You’ve done the hard part (or so you thought): You’ve come up with a business idea, developed a plan, and raised the money to get your new company off the ground. However, one of your next tasks, responsibly growing and managing your workforce, will present a set of different challenges. Whether you have five, 50, or hundreds of employees, business owners must take care to properly (and legally) take care of their workers (and that’s before considering the issues presented by COVID-19).

1. MANAGING YOUR
EMPLOYEES
January 19th, 2021
What New and Small Businesses Need to Know

2. Today's Agenda
Partnership
Prince George's County Economic Development Corporation Overview
Introduction of Speaker
Lerch, Early, and Brewer, Chtd. Overview
Managing Your Employees
Disclaimer
Contact Us
2

3. ABOUT THIS EVENT SERIES
The goal of these events is to focus on a topic
relevant to emerging and small businesses
emphasizing the legal requirements of doing
business in Prince George's County and in
Maryland. Each workshop will feature a Lerch
Early attorney and provide the opportunity for
interaction/Q&A.
This is the third in a series of online events co-presented
by Lerch, Early & Brewer and the Innovation Station
Business Incubator Powered by the Prince George's
County Economic Development Corporation.
Partnership
3

4. Alicia Moran
Small Business Manager
Prince George's County Economic
Development Corporation
CONTACT
Amoran@co.pg.md.us
4

5. SMALL BUSINESS SERVICES
• Business Development Trainings & Workshops
• Access to Financing
• Connections with resource partners
⚬ SCORE, SBDC, PTAC, MWBC, TEDCO, MIPS, etc
• Innovation Station - virtual, office and co-working
memberships
• Connections to other incubators, accelerators and
innovation hubs
• Site selection/Permit assistance
• Connections to international and industry expertise
• Coaching, counseling and other assistance

6. 6

7. Innovation Station
Business Incubator
Fosters:
Startup & Existing
Companies
Job Creation
Business
Retention
Business Attraction
The County's Economic
Development Mission
Business Expansion
7

8. EMERGE STRONGER
Emerge Stronger Business
Recovery (ESBR) was created as a
solution to the overwhelming
technical assistance needs of
Prince George’s County Business
Recovery Initiative (BRI)
applicants. While immediate
COVID-19 relief funding is critical
to maintain small business
operations, technical assistance is
vital to improve short-term
recovery odds and post-pandemic
resilience.
ADDITIONAL RESOURCES & PROGRAMS
BUY PRINCE
GEORGE'S
BUY PRINCE GEORGE’S is a
movement started in response to
the COVID-19 pandemic supporting
our residents by keeping them
home, and supporting our
businesses by connecting them
with County residents shopping for
goods and services and wanting to
support the local economy. But
shouldn’t we always buy local?
TAKE OUT TUESDAY
Calling all County foodies and
beyond! Coming to a screen near
you is the Prince George's County
Economic Development
Corporation's newest signature
program Take Out Tuesday!
PGCEDC is committed to
promoting its businesses in every
way we can. So join us in our
newest business spotlight series
as we explore all there is to eat in
the County and where you
can #BuyPrinceGeorges!
CREANDO EXITOS
Spanish Language Business
show with host Rocio Treminio -
Lopez.
To connect Spanish speaking
County Businesses with
information and resources to
thrive
8

9. The Restaurant Resiliency Fund will provide
grants up to $25,000 to Prince George’s County-
based restaurants and food establishments to
promote long-term sustainability and resiliency of
businesses operations, support COVID-19 safety
measures, and support businesses operating at
reduced capacity.
Restaurant Resiliency Fund
Application Deadline: January 22, 2021 | 5pm
Grants: Up to $25,000
Use of Funds: Businesses may receive a grant up to $25,000 to
support COVID-related costs including personal protection
equipment (PPE), winterization for outdoor seating, interior
improvements to support social distancing, expenses to create or
expand takeout/ carryout and/or delivery services, marketing, and
operating expenses (rent, payroll, inventory, insurance, utilities).
9

10. CURRENT FEDERAL
COVID RESOURCES
10
Provides loans that helps businesses keep their
workforce employed during the Coronavirus
(COVID-19) crisis. Eligible business may apply a
second time and there is also loan forgiveness for
retaining employees by temporarily expanding
the traditional SBA 7(a) loan program.
• First Draw Loans
⚬ An SBA loan that helps businesses keep
their workforce employed during the
Coronavirus (COVID-19) crisis.
• Second Draw Loans
⚬ Eligible businesses may apply for a Second
Draw PPP loan.
• PPP Loan Forgiveness
⚬ Borrowers may be eligible for loan
forgiveness.
Paycheck Protection
Program
EIDL Advance Grant 2.0
Eligible small businesses are able to receive additional
funding if their first EIDL Advance Grant was under
$10,000. Businesses are eligible to receive an EIDL
Advance Grant if they:
• Employ 300 employees or less
• Demonstrate at least a 30% reduction in gross receipts
in any 8-week period between March 2, 2020 and
December 31, 2021.
• Are located in a low-income community such as
defined for the New Markets Tax Credit (NMTC)

11. ABOUT THE PRESENTERS
Michael Neary is an employment attorney and commercial
litigator who works with businesses to prevent and defend
against employee claims. He also litigates commercial
disputes such as real estate controversies, business fraud,
corporate and partnership dissolutions, and commercial
contract claims.
Michael J. Neary
Employment Attorney
Lerch, Early & Brewer
301-657-0740
mjneary@lerchearly.com
Nida Kanwal is an employment attorney who represents
management in workplace employment matters. Prior to
joining Lerch Early, she was a judicial clerk to The
Honorable Clayton Greene, Jr. of the Court of Appeals of
Maryland.
Nida Kanwal
Employment Attorney
Lerch, Early & Brewer
301-657-0744
nkanwal@lerchearly.com
11

12. What we’ll
discuss today
1. Hiring Process and Accompanying Risks
2. Registering Employees With the State
3. Immigration Compliance
4. Documenting Employment Relationship: Offer
Letters, Contracts, Equity Grants
5. Best Practices for Employer Policies
6. Wage and Hour Issues – Employee/Independent
Contractors
7. Protecting Your Intellectual Property and Trade
Secrets
8. Workplace Health and Safety – COVID-19
9. Insurance
10. Benefits
13

13. Risks in the
Hiring and
Interview Process
EMPLOYERS, INCLUDING
STARTUPS, FACE
POTENTIAL LIABILITY RISKS
IN THE HIRING PROCESS.
Discrimination in
the Hiring
Process
MANY ASPECTS OF THE
RECRUITING PROCESS MAY
TRIGGER AN EMPLOYMENT
DISCRIMINATION CLAIM.
12

14. Salary History
Bans
While most employers would not
think that asking about an applicant's
past compensation is discriminatory,
in some jurisdictions these once-
routine questions are now unlawful
13

15. Criminal
Background
Checks
While employers may have good
reason to seek information about an
applicant's criminal history, inquiring
about or using this information may
create certain risks.
14

16. Social Media
Issues in
Hiring
Social media is integral to many
startups, and serves as a primary tool
for communication and
information-gathering by both
business owners and employees.
15

17. NEW HIRE FILING,
REPORTING, AND NOTICE
REQUIREMENTS
16

18. State
Reporting
Options
Child support obligations, state taxes,
workers‘ compensation, workers’
compensation, and unemployment
insurance (see Workers' Compensation
and Unemployment Insurance).
New Hire Filing, Reporting, and
Notice Requirements
17

19. IMMIGRATION ISSUES AND
FORM I-9 COMPLIANCE
18

20. Authorization
to work in the
United States • Authorization documents
• Foreign worker requirements
Immigration Issues and Form I-9 Compliance
19

21. FORMING AND
DOCUMENTING THE
EMPLOYMENT RELATIONSHIP
What are the terms of employment?
20

22. At-Will
Employment
Status
Presumed
Employers must decide whether each
employee is being hired on an at-will
or some other basis. The default rule
in Maryland is at-will employment.
21

23. Offer Letters
Startups hire most of their workers
without formal employment
contracts.
Some startups hire employees and
retain service providers such as
independent contractors without any
written documentation. Rate of pay,
pay days, exempt non-exempt
21

24. Employment
Contracts
Many startups and small businesses
use offer letters for all their employees.
Formal employment contracts, if used
at all, are generally reserved for more
senior executives and management
personnel.
22

25. SPECIAL CONSIDERATIONS
FOR FOUNDERS AND
MANAGEMENT EXECUTIVES
23

26. Set Reasonable
Salary
Expectations
Compensation decisions may have a
dramatic impact on a startup's ability
to attract investors and raise capital.
Special Considerations for Founders and
Management Executives
24

27. Determine
How to Share
the Equity
Many startups are co-founded by two
or more individuals. When dividing
ownership in the company, founders
should not automatically assume that
an equal split is the only or best
alternative.
Special Considerations for Founders and
Management Executives
24

28. Valuation
And
Vesting Issues
Fair market value of the shares using a
reasonable valuation method.
Special Considerations for Founders and
Management Executives
24

29. WORKPLACE
POLICIES AND PROCEDURES:
BEST PRACTICES
25

30. At-Will
Employment
Policy
• Employers reserve the right to terminate
employees at any time.
• Employees may resign at any time, with or
without notice or cause.
Workplace Policies and Procedures: Best
Practices
30

31. • Potential liability for discrimination claims
throughout every stage of the employment
relationship. protected classes under federal law,
including:
⚬ Race
⚬ Color
⚬ Religion
⚬ National origin
⚬ Citizenship
⚬ Sex, including gender, pregnancy, sexual
orientation and gender identity
⚬ Age
⚬ Physical or mental disability
⚬ Veteran status
⚬ Genetic information
• Evidence of the company’s commitment to anti-
discrimination
Equal Employment
and
Anti Discrimination
Laws and Policies
Workplace Policies and Procedures: Best
Practices
26

32. Anti-Harassment
and Anti-Retaliation
Policy
• Implement both a strong anti-
harassment and anti-retaliation
policy.
• Communicate the policies to all
employees.
• Train employees, particularly
supervisors, on the meaning and
impact of the policies.
Workplace Policies and Procedures: Best
Practices
27

33. Disability
and Religious
Accommodation
Policies
If an employee requests an
accommodation for a disability, an
employer must engage in an
interactive process with the individual
and provide a reasonable
accommodation to a qualified
individual unless doing so would cause
an undue hardship to the employer.
Workplace Policies and Procedures: Best
Practices
28

34. Sick Leave, Holiday,
Vacation, and Paid
Time Off Policies
• Sick and safe leave may be required
• Policies should clearly indicate the
amount of leave available, process
for requesting leave, notice required
by the employee, and if leave is paid
out at separation.
Workplace Policies and Procedures: Best
Practices
29

35. Family and
Medical Leave
• Up to 12 weeks in a 12-month period, but up to 26 weeks
of leave are available to care for a military family
member
• Purposes:
• The care of a child, including:
• birth of an employee's son or daughter; and
• placement of a son or daughter with the employee
for adoption or foster care.
• The care of a spouse, son, daughter, or parent with a
serious health condition.
• A personal serious health condition that prevents the
employee from performing essential job functions.
• A qualifying exigency arising out of the military service of
a spouse, son, daughter, or parent.
• The care of a military member with a serious injury or
illness.
Workplace Policies and Procedures: Best
Practices
29

36. Social Media,
Internet, Email
Monitoring, and
BYOD Policies
• Notice to employees that there is no expectation
of privacy in the use of their employer's email or
computer systems.
• Prohibit electronic communications for any
harassing, discriminatory, or retaliatory purpose.
• There are legal restrictions on chilling concerted
activity protected under the NLRA in both
unionized and nonunionized workplaces.
• Clearly define the limits of an employee's
expectation of privacy on their personal devices
used for work purposes.
• Prohibit off-the-clock email access and work by
nonexempt employees.
Workplace Policies and Procedures: Best
Practices
30

37. Code of Conduct,
Code of Ethics, and
Conflicts of Interest
Policy
Notifies employees about employer
expectations for acceptable workplace
activity.
Workplace Policies and Procedures: Best
Practices
31

38. Performance
Reviews and
Talent Management
• As a basis for employment
decisions, such as promotions and
demotions.
• To improve the performance of
underperforming employees.
• To document employee progress at
the company.
Workplace Policies and Procedures: Best
Practices
32

39. WAGE AND HOUR ISSUES
33

40. Administering
Payroll
• Who will administer payroll
• How much and in what manner
employees are to be paid
• Pay frequency and cycle
Wage and Hour Issues
34

41. Complying with
Minimum Wage
and
Overtime Laws
• All nonexempt employees must be
paid at least minimum wage and
overtime under all applicable laws
• Maryland minimum wage rate:
$11.75 for employers with 15 or more
employees and $11.00 for employers
with 14 or fewer employees
• Overtime: calculated at a rate of 1.5
times the employee's regular rate of
pay for all hours worked over 40
hours in a workweek
Wage and Hour Issues
35

42. Classifying Workers
as Exempt or
Nonexempt
The most common exemptions include
those for:
⚬ Administrative employees.
⚬ Executive employees.
⚬ Professional employees,
including learned professionals
and creative professionals.
⚬ Computer professionals.
⚬ Outside sales employees.
⚬ Highly compensated employees.
Wage and Hour Issues
36

43. Independent
Contractors and
the Risks of
Misclassification
• Improper classification of workers
as independent contractors can
result in steep penalties.
• A very challenging and
individualized analysis under
various tests.
Wage and Hour Issues
37

44. Improper Reliance
on Unpaid Interns
Factors to consider:
⚬ Whether the intern is receiving
academic credit.
⚬ Whether the intern is doing work
that otherwise would be performed
by employees, or the same as work
other employees are performing.
⚬ The degree of training provided to
the intern.
⚬ Whether the internship's duration is
finite.
⚬ Whether there is an expectation of
future employment.
Wage and Hour Issues
38

45. PROTECTING INTELLECTUAL
PROPERTY AND GOODWILL
39

46. Confidentiality
and Proprietary
Rights Agreements
An agreement to protect the employer’s
valuable confidential information and
intellectual property (IP) assets, including
trade secrets, from disclosure or misuse
by an employee.
Protecting Intellectual Property and Goodwill
40

47. Non-Compete
Agreements
An agreement that restricts a former
employee’s ability to work for an
employer's competitors for a specified
period of time after the employee’s
employment ends.
Protecting Intellectual Property and Goodwill
41

48. Non-Solicitation
Agreements
An agreement to prohibit an employee
(current, former, or both) from
approaching the employer's other
employees, clients, customers, vendors, or
business partners to attempt to hire,
retain, or create contractual relationships
with them.
Protecting Intellectual Property and Goodwill
42

49. WORKPLACE HEALTH
AND SAFETY
Startups traditionally have not focused on workplace
health and safety policies, as those issues are more
relevant in production or manufacturing plants and
other environments involving manual labor.
43

50. EMPLOYMENT-RELATED
INSURANCE REQUIREMENTS
44

51. Workers'
Compensation
Most employers are covered by workers'
compensation laws. Most states require
private employers with one or more
employees to carry workers'
compensation insurance.
Employment-Related Insurance Requirements
45

52. Unemployment
Insurance
Unemployment insurance provides
temporary income for eligible workers
who:
⚬ Become unemployed through no
fault of their own.
⚬ Are ready, willing, and able to work.
⚬ Have sufficient work and wages in
prior covered employment.
Employment-Related Insurance Requirements
46

53. Other Business
Insurance
• Commercial general liability (CGL)
insurance.
• Directors and officers (D&O) insurance.
• Employer practices liability insurance
(EPLI).
Employment-Related Insurance Requirements
47

54. EMPLOYEE BENEFITS AND
INCENTIVE COMPENSATION
48

55. Benefit Offerings
• A startup's benefit offerings may include:
• Traditional group health plan arrangements
(insured or self-funded), though these plans
are subject to an extensive set of
compliance obligations, for example:
• health plan continuation coverage
requirements under the Consolidated
Omnibus Budget Reconciliation Act of 1985
(COBRA)
• privacy, security, breach notification, and
related standards under the Health
Insurance Portability and Accountability Act
of 1996 (HIPAA)
Employee Benefits and Incentive Compensation
49

56. QUESTIONS
&
ANSWERS
50

57. This content is for your information only and is not
intended to constitute legal advice. Please consult your
attorney before acting on any information contained
here.
No individual or entity-including a presenting author-
may record or broadcast any portion of this presentation
without prior wrtten consent of Lerch, Early, and Brewer,
Chtd. Unathorized recoreding (audio, visual, still
photography, etc.) of presentations during sessions,
workshops, slide decks, or other presentation materials,
without the written consent of of Lerch, Early, and
Brewer, Chtd. and individual authors is striclty prohibited.
Thank You
DISCLAIMER
51

58. Thank You
Contact Us
ALICIA MORAN
SMALL BUSINESS MANAGER
PRINCE GEORGE'S COUNTY ECONOMIC
DEVELOPMENT CORPORATION
301-583-4604
Amoran@co.pg.md.us
NIDA KANWAL
EMPLOYMENT ATTORNEY
LERCH, EARLY & BREWER
301-657-0744
Nkanwal@lerchearly.com
MICHAEL J. NEARY
EMPLOYMENT ATTORNEY
LERCH, EARLY & BREWER
301-657-0740
Mjneary@lerchearly.com