How to Tackle the Top Five Health Care Employment Law Issues in 2024

As the health care industry continues to shift, upticks in workplace violence, whistleblower lawsuits, and changing regulations could bring mounting costs and liabilities for employers. These tips can help health care employers mitigate risks and put plans in place to address potential issues.

1. Workplace violence

A 2023 Journal of Emergency Nursing study showed that in the emergency department, 90% of nurses are exposed to violence and more than 94% have experienced some form of verbal abuse. Serious workplace violence is four times more common in health care than in other industries, according to the Occupational Safety and Health Administration (OSHA).

These incidents include violence fueled by criminal intent and violence stemming from issues between co-workers. Apart from the interpersonal issues these acts create, it is also estimated that they cost hospitals $453 million per year due to employees' absence from work. These acts can also expose employers to liability under OSHA's Guidelines for Preventing Workplace Violence for Healthcare and Social Service Workers and some state's health care workplace violence standards, including a new Texas law requiring workplace violence plans for health care workers.

How can employers prevent these issues?

• Create a zero-tolerance policy and a workplace violence prevention plan. These written policies and plans should cover workers, patients, clients, visitors, contractors, and even third-party organizations.
• Consider risks within the organization that could lead to or allow for violent acts to occur. Risks could include environmental factors such as employees' lines of sight from their workplace, the placement and storage of hazardous materials, recurring negative behaviors from staff, and security measures (or lack thereof) like entry codes, alarm systems, and video monitoring.
• Conduct regular, mandatory training for staff and explicitly lay out how violent acts can be reported and how they will be investigated.

2. Internal reports of wrongdoing and whistleblowing

Since the pandemic, the health care industry has seen an increase in safety-related whistleblower complaints under Section 11(c) of the Occupational Safety and Health Act. The Act bars employers from firing or discriminating against an employee in retaliation for filing a safety complaint or participating in an OSHA-related proceeding. Whistleblowers are also increasingly reporting fraud or false claims in federal health care programs under the False Claims Act and reporting financial wrongdoings by health care employers under the Sarbanes–Oxley Act. And, like any employer, health care employers are also subject to potential complaints of unlawful workplace discrimination or harassment.   

A robust, thorough, and effective compliance program is a must for health care employers to address these issues and best protect themselves from potential liability. Employers should implement and disseminate the company's formal complaint process to their staff and train all staff on the process. That written process should include its own anti-retaliation provisions and offer alternative avenues for employees to make a complaint, including outside of an employee’s own supervisory hierarchy.

The complaint process should also include a detailed and written plan for investigating complaints and a proactive feedback loop where employees and leadership can share insights to improve company operations. Supervisors should be trained to take every complaint seriously and not to retaliate against employees who report complaints. Employers should thoroughly investigate each complaint, confidentially on a need-to-know basis, and, if appropriate, implement remedial measures and provide a post-investigation report to the complaining employee.

Finally, where possible, health care companies should conduct exit interviews of departing employees to provide employees an opportunity to voice their opinions and complaints they may not have previously disclosed.

3. Negligent hiring, training, and retention

Negligent hiring, training, and retention claims are based on the allegations that the employer knew or should have known of an employee's qualifications, failed to adequately train the employee, or retained the employee even after learning of the employee’s unsuitable qualifications or misconduct, potentially making the employer liable for the harm done by the employee. These claims can be factually intensive, making lawsuits involving them difficult to dismiss before trial.

A bad hire also can cost companies thousands of dollars in wasted training costs and often results in negative attitudes among staff, loss of production, and loss of recruitment time. To get in front of these issues, health care employers should implement credential verification processes, career history and disciplinary investigation policies, reference checks and comprehensive background checks for all hires, while complying with all state and federal laws applicable to those processes (including the Fair Credit Reporting Act). It is also important to question any gaps in a prospective hire’s prior employment.

After an employee is hired, the employer should thoroughly document all complaints and conduct regular performance reviews to monitor whether the employee's performance aligns with company requirements and expectations. When appropriate, after hiring, an employer should use documented, progressive discipline of underperforming employees to separate those who are not a suitable fit for the employer’s workplace. Ignoring employee performance or misconduct issues usually does not result in a better performing employee and can lead to larger issues if left unaddressed.  

4. New workplace discrimination and accommodation laws

Health care employers face added risks for some types of workplace discrimination claims. Employers should stay up to date with the following evolving laws, among others:

• The PUMP for Nursing Mothers Act, which provides expanded protections for nonexempt employees under the Fair Labor Standards Act (FLSA) for up to one year after childbirth
• The Pregnant Workers Fairness Act, which recently helped close the gap between the Pregnancy Discrimination Act and the Americans with Disabilities Act
• The U.S. Supreme Court’s decision in Groff v. Dejoy, which set the standard for determining undue burden for requested religious accommodations
• State and local laws with additional protected classifications, including hairstyle and hair texture, criminal background and caste
• Artificial intelligence policies
• State and local pay equity laws
• Reasonable accommodations under the Americans with Disabilities Act

5. Wage and hour issues

The FLSA requires health care employers to pay all employees at least the federal minimum wage for all hours worked and “non-exempt” employees overtime pay for hours worked over 40 in a workweek. The U.S. Department of Labor (DOL) has kept a close eye on the health care industry in recent years, considering it a “high violation industry” for wage and hour issues.

One of the biggest wage and hour issues, and an area for potential liability, in the health care industry is the misclassification of employees as exempt versus nonexempt or employee versus independent contractor. Health care employers should carefully review recent actions by federal agencies on these subjects to ensure compliance.

For example, employees who meet the job duties test to qualify as overtime exempt, such as executive, administrative, professional, and computer employees, currently must also earn a minimum salary to qualify for the exemption. That salary minimum previously had been at least $684 per week ($35,568 annually). On April 23, 2024, however, the DOL announced an increase to the minimum salary for these exemptions to $844 per week ($43,888 annually), effective July 1, 2024, and $1,128 per week ($58,656 annually), effective Jan. 1, 2025. The new rule also provides for a procedure to increase the salary minimum every three years thereafter. The rule will be subject to legal challenges. But unless and until there is a definitive ruling striking down or delaying the new rule, employers must review their exempt employees currently earning less than the new minimum and decide whether to increase their salary to maintain the exemption or change the employee’s classification to non-exempt and then track and manage their work hours for overtime pay. 

Health care employers should also be aware of the DOL’s new rule for determining whether a worker is an employee or independent contractor, which took effect in March, that should result in more workers being labeled as employees. Proper classification of workers in this context is central to determining if the worker is entitled to protections under the FLSA, the employer’s obligations to the worker under the FLSA, and the employer’s obligation, if any, for withholding payroll taxes.

Employers should closely and regularly assess each employee’s job duties and requirements to ensure they are fulfilling minimum wage and overtime requirements for FLSA-covered employees. Employers also should be mindful to include all work time performed by non-exempt employees, such as travel time for the employer, training, and after-hours calls, emails, or texts, to ensure that employees are properly compensated for overtime work. Employers must also be aware of any state-to-state and city-to-city distinctions for minimum wage, expense reimbursements, and day-of-rest requirements to maintain FLSA compliance.

Please contact Brie Zarzour, Michael E. Turner or any member of Phelps' Health Care or Labor and Employment teams if you have questions or need advice or guidance.