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June 2002
“The Management Report”

In an ever-changing business world, it is important to maintain a source of factual information on a timely basis. The Employers Association is a not-for-profit Charlotte organization that serves as a unique source for human resources and training services targeted to keeping area member business owners, managers and executives abreast of current developments and concerns in the human resources arena.

            Founded in 1958, the Association maintains a broad-based membership of over 700 companies from all industries in the greater Charlotte region. As a member-driven organization, it strives to "Build a Better Business Climate" by providing services to management that help companies create and maintain positive and productive employer/employee relationships.

            The Employers Association is one of over 70 non-profit HR associations around the country providing HR services to their regional memberships, and through the Employer Association Group (EAG), sharing information with the other members of the EAG. Members of the Association who need national data from different geographical areas have this access through reciprocity arrangements with these other organizations. The EAG, under the auspices of the National Association of Manufacturers (NAM), has its offices in Washington, D.C., and monitors closely the actions of the federal government on matters affecting employers.  It generally makes survey information available to EAG members for no cost or low cost in exchange for member participation in the surveys.

            The Employers Association offers its members various services including: a monthly newsletter, The Management Report, informing members on new legislation and trends affecting human resources, a comprehensive Web site, , management and computer training, and a human resources advice hotline.  In particular, The Employers Association, conducts the most comprehensive local benchmark surveys in the region for wages, salaries, policies, practices and benefits.

            Below is a selection of items from their most recent online reports as well as their 2001 Benefits Survey:

• NC Unemployment Tax Rate Likely to Double. On March 8, Congress approved $8 billion in funds to bolster lagging state unemployment trust funds. Although North Carolina received $247 million in federal assistance, it probably won’t be enough to prevent the state unemployment tax rate imposed on employers from doubling next year. The federal money raised the balance of the state fund to approximately $609 million. State law requires the tax rate be doubled if the trust fund falls below $800 million on August 1 of any year.

            North Carolina paid out a record $136 million in January 2002. As the state continues to struggle with the loss of jobs, particularly in manufacturing and textile industries, the fund is not likely to reach the $800 million threshold by August 2002.

            Today, the tax rate paid by North Carolina employers is 1.2 percent of the first $15,500 in wages paid to an employee. The impact of the potential rate increase to 2.4 percent for an employer with 10 employees earning at least the base amount is a tax payment of $3,720 instead of $1,860. In addition to the financial costs for current employers, the increase may also have a negative impact on the state’s ability to compete for new industry and jobs at a time when the need for additional employers is critical. [The Charlotte Observer]

• Can Employees Collect Unemployment? Member companies that require a mandatory temporary shutdown week may wonder whether or not employees would be eligible to collect unemployment during this time. Many organizations in textiles and related industries have made it a regular practice to shut down their operation the weeks of July 4th and December 25th. The North Carolina Employment SecurityAct permits employers to designate up to two weeks per calendar year as vacation weeks. The Employment Security Commission does not consider employees as "available for work" during these periods. Thus the employees are not eligible to collect unemployment, even if the vacation period is without pay. Employers must give employees reasonable notice and specify the shutdowns as vacation weeks.

  Vacation Shutdowns. South Carolina employers should be aware that vacation shutdowns may be treated differently by the South Carolina Employment Security Commission. Employers that schedule shut downs should clearly communicate their policy to employees in writing. (

  Youth Employment and Driving Restrictions. Employers considering hiring young employees for summer jobs need to be aware of federal restrictions on teenage driving while on the job. Sixteen-year-old employees are now completely prohibited from driving on public roads while working. Seventeen-year-olds may only drive under specific conditions. The Teen Drive for Employment Act amended the child labor provisions of the Fair Labor Standards Act (FLSA) and became effective October 31, 1998.

            The regulations provide several guidelines for seventeen-year-old drivers. They require that driving be only occasional and incidental to the job. This means no more than one-third of the youth’s work time in any workday and no more than 20 percent of the youth’s work time in any workweek may be spent driving. They may only take two trips away from the job site in a single day to deliver goods and no more than two trips per day to transport passengers other than employees.

            The Department of Labor has published information to help employers make sure teens work safely. For more details, see the Department of Labor web site at HR Manager’s Legal Reporter).

            Other topics that may be of interest in the online reports include:• Will you be ready when a friendly Occupational Safety & Health Administration (OSHA) inspector knocks on your door?

• Bipolar Disorder is a physical illness, court rules, forcing companies to take a hard look at the mental illness vs. physical illness provisions in their medical plans.

• Employers of younger people for summer jobs are also subject to state employment laws. NC/SC Youth Employment laws regulate youth employment and especially hours of work. 


The above information was provided by The Employers Association. For more information regarding these laws and regulations call Laura Hampton at The Employers Association at 704-522-8011.

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