Ask the Attorney: W-4 form errors and faulty FMLA
We asked our expert lawyer to answers a few HR professionals’ employment law questions.
Nancy Delogu is a Washington, D.C.-based attorney with Littler Mendelson, the nation’s largest employment law firm. Nancy has extensive experience defending employers in employment disputes before federal and state courts on a variety of workplace issues, including harassment, discrimination, overtime, privacy and disability issues.
Are we on the hook for this error on an employee’s W-4 form?
Q: “We have an employee who is very upset because her W-4 form had been filled out incorrectly, claiming three dependents when she actually has none. The employee is claiming that the HR specialist (who is no longer working for us) filled out this information (and it does look like her handwriting). This employee has now resigned because she is so upset and I’m worried about where we stand legally regarding this?” – Anonymous, Pennsylvania
A: This is troubling. IRS form W-4 is supposed to be completed by the employee in question, not the employer. As a result of the error, I’m sure she is concerned about coming up with the additional taxes which will be due and owing this April. There is even some chance that the IRS would send you (or her subsequent employer) a “lock-in” letter requiring additional deductions in coming years.
That said, the employee must have reviewed and signed the document—right? I doubt there will be much legal consequence to your company assuming that she had the opportunity to review and correct the form and instead simply signed it. If you suspect actual fraud by the former HR specialist, you may want to consult with your local U.S. Attorneys’ office. You could offer to “gross up” her wages to cover some of the funds which should have been withheld, but if she has already resigned, I doubt that will be an attractive option.
What happens if we give faulty FMLA notice?
Q: “An employee went out on qualified FMLA leave. A letter was sent to her. Unfortunately, it was a form letter that indicated that she was eligible for workers’ comp, but it was not workers’ comp leave. I just realized the mistake. How do I correct it?” – Kim, Virginia
A: I can’t tell from your note whether the original notice met all the FMLA notice requirements. If not, you should reissue the notice as soon as possible, with all the correct information.
Although the Supreme Court ruled in the Ragsdale case that individuals who received “bad” notice of their right to FMLA leave were not thereby entitled to more leave in total than the FMLA provides – i.e., 12 weeks away from work in a 12-month period – you could find yourself in a situation in which someone tried to return to work sooner than necessary or who was unaware of other rights provided by the FMLA and was harmed by the error. Technical violations of the FMLA can be actionable at law, as a recent suit filed by the U.S. Department of Labor illustrates.
If the only incorrect thing about the notice is that it stated that she was eligible for workers’ compensation benefits, but her need for medical leave was did not arise from a work-related accident, my advice is still to correct the error promptly, acknowledging that the notice that was sent was incorrect. It seems unlikely that she will have suffered any harm because of the error.
How do we count employees for Minnesota’s Parental Leave Law?
Q: “Regarding Minnesota’s Parental Leave Law, it is stated that:
‘Companies with 21 to 49 employees are covered by Minnesota’s Parental Leave Law. Companies with 50 or more employees are covered by the U.S. Family and Medical Leave Act.’
We have several part-time employees, some who work 15 hours a week or less. If all employees are counted, we are over 21. My question is: Do we count actual employees or FTE’s? Does 21 mean an equivalent of 21 full-time employees or 21 employees, no matter how many hours they work in a week?” – Carol, Minnesota
A: As you note, Minnesota’s Parental Leave Act applies to employers that employ 21 or more employees on at least one site. Importantly, the site is not required to be in Minnesota. The same is true for the state’s Sick Leave Benefits and Care of Relatives laws.
The statute provides the answer you’re looking for: “Employee” means a person who performs services for hire for an employer from whom a leave is requested for: (1) at least 12 months preceding the request; and (2) for an average number of hours per week equal to one-half the full-time equivalent position in the employee’s job classification as defined by the employer’s personnel policies or practices or pursuant to the provisions of a collective bargaining agreement, during the 12-month period immediately preceding the leave. Employee includes all individuals employed at any site owned or operated by the employer but does not include an independent contractor. Minn. Stat. 181.940 Subd. 2.
So, if your definition of full-time employee means an employee who works at least 30 hours a week, as is frequently true in respect to benefits policies, anyone who worked an average of 15 hours a week for a 12-month period would count toward the 21-employee coverage. Those who worked fewer hours would not count toward the coverage threshold. As you approach the threshold for coverage, you should track this carefully and err on the side of caution. Of course, if you have another location outside of Minnesota, you may find you are already covered.