While it’s not unusual for small business owners to downplay the importance of labor law posting compliance, this shortsighted thinking could come back to haunt them.
Failure to display complete and current workplace postings can deliver a one-two punch: government fines (which can add up fast) and potential employee lawsuits (which could devastate a small business). Let’s consider how these two very real factors could get you in trouble – and how to better protect your business.
While on the Premises, Agents Will Check Postings
Although there’s no such thing as “poster police” – and it’s unlikely government agents will knock on your door just to check postings — the risk of citations and fines emerges another way. At the federal level, most posting fines are assessed when agencies conduct an I-9 audit, an OSHA inspection, an EEOC investigation or even a DOL follow-up to an employee complaint. On the state and local level, employers may be subject to random government audits when an agency or state attorney conducts a sweep of businesses.
While on the premises for these reasons, agents will check your postings and issue fines if they are incomplete or outdated. The complaint or investigation could be completely unrelated to labor law posters, but your postings will be scrutinized as part of the onsite visit.
The federal posting fines are steep at more than $35,000 per location, a cost that will rise significantly if you have violations at multiple locations. State, county and city-level fines are typically between $100 and $1,000 per violation. (Each posting carries its own fines, as every agency and posting law differs.
The Threat of Legal Complications
The bigger risk of noncompliance is related to employee lawsuits. Missing or outdated postings can extend the statute of limitations, as well as result in higher damage awards due to evidence of bad faith. Here’s a closer look at how this comes into play:
- Statute of limitations — This is an important legal protection for employers because it allows you to dismiss a claim that was filed too late. For example, the statute of limitations for a federal discrimination claim is 300 days; for an FLSA overtime case, two years. Typically, if your business gets a claim from a former or existing employee outside of this time period, you can move to have it dismissed.
- However, in the case of posting violations, the courts may ignore the statute of limitations because you didn’t properly notify employees of their legal rights and responsibilities. This means the legal proceeding can move forward.
- “Bad faith:” This is another area of concern if an employee files a lawsuit over the violation of his or her workplace rights. In a discrimination or fair pay case, for example, failing to post could be evidence of “bad faith”: a term that refers to an intentional dishonest act by not fulfilling your legal obligations. A finding of bad faith can inflate a damage award against you, or erode a good-faith defense that would otherwise reduce or eliminate damages.
Protect Your Business with Complete Posting Coverage
Remember: In any given year, nearly half of all federal and state posting changes are considered mandatory, requiring either new postings or replacement of outdated ones. While staying on top of posting laws can be time-consuming and complex, ignoring them is a risk you simply can’t afford to take. Poster Guard® Compliance Protection gets your business up to date with all mandatory labor law postings — and keeps it that way for an entire year. It’s comprehensive coverage that protects your business from fines, penalties and related employee lawsuits for invaluable peace of mind.