Topic: Human Resources
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Can our Agricultural Loan Officer qualify as an exempt employee based on his professional duties? He is part of the loan committee that votes on loans, as well as the executive committee (he is an executive officer of the bank). He is second in command at his location, under the senior vice president. His salary is over the $47,476 threshold.
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Yes, we believe the agricultural loan officer may be exempt from minimum wage and overtime requirements based on his specific job duties. In general, the Fair Labor Standards Act (FLSA) and the Department of Labor (DOL) regulations will exempt an employee whose compensation exceeds the threshold salary and who also has the duties of an…
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Can a bank require its employees to establish an account at the bank? I know this is prohibited for payroll purposes.
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We are not aware of any laws that prohibit your bank from requiring employees to establish an account, but we recommend that you consult with bank counsel before implementing such a requirement. As you point out, there are payroll deposit restrictions in state and federal law. Illinois law prohibits employers from designating a particular bank…
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We currently offer each employee seven sick days to use for their own personal illness or injury. We also offer seven personal days and two weeks’ vacation that employees may use for the illness or injury of family members. Under the new Illinois Employee Sick Leave Act, do we need to amend our current policy of requiring that sick days are for employee illness only?
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No, you do not need to modify your current policy of requiring that employees use their sick days only for their own illness or injury. Under the Illinois Employee Sick Leave Act, effective January 1, 2017, an employee may use their sick leave for the illness, injury or medical appointments of close relatives. However, an…
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Can you clarify whether we can pay referral fees for mortgages to our own employees? Are there any other requirements or caps?
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Yes, you may pay mortgage referral fees to bank employees who refer mortgage business to your bank. RESPA prohibits most referral fees related to mortgages, but that prohibition does not apply when compensating bank employees for mortgage referrals. Any referral fees paid to bank employees who are loan originators for referrals also must comply with…
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Are we required to maintain an Affirmative Action Plan (AAP) if we no longer sell savings bonds? We do redeem savings bonds.
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Yes, the AAP requirements apply to your bank. The AAP requirements apply to banks with more than fifty employees that either issue or redeem U.S. bonds or hold U.S. government deposits. While your institution no longer sells savings bonds, its redemption activities do trigger the AAP requirements (assuming that your bank still has more than…
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What are the retention periods for current employees’ insurance enrollment forms? What about forms for employees whom we have terminated? What is the retention period for information on a previous insurance provider after switching providers?
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We are not aware of any retention requirements for health insurance enrollment forms. We recommend retaining them at least until an employee’s employment with your bank has terminated. After switching insurance providers, you should retain the insurance plan and related information for at least one year after the plan’s termination date. The Age Discrimination in…
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We have two tellers who are separately compensated for cleaning duties at the bank. If we combine their teller and cleaning duties, their hours exceed 40 per week. Would that require overtime pay?
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Yes, those employees almost certainly would be considered to be non-exempt and therefore entitled to be paid overtime when working more than forty hours per week. The fact that the employees perform different duties at different times is not relevant when calculating the total number of hours worked per week. If the employees’ hourly rates…
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Our bank counsel advised us that the Illinois Wage Payment and Collection Act requires employers to maintain time records for all employees, even for salaried employees. Do we really need to require salaried employees to clock in and out?
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No, with the following caveat, we do not believe that Illinois employers need to require their salaried exempt employees to maintain time records, notwithstanding apparent language to the contrary in the Illinois Department of Labor (IDOL) rules. However, not having your exempt employees record their daily time can involve some risk if a salaried non-exempt…
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We are working on our policies and procedures on suspected criminal behavior by our employees and officers, which include terminating employment and notifying law enforcement. Are we required to formally report incidents of theft or embezzlement by a bank employee or officer to the FDIC?
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Yes, we recommend reporting incidents of employee or officer crimes to your primary regulators (in your case, the IDFPR and the FDIC), although this is not always strictly required. The FDIC’s SAR rules require banks to report “violations requiring immediate attention, such as when a reportable violation is ongoing” to its FDIC regional office. Even…
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We pay two employees commissions for the mortgage products that they sell. If we pay commissions for sales of closed-end mortgages, are we also required to pay the same commission for sales of home equity lines of credit (HELOCs)? Would the commission structures have to be identical?
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We do not recommend compensating sales of HELOCs differently than sales of closed-end mortgage loans, due to Regulation Z’s prohibition on compensating a loan originator “based on a term of a transaction.” Regulation Z’s restrictions on loan originator compensation do not apply to HELOCs, but they do apply to closed-end mortgage loans secured by a…