Federal Legislative Update 

Washington Outlook - HR issues to watch in the 112th Congress

SHRM recently conducted a webinar, in which the Government Affairs Committee of CHRA participated. We have condensed this information in order to provide CHRA members with a summary of what to watch on the Federal level.

With the last elections resulting in Republicans controlling the House, there remain challenges in consensus building with the Democratic controlled Senate. Further complexities have been introduced with the Tea Party candidates gaining seats.

CHRA will participate ongoing in a partnership with SHRM involving legislative advocacy. SHRM is creating a well organized lobbying strategy to ensure that personal relationships exists with Federal elected officials and HR representatives from each legislative district in the United States. The Government Affairs Committee will provide support with this initiative, and is seeking new committee members as our role continues to expand.

ONGOING UPDATES:

Status of the Congressional Resolution on National Labor Relations Board's Quick Election Rule

• If the resolution introduced last month passes, the quick election rule will be nullified. As this is a joint resolution, only 51 votes are needed in the Senate vs. 60 to block the quick election rule. It is expected to be a tight vote in the Senate, and the timing we'd expect would be in April. The resolution should not have any problems getting through the House. The chances that President Obama would veto this are fairly strong.
  
  Section 127 Educational Assistance
  
  
• Allows employer sponsored educational assistance to be excluded from an employees gross income. This has been in existence since 1978 and the Federal Government has extended Section 127 a total of  9 times. It is not expected that a separate bill will be introduced to make a permanent extension. We do expect this to become part of a larger tax package sometime in November or December.
  
  Family Medical Leave Act (FMLA)
• The Department of Labor has proposed an amendment to FMLA. In 2009 the Airline Flight Crew bill and the Defense Authorization Act were introduced into FMLA, the proposed amendment would simply implement these two pieces. However, an amendment was introduced with this that was not expected. The amendment would revert FMLA back to the standard prior to 2009 in time calculation. Employers would have to calculate FMLA leave using employers shortest increment leave at any time.
• The public comment period on this has begun and comments will be permissible through April 16, 2012.
  
  Federal Legislative/Regulatory Update:
  
  *December 23, 2011 - (H.R. 3765)  Congress passed two-month payroll tax extension.  This will extend the two-percentage-point payroll tax cut, continue expanded unemployment benefits, and continues to keep a reduction in Medicare payments to doctors suspended through the end of February 2012.  Congress expects to continue the debate for a long-term solution in the interim.
  

Key Federal Issues affecting HR Public Policy:

- Workplace Flexibility/Leave Benefits
- Tax & Benefit Issues/Healthcare Reform
- Employment Verification
- Labor-Management/Civil Rights Issues

Workplace Flexibility/Leave Benefits

• Advocates continue to push legislation to expand FMLA benefits and require paid sick leave but highly unlikely at the federal level.
• SHRM testified in the House on the issue in April and November of 2009 and again in May of 2010.
• SHRM is working with groups across the work-flex spectrum on flexible work arrangements and work-life policy:
  • Partner Coalition on Workplace Flexibility
  • National Workplace Flexibility campaign
• Families and Work Institute and SHRM announced new partnership: Moving Work Forward on February 2, 2011, to encourage greater adoption of workplace flexibility programs at worksites.
  

Tax & Benefit Issues

Tax & Benefit Issues & Health Care Reform

Small Business Paperwork Mandate Elimination Act of 2011 (H.R.4)

• Under PPACA, employers are required to file a 1099 tax form reporting any purchase it makes of any goods or services above $600 from any individual or business
  
  
• Previously, employers must only file a 1099 on the purchase of services and only when the entity is an unincorporated business
  
  
• Bill would repeal the 1099 tax form and it passed the House by 314-112. It passed the Senate on April 5 by a vote of 87 to 12
  
  
• The 1099 requirement was projected to raise $17.1 billion dollars over ten years and was included in the health care bill to offset its costs
  

Help Efficient, Accessible, Low-Cost, Timely
Health Care (HEALTH) Act of 2011 (S.218 & H.R.5)

• Introduced by Representative Phil Gingrey (R-GA) in the House and Senator John Ensign (R-NV), the bill makes changes to the process and adjudication of medical malpractice claims.
  
  
• Limit the amount of time that an individual may file a health care lawsuit to:
  • Three years after the manifestation of an injury connected to medical product or service or
  • One year after the claimant discovers or should have discovered the injury; whichever occurs first
    
    
• Provide for unlimited economic damages for actual injuries suffered by an individual.
  
  
• Restrict non-economic damages to the greater of:
  • $250,000 or twice the amount of economic damages awarded, regardless of the number of parties, claims, or actions
    
    
• Allow the judge in the case to cap the amount of contingent fees awarded to a plaintiff' attorney.
  
  
• Permit the awarding of punitive damages only if proved by clear and convincing evidence that the defendant:
  • Acted with malicious intent to injure the claimant, or
  • Deliberately failed to avoid unnecessary injury and knew that the claimant would suffer an injury

Employment Verification

• Comprehensive immigration reform highly unlikely in 2011
• Targeted enforcement bill are on the horizon in the 112th and Chairman of the House Judiciary Committee has held hearings on E-Verify this term
• Stepped up enforcement by the Obama Administration continues in the employment verification and employment visa areas
• On January 20, DHS opened the Employment Compliance Inspection Center. Center will focus on the inspection of the employment records of some of the nation's largest employers
• DHS launched E-Verify Self-Check Program in March
• States have become more aggressive in passing immigration laws
  

In the fiscal year that ended Sept. 30, 2010, ICE conducted audits of more than 2,740 companies, nearly twice as many as the previous year. The agency levied a record $7 million in civil fines on businesses that employed illegal workers.

Jobs Recovery by Ensuring a Legal American

Workforce Act Of 2011 (H.R.800)

• Introduced by Representative John Carter (R-TX) and Heath Shuler (D-NC), the bill makes permanent the electronic verification system for employment (aka E-Verify)
• Requires employers within three working days of hire to check each new employee's work eligibility using the system
• Requires federal agencies, federal contractors and employers with 250 or more employees to use E-Verify within one year after enactment
• Employers would continue to be required to attest on Form I-9 that he/she had examined the new hire's employment and identification documents to ensure authenticity
• Phases in participation of other employers as follows:
  • employers with 100 or more employees, eighteen months after enactment;
  • all remaining employers, two years after enactment
• Employers would be required to re-verify the employment eligibility of all previously hired employees using E-verify at the same time they are required to use the system for new hires
• Directs Social Security to notify employers of "no-match" information on employees and requires the information to be corrected within 10 days or the employees are to be terminated
• Directs Social Security to notify any individual if the wages of two or more employers are being reported for the same Social Security number
  

Department of Homeland Security

E-Verify Self-Check

• Announced in March by DHS and it allows employees to enter data into E-verify to ensure that all information related to their employment is accurate
• E-Verify Self-Check consists of four steps:

1. Users enter identifying information online
2. Users confirm their identity through an identity assurance process
3. Users confirm their identity by answering demographic and/or financial questions generated by a third-party service
4. Users enter work eligibility information

Labor Management/Civil Rights

• With Republicans in control of the House, proposals such as EFCA and other union-backed legislation will get little attention
• Look for increased activity at NLRB, EEOC and DOL

Secret Ballot Protection Act (H.R. 972 / S. 217)

Introduced by Rep. Phil Roe (R-TN) and Sen. Jim DeMint (R-SC)

• Would amend National Labor Relations Act to make it an unfair labor practice for an employer to recognize or bargain collectively with a labor organization that has not been selected by a majority of the employees in a unit in a secret ballot election conducted by the National Labor Relations Board
• Effectively the opposite of the Employee Free Choice Act
• House Republicans may push the bill
• Watch activity in the states (Wisconsin, Indiana, Ohio and Florida), as well

National Labor Relations Board

Proposed Rules Governing Notification of Employee Rights

• In December, the National Labor Relations Board (NLRB) issued a proposed rule requiring employers subject to the National Labor Relations Act (NLRA) to post notices informing their employees of their rights under the NLRA
• The proposed rule sets forth the size, form and content of the notice. It also includes sanctions that may be imposed if an employer fails to comply with its obligations under the rule
• Fifteen SHRM state councils and 13 chapters signed onto SHRM's comments (including Maryland). In addition, over 5,000 individual SHRM members submitted comments on the proposed rule.
• SHRM made three main points in its comments to the NLRB:
  • The NLRA, unlike many other employment statutes, does not include a provision requiring employers to post a notice of rights. For this reason, we do not believe the NLRB has the statutory authority to require it
  • In addition to requiring that the notice be posted, the rule creates new (and serious) penalties for those employers who fail to post the notice
  • The text of the required notice, included in the rule, does not present the rights to join or not join a union in a fair manner

Equal Employment Opportunity Commission

Barriers to Employment Hearings

• Focus of hearings has been on:
  • Frequency or use of certain practices
  • EEOC concern over potential disparate impact
  • Effective HR practices in each area
    
    
• Hearings have been on:
  • Use of credit reports (Oct. 2010)
  • Older workers (Nov. 2010)
  • Discrimination against the unemployed (Feb. 2011)
    
    
• Hearing on criminal background checks expected later this Spring
  

Equal Employment Opportunity Commission

ADA Amendments Act Implementing Regulations

• Final rule was issued on March 25
• SHRM commented on several areas of the proposed rule:
  • The concepts of "Condition, Duration and Manner" should still be used in assessing whether an impairment "substantially limits" a major life activity
    
    
  • The proposal's list of "per se" disabilities violated Congressional intent by discarding the individual assessment recognized by Congress
    
    
  • The proposal to change the definition of "working" to focus on the "type of work" an individual is performing rather than the accepted concepts of "class" or "broad range" of jobs, exceeded Congressional intent
    

We are seeking new candidates for the Government Affairs Committee (GAC). Attendance is mandatory at 8 of our 12 monthly meetings. Most meetings are conference calls. GAC hosts up to 2 in person meetings annually. Members may miss up to 4 during the calendar year. Each member of the committee will submit an article involving their area of expertise during the calendar year.

If you have any interest in the GAC or questions regarding any of these Federal issues and CHRA's position, please contact Greta Engle, Director of Government Affairs gengle@kaig.com.

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