved or required — just like Santa, the employer is presumed to know everything.

So, while you may neither have expected nor asked an employee to work off the clock, if you know about it, you need to pay for it — though you can also take disciplinary action for employees' failure to accurately record all of their time for payroll purposes. At least the naughty employees make it easy to take disciplinary action.

Implement COVID-19 safety precautions.

Social distancing, masks and abundant awareness of physical surroundings are now ingrained in all of us. It is important for employers to set and enforce policies to limit community transmission of illnesses.

Employers can readily implement floor markings, mask enforcement and store population limits. But not all employers have robust employee screening procedures or consistent responses to potential exposure or positive virology tests in the workplace population.

Decisions about workplace safety measures in light of the COVID-19 pandemic are under heightened scrutiny. With increased reporting responsibilities in some jurisdictions and increasing litigation against employers related to alleged failure to prevent workplace transmission of COVID-19, now is the time to get your house in order.

Carefully assess privacy issues.

From social media influencers sponsored by companies and intuitive marketing driven by internet searches to artificial intelligence, contact tracing, employee health screenings, and employer-sponsored virology tests — our society is currently facing a struggle between individual privacy rights, innovative targeted marketing enabled by algorithms and user trends, and information gathering inspired by efforts to curtail the COVID-19 pandemic.

Employers' choices regarding what tools to use to track data, what they ask of employees and consumers and how they ask it, and how or if the responsive information is stored or shared all carry legal implications that must be carefully assessed.

Even collecting individual visitor's names and contact information can require complicated disclosures regarding the retention and use of the data. There is a complicated interplay between consumer research, workplace safety and individual privacy rights, and what might be permitted in one context, might not in the others.

Don't ignore harassment concerns.

We are living in a time where the idea of sitting on a stranger's lap, even one who is jolly and generous, is nearly unimaginable. In addition to the COVID-19 transmission concerns, recent headlines have increased awareness of inappropriate workplace behavior. 

Seemingly harmless comments or joking actions often do not feel that way to those who witness or directly experience the behavior. Remember that harassment is judged by the effect it has on the person who experiences the behavior at issue. Intent is not relevant. Even implied pressure to engage in workplace behavior that makes someone uncomfortable can be enough to create risk. 

Schedule time for holiday cheer. 

Increased consumer traffic, additional shipments and concerns about socializing due to potential community transmission of COVID-19 can leave staff short on break time. Not only are breaks important from the perspective of mental health and employee morale, in many jurisdictions they are also required by law.

Including employee break time on the schedule can help you better plan for coverage and better monitor for compliance. Shift supervisors should regularly remind people of breaks and ensure coverage to enable the same. And if you are in California, make sure you have records of meal and rest breaks. If you don't, make sure you are paying penalties where appropriate.

Like the North Pole, retail operations during the holidays work best when everyone works as a team. Keep the lines of communication open and remember to call in reinforcements when you need them. 

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Heather Sager is a partner at Perkins Coie LLP.

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

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