Professional Service Agreement

The SESCO Report – July 2015

U.S. Labor Shortage Affects All Industries

With the U.S. economy and job market filling the forces of globalization and the ever-increasing pace of technological change, the key to our nation’s economic success in the years to come will be a skilled, well-educated and productive workforce. However, outdated educational practices and school systems are failing to equip students with the knowledge and skills required for the careers that are and will be available into the 21st Century. The education system does not give enough weight and priority to practical workplace skills that prepare students for the real world. Additionally, with U.S. student loan debt reaching $1.2 trillion and the average four (4) year college graduate leaving school saddled with $30,000 in debt, things must change for both employer and potential employee alike. Currently, there are around 10 million Americans who are unemployed and millions of others underemployed, yet over 5 billion jobs remain unfilled because there is not enough talent with the practical, real-world skills that companies need. This skills gap is not only hampering the nation’s domestic growth, it is threatening the country’s economic competitiveness on a global scale.

So how can America close this workforce/skills gap?

1. Lift the stigma hanging over vocational and technical education. Unfortunately, years ago the educational system segregated “vocational and technical educational” programs, thus creating a stigma that these programs were for menial and low-paying jobs. Guidance counselors and teachers alike also reinforced this stigma pushing students to four (4) year degrees. The reality is that today, there is a bevy of respectable, well-compensated, upwardly mobile careers that don’t require a traditional four (4) year education. Unfortunately, vocational study has had a history of being seen as less respectable than attending universities. But with unemployment and underemployment rates of college graduates at such high levels in the U.S., it is time for this perception to change. This must start within our educational systems, guidance counselors, teachers and parents alike.

2. Get young people engaged in the real world of work. Young unemployment today is roughly three times (3x) the national unemployment rate. The reason: too few high school students graduate with marketable skills. The erosion of vocational education, apprenticeships and traineeships in the nation’s secondary schools has practically guaranteed this tragic situation.

Other economically-heathy nations place far more emphasis on vocational education, apprenticeships and traineeships. Among Northern and Central European countries, vocational training is part of mainstream education; between 40% and 70% of high school students opt for vocational education which combines both classroom and on-the-job learning over three (3) years.

Fortunately, the U.S. systems have created the occupation-oriented associated degrees through community and technical colleges. These programs have opened doors of opportunities to millions of young people who have never had the benefit of vocational education in high schools.

3. Arming our future generation with real workplace skills. In the coming decades, the most attractive job candidates in just about every field or industry will be those whose resumes boast not only strong academics, but also a set of practical, “real-world” workplace skills.

Community college is a great place for people to develop both. The skills education acquired at the community college offers graduates the opportunity to command wages and salaries equal to and sometimes better than those graduating with a four (4) year degree. One-third (1/3) of two (2) year college grads with occupational majors, in fact, out earn their four (4) year college peers.

In summary, it is time that all stakeholders to include employers, parents, guidance counselors and teachers begin to rethink the current educational system and skills taught so that future generations will have the real-world skills and talents to succeed.

Welcome Adam Kneisley, Esq.

Please join the SESCO staff in welcoming Adam Kneisley to the SESCO team.

Adam will fill the role of Vice President of Client Services, Labor Law Attorney.

Adam’s experience includes Hearing Officer for the State of Tennessee and practicing attorney.

Adam’s education includes Milligan College and Thomas M. Cooley Law School, Lansing, Michigan. He finished Cum Laude and in the Top 20 Percent of his class.

Adam’s contact information will be as follows:

Office: 423-764-4127

As you have time, please welcome Adam to our professional firm.

Jobs With The Most Overtime Violations

As SESCO has reported many times before, overtime violations and non-compliance with the Fair Labor Standards Act (Wage and Hour) continues to be the number one financial liability for employers. While many of the overtime violations are due to non-compliant employment practices utilized by employers, most Wage and Hour violations occur with specific job titles wherein the position has been classified as exempt by the employer and, in fact, is nonexempt as determined by the Wage-Hour Division, thus due overtime for hours worked in excess of 40 hours per week.

With this in mind, the following are the most cited positions by the Wage-Hour Division:

Assistant Managers or Associate Managers- Most of the time, these managers do not perform the required managerial work as defined by Wage and Hour nor have the authority or independent discretion and judgment as required.

Truck Drivers/Delivery Drivers- Due to the repeal of the Motor Carrier Act (overtime exemption), truck drivers, unless employed by a carrier for-hire such as FedEx, land/air, etc., are due overtime for hours worked in excess of 40 hours per week. Thus, soft drink and beer distributors, local delivery drivers and others who are performing driving duties in a company-owned vehicle are subject to time and one-half (150%) for hours worked in excess of 40 hours per week.

Many times, manufacturing employees are required to work before their shift starts or after their shift which is considered hours worked.

Loan Officers, Mortgage Brokers, Financial Analysts

Nurses (LPN’s), Home Health Aides and Healthcare Workers- Many times these positions do not meet the Learned Professional Employee Exemption.


Call Center Workers/Customer Service Representatives

Inside Sales Representatives- To be exempt as a sales representative, the position must be performing outside sales duties for a majority of their work cycle. Inside sales representatives are not considered exempt as salespersons.

Computer Technicians, IT Workers, Network Administrators- These positions normally do not meet the Computer or Administrative Exemption Classifications.

It behooves all employers to conduct a thorough assessment of their compensation practices to determine compliance with the Fair Labor Standards Act. Compliance is attainable and affordable as there are a number of optional compliant pay plans and practices that employers can implement. SESCO retainer clients receive annual human resource management compliance assessments.

Frequently Asked Wage and Hour Questions

1. Does an employer have to give an employee rest breaks and meal periods? The federal regulations do not require rest or meal breaks. However, many states have adopted rest and meal break laws and as such, you need to check your state.

2. Is there a restriction on how many hours an employer can work an adult employee?
No — the federal law allows an employer to work the employee as long as they want. The employer only has to make sure that the employee is paid at least minimum wage (or the promised wages) and overtime.

3. Can an employer pay someone a salary and not have to worry about overtime pay? No. If an employee is exempt from the overtime regulations, then the answer is yes. However, just putting an employee on a salary does not necessarily mean that employee/position is not due overtime pay.

4. I am an hourly employee and I am paid every two (2) weeks. Does my employer figure my overtime pay after 80 hours? No, overtime is based on each individual workweek (a workweek is a 7-day consecutive period as defined by the employer).

5. Does a part-time employee have to be paid overtime? Yes — any employee who works over 40 is due overtime.

6. Can my employer require that I work overtime? Yes, the employer can require that you work overtime even if it was not scheduled.

7. Can I give comp time to my employees instead of paying them time and one-half (150%) overtime pay? No. A business in the private sector cannot give comp time in lieu of overtime. However, in the public sector this practice is allowed.

8. Do the hours that I am paid while I’m out on a holiday or vacation have to be counted when my employer figures overtime pay? No — only actual hours worked are counted when figuring total hours for overtime purposes. Thus, an employee can work 40 hours plus one (1) 8-hour holiday and be paid 48 hours at straight time.

9. Does my employer have to pay me time and one-half (150%) if I work on a holiday or on the weekend?
No, from a federal law standpoint. However, some states require premium pay for holidays and weekends.

10. What are the legal holidays that my employer has to observe?
None — there is no such thing as required legal holidays that employers have to observe.

11. Can an employer pay its employees by direct deposit and make this a condition of employment?
Yes, on a federal basis. However, check your state as state laws vary.

12. When I separate from a job does my employer have to pay me within 24 hours?
No, from a federal standpoint. However, check your state laws as states vary regarding final paychecks.

13. Does an employer have to give its employees vacation time off with pay?
No – vacation is a wage benefit which is provided at the discretion of the employer.

14. I am an hourly-paid employee, does my employer have to pay me for jury duty? No, from a federal Wage and Hour standpoint. Check your state laws as state laws vary regarding jury duty pay.

15. Can my employer require me to take a drug test?
Yes – an employer can require than an applicant or an employee submit to a drug test as a condition of hiring or of continued employment within established policy.

There is a significant amount of misunderstanding and misconceptions within federal Wage and Hour guidelines regarding pay, overtime and fringe benefits. Education and training of managers and employees alike will help reduce internal questions/morale issues as well as potential complaints to a federal or state Department of Labor office.

Special Thanks to SESCO Clients!

Bannan Funeral Home
Alpena, MI

Bankers Insurance, LLC
Glen Allen, VA

Allied Dispatch Solutions
Johnson City, TN

Webster Shipping/I Deliver
Ponca City, OK

Automotive Training Institute
Linthicum, MD

First Kingsport Credit Union
Kingsport, TN

Virginia Automobile Dealers Association
Richmond, VA

Marshall, VA

SESCO Client Feedback

“The harassment training provided clear communication to our staff on what is appropriate and expected of them. I liked Bill’s attitude and style. My overall opinion of SESCO is they are professional.” ~ Matthew Volmers — Don Beyer Volvo-Volkswagen


Your organization’s odds of being trageted for an I-9 audit have skyrocketed in the past few years. Additionally, the federal government has released a brand new version of the I-9 form with new requirements.

Total fines issued by ICE are now 13 times higher than in 2009. Additionally, ICE has made a big effort to publicly emphasize its criminal investigations of employers that hire undocumented workers. In just one (1) year, ICE has arrested 238 corporate executives, managers and even HR professionals.

Employers need to conduct internal audits or have SESCO conduct an I-9 audit to ensure compliance as non-compliance can be extremely expensive in both time and defense and fines.

10 Common Phrases That Supervisors Use That Turn Employees Against Them

“That’s above my pay grade.” You have essentially told an employee that you not only can’t solve his or her problem, but you are also afraid to go to bat for that employee by going to someone else in the organization to find a solution.

“Hold that thought.” This basically tells the employee that “I’m not interested in what you’re about to say” or “I do not have time for you.”

“Because we pay your salary.” Such a statement is usually uttered by a boss who either can’t articulate a good reason for issuing an assignment or is simply incompetent.

“I’m really busy right now.” Employees are your most valued asset — they don’t deserve a quick brush off — if you are busy, schedule a time to follow-up.

“I need it done yesterday.” This cliche is demeaning to the employee who is seeking a serious, meaningful deadline. If something is urgent, say so with a brief explanation why and ask the employee if there is anything they can do to help him or her achieve their goal.

“Great job.” This is fine if it is sincere and used sparingly when it is really warranted. Overuse dilutes its effectiveness and becomes meaningless to the employees.

“I only took ___ days off last year.” A boss who says this is either inviting everyone to pity him or her, or is trying to elevate his or her own work ethic above his or her employees. Either way, employees don’t want to hear about a manager’s woes, especially if you are not willing to listen to them.

“Why did this mistake happen?”
This question works if it is directed squarely at the system, not the people in it. Otherwise, it could look like you are seeking out a scapegoat.

“I don’t believe in giving employees a perfect review.”
This performance review downer is a great way to convey that there is no point in truly excelling. It’s a misguided motivational technique that will only serve to champion mediocre behavior.

“Let me know if you need help.”
Again, in itself, these words are just fine — even commendable. But tone is everything. When they are just empty verbal words, they essentially mean, “Good luck — don’t bother me.”

SESCO specializes in developing and training managers through a number of proven training systems and seminars, many of which are available for purchase for in-house use. Contact SESCO to receive a training catalog and Training Needs Assessment for use in internal training needs development.