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  • Federal Guidance, Human Resources Comments Off on SHRM Proposing new regulation on sick and paid leave

    SHRM is working with representative, Mimi Walters, CA, to propose a devised regulation that would meet all of the state and local mandated sick and paid leave that states are now drawing up. This regulation would allow:
    Employers that choose to participate by offering a minimum threshold of paid leave and a flexible work option to all employees will automatically satisfy all state and local requirements.

    Amends ERISA, providing participating employers flexibility and predictability in designing workplace flexibility offerings, rather than a patchwork of conflicting government mandates.

    The bill would amend ERISA by adding to the definition of an ERISA plan a “Qualified Flexible Work Arrangement Plan” (QFWA)
    1.Employer voluntarily chooses to offer a QFWA Plan to their employees
    To qualify as a QFWA Plan, employer would have to offer two major components to ALL employees:
    A. Paid Leave – the number of days would be scaled to the size of the employer and an eligible employee’s tenure with the employer
    B. Flexible Work Arrangement – the employer would offer at least one flexible work arrangement to each eligible employee

    Find below the Federally proposed regulations:
    1.Working Families Flexibility Act (S. 801/H.R.1180) – compensatory time accrues at a rate of 1½ times the employee’s regular rate of each hour worked over 40 hours.
    Allowing employees to accrue up to 160 hours of comp time

    Bills to mandate paid leave introduced in new Congress, but action unlikely

    2. Healthy Families Act (S.636/H.R. 1516) – Requires employers with 15 or more employees to provide up to 56 hours of paid sick leave

    3. FAMILY Act (S. 397/H.R. 947) – Creates a paid family leave insurance fund through a payroll tax to provide partial wage replacement for FMLA qualifying events.

    This is an important topic in Congress right now and by voting for the SHRM proposal, you are electing the ERISA safe harbor plan, which means you meet all state and local regulations. Please be on the lookout for the SHRM proposal and support it by voting for it. By having to adhere to each state’s and local’s laws, would be cumbersome and an administrative nightmare. But by voting for SHRM’s proposal, we would all be lending a hand to making one law to be followed.

  • Federal Guidance, Human Resources Comments Off on EEOC Issues Proposed Rule on EEO-1 Report

    On February 1, 2016, the Equal Employment Opportunity Commission (EEOC) released a proposed rule revising the Employer Information Report (EEO-1). The proposed revision would require all employers with more than 100 employees (including federal contractors) to submit compensation data to the EEOC beginning in 2017. According to the EEOC, the new data would be used to assist the agency in identifying possible pay discrimination and assist employers in promoting equal pay in their workplaces.

    Under current regulations, employers with more than 100 employees, and federal contractors or subcontractors with more than 50 employees, are required to collect and report information about employees’ race, ethnicity, and sex in each of 10 job categories. Under the proposed rule and beginning in September 2017, employers with more than 100 employees would also be required to report on Forms W-2 earnings and hours worked for all employees by race, ethnicity, and sex. Note that federal contractors and subcontractors with 50 to 99 employees would only be required to submit the current EEO-1 form without compensation data.

    Members of the public will have until April 1, 2016 to submit comments.

  • On December 18, 2015, President Obama signed into law the Consolidated Appropriations Act (H.R. 2029), which, among other things, delays the implementation of the Affordable Care Act (ACA) excise tax on high cost health plans (generally referred to as the Cadillac tax) until January 1, 2020. The act also makes the Cadillac tax a tax-deductible expense.

    The Cadillac tax, previously scheduled to go into effect on January 1, 2018, is a 40 percent excise tax on employers and insurers who offer health insurance plans that exceed specified high-cost limits ($10,200 for individual coverage and $27,500 for families for 2018). The 40 percent tax applies to the cost of the plan above these thresholds.

  • Federal Guidance, Human Resources Comments Off on ACA’s “Small Group” Expansion Rescinded

    On October 7, 2015, President Barack Obama signed the Protecting Affordable Care for Employees Act (PACE Act) into law. The PACE Act rescinds the Affordable Care Act’s expansion of small group health insurance policies from “up to 50 employees” to “up to 100 employees” that was scheduled to take effect January 1, 2016.

    This means that employers in the 51 – 100 employee size group may not be subject to small-group market rules, including requirements to provide essential health benefits defined by the Affordable Care Act (ACA) with less underwriting criteria. Currently the underwriting criteria covering small group plans includes age, geography, and smokers in the group and excludes claims experience and gender. The legislative intent of the PACE Act is to support small and mid-size businesses by limiting potential premium increases and give states the option to define their small group market size up to 100 employees.

    What this means for employers:

    States may choose to keep the federal standard (50 employees) as the definition of “small group” or legislate the small group market up to 100 employees.
    Insured group health plans for employers with 51 – 100 employees in states that have already passed laws defining “small group” for 2016 according to the ACA threshold of 100 employees may still be considered “small group” because the state law overrides the federal law.
    Employers with 51 – 100 employees in states that have not enacted any legislation defining group size will benefit from the PACE Act.
    Self-funded (insured) group health plans are not impacted by this law.
    Employers should work with their insurance brokers and carriers to understand the impact of the repeal of this ACA provision for small groups in each state where they offer group health insurance.

  • Federal Guidance, Human Resources Comments Off on Celebrating 25 Years of the American with Disabilities Act

    This year we celebrate 25 years since the inception of the ADA, or American with Disabilities Act. This landmark piece of legislation provides for no discrimination against handicapped or disabled people.

    People with disabilities need good jobs too. The Department of Labor has several agencies that can help people with disabilities find meaningful work and launch successful careers, help employers hire people with disabilities, and help federal contractors stay within the law when hiring.
    Office of Disability Employment Policy ODEP opens access to training, education, employment supports, assistive technology, and more.
    ODEP’s http://www.disability.gov offers social media tools and upgrades to complement the information from 22 federal agencies on disability-related programs and services.
    ODEP does not enforce any laws.

    Office of Federal Contract Compliance Programs OFCCP enforces Section 503 of the Rehabilitation Act Federal contractors and subcontractors with contracts of $10,000 or more must take affirmative action to employ and promote qualified people with disabilities.

    OFCCP has coordinating authority under Title I of the Americans with Disabilities Act ADA prohibits employers with 15 or more employees from discriminating against qualified individuals with disabilities.

    The Equal Employment Opportunity Commission has primary authority for enforcing the employment provisions of ADA. Most government contractors are covered by both Section 503 and the ADA.
    OFCCP enforces the Vietnam Era Veterans Readjustment Assistance Act, VEVRAA prohibits employment discrimination against certain categories of veterans by federal contractors. Some disabled veterans are covered under this law.

    Employment and Training Administration provides grant programs and other services to enhance the employment opportunities of people with disabilities.
    Civil Rights Center, part of Office of the Assistant Secretary for Administration and Management, enforces several federal disability nondiscrimination laws, including Sections 504 and 508 of the Rehabilitation Act of 1973, Section 188 of the Workforce Investment Act of 1998, and others. Section 504 imposes affirmative disability-related responsibilities on recipients of federal financial assistance as well as federal programs and activities and prohibits disability-based discrimination by those groups. The CRC enforces the law on groups that receive financial assistance from DOL.
    Section 508 requires that electronic and information technology be accessible to people with disabilities.
    Section 188 prohibits disability-based discrimination by programs and activities that are offered as part of the One-Stop service delivery system established by WIA Title I. Title II of the ADA contains similar provisions applicable to public employers; CRC is responsible for enforcing Title II with regard to “all programs, services, and regulatory activities” of organizations “relating to labor and the work force.”
    Executive Order: E.O. 11478 prohibits employment discrimination and requires affirmative action on various bases, including disability, by the federal government
    Executive Order: E.O. 13160 prohibits disability-based discrimination in education programs and activities conducted by executive departments and agencies.

    Reference: ADA.gov

  • Federal Guidance, Human Resources Comments Off on The US Supreme Court Rules that ACA Subsidies Are Available for Health Insurance Purchased on Federal Exchanges

    On June 25, 2015, the U.S. Supreme Court (the Court) released its decision in King v. Burwell, regarding whether the Affordable Care Act (ACA) permits the Internal Revenue Service (IRS) to provide tax credits for health insurance purchased through a federal Exchange (also referred to as the federal Health Insurance Marketplace). The Court held that tax credits for health insurance are available in states that have a federal Exchange. As a result of this ruling, subsidies will remain available for qualifying individuals regardless of whether they obtain coverage on a state or federal Exchange. The ACA remains the law and employers must continue to comply with applicable requirements.

    The ACA requires states to establish state Health Insurance Marketplaces (state Exchanges) through which qualified individuals and employers may purchase health insurance coverage. If a state cannot or will not establish a state Exchange, the ACA directs the Department of Health and Human Services (HHS) to “establish and operate such Exchange within the state.”

    The ACA also added language to the Internal Revenue Code (IRC) making health insurance premium tax credits available to individuals who purchase health insurance through Exchanges “established by the state.” On May 23, 2012, the IRS issued final regulations implementing the premium tax credit and interpreted the definition of Exchange to include both state Exchanges and federal Exchanges. As a result, individuals who purchase health insurance through either a state or federal Exchange are eligible for premium tax credits.

    Currently only sixteen states and the District of Columbia have established state Exchanges, while the remaining thirty-four states have some version of a federal Exchange.

    Supreme Court Decision
    On June 25, 2015, the Court held 6-3 that the ACA’s tax credits are available to individuals in states that have a federal Exchange. Chief Justice Roberts wrote the majority’s opinion joined by Justices Kennedy, Ginsburg, Breyer, Sotomayor, and Kagan. Justice Scalia wrote a dissent joined by Justices Thomas and Alito. The Court found that the tax credits are not limited to state Exchanges as the ACA’s context and structure lead to the conclusion that tax credits are available for health insurance purchased on any Exchange created under the ACA.

    How the Decision Affects Employers
    Because the Supreme Court upheld the federal government’s position and the ruling of the Fourth Circuit in King, qualifying individuals will continue to remain eligible for subsidies regardless of whether they obtain coverage on a state or federal Exchange. Keep in mind, however, that subsidies generally are not available for employees who are eligible for employer-sponsored coverage, if the coverage offered meets certain affordability and minimum value thresholds.

    Employers need to continue to focus on ACA implementation. All of the ACA provisions remain in place with this ruling. For example, employers will continue to be subject to extensive reporting requirements and the Employer Shared Responsibility requirements will continue to apply. In addition, employers will need to continue to analyze the possible effects of the 40-percent Excise Tax on high-cost plans that will take effect beginning in 2018.

    References: EOW from ADP

  • Federal Guidance, Human Resources Comments Off on New Minimum Wages for States

    Many states have approved minimum wage increases for 2015. Some have also scheduled additional increases for future years and/or tied future minimum wage increases to inflation. The following states have new minimum wage rates for 2015:
    •Alaska ($8.75 effective 2/24/15)
    •Arizona ($8.05 effective 1/1/15)
    •Arkansas ($7.50 effective 1/1/15)
    •Colorado ($8.23 effective 1/1/15)
    •Connecticut ($9.15 effective 1/1/15)
    •Delaware ($8.25 effective 6/1/15)
    •District of Columbia ($10.50 effective 7/1/15)
    •Florida ($8.05 effective 1/1/15)
    •Hawaii ($7.75 effective 1/1/15)
    •Maryland ($8.00 effective 1/1/15)
    •Massachusetts ($9.00 effective 1/1/15)

    •Minnesota ($9.00 effective 8/1/15)
    •Missouri ($7.65 effective 1/1/15)
    •Montana ($8.05 effective 1/1/15)
    •Nebraska (8.00 effective 1/1/15)
    •New Jersey ($8.38 effective 1/1/15)
    •New York ($8.75 effective 12/31/14 through 12/30/15)
    •Ohio ($8.10 effective 1/1/15)
    •Oregon ($9.25 effective 1/1/15)
    •Rhode Island ($9.00 effective 1/1/15)
    •South Dakota ($8.50 effective 1/1/15)
    •Vermont ($9.15 effective 1/1/15)
    •Washington ($9.47 effective 1/1/15)
    •West Virginia ($8.00 effective 1/1/15)

    Look for more states to consider minimum wage increases in 2015. Changes may also be seen at the federal level; President Obama has called for Congress to raise the federal minimum wage.

  • Employers sometimes mistakenly assume that the National Labor Relations Act (NLRA) only applies to unionized workforces. However, both unionized and non-unionized employees have rights under the Act. For instance, Section 7 of the NLRA gives employees, among other things, the right to act together to try to improve their pay and working conditions, with or without a union. These protections are known as “concerted protected activity.”

    In recent years, the National Labor Relations Board (NLRB), the agency that enforces the NLRA, has decided a number of cases regarding the circumstances in which employer policies may violate Section 7 of the NLRA. The NLRB has found that employer policies and practices violate the NLRA if they:
    • Explicitly restrict Section 7-protected activities (e.g., expressly bar the discussion of wages and working conditions with co-workers and third parties);
    • Would reasonably be construed to prohibit Section 7-protected activities;
    • Are established in response to union activity; or
    • Are applied to restrict the exercise of Section 7 rights.
    The following are examples of policies that have been scrutinized by the NLRB.
    Workplace Gossip:
    The NLRB recently affirmed the decision of an administrative law judge who found an employer’s no-gossip policy violated the NLRA (see NLRB Case Number 10-CA-093934). The policy stated that employees may be subject to discipline for, among other things, talking about a person’s professional life without his or her supervisor present; sharing information that could injure a person’s credibility or reputation; and making negative or disparaging comments or criticisms about someone. The judge concluded that the policy was overly broad and could reasonably be construed to prohibit employees from discussing or complaining about working conditions.

    Social Media:
    The rapid rise in social media use has prompted many employers to develop policies prohibiting employees from tarnishing the company’s reputation through social media postings and limiting the use of social media during work time. The NLRB has begun to scrutinize these policies to see whether they interfere with employees’ rights to act together to improve wages and working conditions. As a result, the NLRB has taken the position that an employee’s use of social media to discuss or protest working conditions is considered concerted protected activity under the NLRA, and employers’ attempts to control or limit the flow of that information may violate the NLRA.

    Below is a summary of some of the social media policy provisions the NLRB has considered unlawful (see the NLRB’s Office of General Counsel Report, May 2012):
    • “Offensive, demeaning, abusive or inappropriate remarks are as out of place online as they are offline, even if they are unintentional.”
    • “Don’t release confidential guest, team member or company information.”
    • “Think carefully about ‘friending’ co-workers.”
    • “Avoid harming the image and integrity of the company.”
    • “Get permission before posting photos, video, quotes or personal information of anyone other than you online. Do not incorporate [employer] logos, trademarks or other assets in your posts.”
    The NLRB faulted the above provisions because they could discourage protected activity or were too ambiguous and employees could reasonably construe that they applied to protected activity. Social media policies should be drafted carefully, providing sufficient details and contexts to make it clear that the rules do not infringe on protected activity.

    Pay Confidentiality:
    The NLRB has consistently found that policies that prohibit employees from discussing their pay with co-workers violate the NLRA. The NLRB has rejected arguments from employers that this type of policy is necessary to avoid discord in the workplace.

    Employers generally are permitted to prohibit solicitation on their premises by non-employees, as long as the policy is applied in a nondiscriminatory manner. A blanket policy that bars all solicitation by employees, however, may violate the NLRA, particularly if it bans union-related solicitations during non-work hours. Non-solicitation policies therefore must be carefully worded and consistently applied so as not to be construed to apply to employees during non-work hours or prohibit protected activity. Employers should work with legal counsel when drafting non-solicitation policies.
    Employers with unionized and non-unionized workforces alike should be familiar with the NLRA and should consider reviewing their own policies and practices to determine whether changes should be made, consulting legal counsel as necessary. Employers who are uncertain as to whether their policies, practices, or decisions will interfere with an employee’s Section 7 rights are reminded to consider whether the work rule would “reasonably tend to chill employees” in the exercise of protected activity.

    ADP HR Tip of the Week.

  • Federal Guidance, Human Resources Comments Off on Summary of Taxpayer Relief Act of 2012 as it Relates to Employment Issues

    On January 2, 2013, President Obama signed into law the American Taxpayer Relief Act of 2012 (ATRA), in order to avoid the $600 billion in tax increases and spending cuts. Those changes that relate to employment are summarized below:

    • Individuals with incomes up to $400,000 and families with incomes up to $450,000 will be taxed at 39.6%, up from 35%. The expanded 15% bracket for joint filers, commonly referred to as the marriage penalty relief, has also been extended.
    • Unemployment benefits have been extended under the Emergency Unemployment Compensation Act (EUC) through 2013. There are no changes to state unemployment tax benefits, or the tier levels under EUC. The maximum number of weeks of benefits remains at 73 weeks.
    • 401K account holders will be allowed to convert a portion of their balance into Roth accounts that can be accessed tax-free at retirement.
    • Mass transit benefits allow employers to exclude up to $125 per month as wages to employees, and up to $245 per month for parking benefits.
    • Employers can provide undergraduate and graduate educational assistance of up to $5,250 annually as a permanent amount that is excluded from taxable income.
    • The Work Opportunity Tax Credit is extended thru 2013, allowing certain non-profit employers to deduct up to $9,600 paid to certain veterans from employer Social Security wages. The credit is up to $6,240 for certain tax-exempt employers.
    • The credit for differential wage payments to active military employees is extended thru 2013, so that wages paid to them during active duty will not be subject to Social Security tax. Reservists who are not on active duty and are working under employment, are not eligible for this credit.
    • For employers with an adoption assistance program, the credit is extended thru 2013. The costs associated with a qualified adoption are excluded from federal income tax withholdings, provided the employee is not highly compensated at $115,000 in wages from the previous year, or is a 5% owner. This credit is made permanent.



    IRS. (2012) www.irs.gov

    SBA. (2012) www.sba.gov


  • Federal Guidance, Human Resources Comments Off on Extension of Federal Unemployment Benefits in New Tax Legislation for 2013

    The recent tax legislation passed by the Senate to avoid the fiscal cliff, and to extend Bush-era tax cuts, has caused Federal Unemployment Benefits under the Emergency Unemployment Compensation (EUC), to be extended as well as some of the other tax cuts. There are no changes to the tiers of weeks available, or amounts, only that the program is extended now to 12/31/13.

    Most State unemployment benefits provide for 26 weeks of benefits through the state office. (Some states offer a lower number of weeks.)

    Then, the tiers under the EUC are initiated. They are:

    Tier 1– up to 14 weeks of additional benefits and is offered by all states

    Tier 2–up to 14 weeks of additional benefits if the state unemployment rate is 6% or higher

    Tier 3–up to 9 weeks of additional benefits if the state unemployment rate is 7% or higher

    Tier 4–up to 10 weeks of additional benefits if the state unemployment rate is 9% or higher

    So, the maximum number of weeks an unemployed worker can received benefits is 73.

    Always check with your state unemployment office to verify the number of weeks they offer, and under which tier you will qualify, depending upon the initial date that you filed an unemployment claim.


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