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Government Affairs Committee Federal Legislative Updates

Current Federal Employment Law Updates

For an update on Federal Employment Laws that SHRM is tracking, please visit SHRM's Policy Action Center and look under "Legislation We Are Tracking."

Past Federal Employment Law Updates

Updates 2013:

PPACA & State Exchanges  
The Insurance Exchange Marketplace opened in accordance with the Affordable Care Act on 10/1/2013. Maryland is not unique in challenges that began as traffic to the state's website occurred. Maryland reported anticipating approximately 150,000 individuals would be signing up on our state exchange. After 3 weeks of the exchanges open, those numbers remain below 500 total enrolled.  

There remain nation-wide concerns about data integrity and HIPAA privacy, as well as the reliability of State and Federal Exchanges after numerous glitches were reported in the first few weeks.  

To visit the Federal Insurance Exchange: click here
To visit the Maryland Insurance Exchange: click here

Kaiser Family Foundation (KFF) has many articles and support tools, including how to easily tell whether or not you would qualify for a Healthcare Subsidy under the Exchanges. It should be noted that Smokers will not see Subsidy dollars for Healthcare and will pay thousands more (for a family of 4) if they use tobacco than Non Smokers will pay.  

A link, which includes KFF's subsidy calculator and to test your knowledge of the law with an interactive quiz, visit: http://kff.org/graphics/health-reform/#./?&_suid=138237374189706054639471578683

 

PPACA - Notice of Exchanges Post Marked by 10/1/2013

Employers are required to send out written notices of the insurance exchanges to their New and Active employees no later than October 1, 2013. Employers can modify the model notice provided by the Department of Labor with their existing benefit plan eligibility. The notice also speaks to eligibility for Federal subsidies under the insurance exchanges. It should be noted that there is no financial penalty in 2014 for failure to send the notice timely, or for any errors that may appear in the notice. We would expect this to change as requirements tighten up on SBC's and other legal required notices under PPACA. 

 

 

7/31/13 the Patient Centered Outcomes Research Institute Fee (PCORI)
...is due from all employers with group health plans. This includes FSA’s or fully insured medical plans with HRA’s in which the employer makes a contribution. This is a fee being charged across the nation to cover the total cost to study healthcare outcomes under PPACA.

For fully insured employers, your health insurance carrier should be filing and paying the applicable fee. If you have a Flexible Spending Account or an HRA that the employer contributes to, you must file and pay the fee for each member (not just employee) covered under the plan. Self-funded employers must file and remit payment directly to the IRS. The cost is $1.00 per covered member for the year.

Here is a link to the form - http://www.irs.gov/pub/irs-pdf/f720.pdf

Send Form 720 with your check and payment voucher to:

Department of the Treasury Internal Revenue Service

Cincinnati, OH 45999-0009

Employer Pay or Play Mandate Delayed for One Year
Yesterday the Treasury Department announced a one-year delay of the Pay or Play rules and the Pay or Play reporting requirements on employers. Penalties for not offering coverage to full-time employees and dependents, and penalties for not offering affordable, minimum value coverage have been delayed until 2015. Those penalties only apply to employers who have 50 or more full time employees. Full time employment is defined as 30 hours per more each week.

The Treasury Department noted that their actions do not affect access to premium tax credits, the individual mandate or any other provision of the ACA. Formal guidance implementing the delay is to be published next week. (The PCORI tax, the temporary reinsurance fee, the 90-day limitation on waiting periods, the prohibition on preexisting condition exclusions, the Exchange Notice, as well as other health insurance reforms have NOT been given a one-year delay in this announcement so please make sure you are meeting these requirements where applicable.)

According to the announcement, the one-year delay is designed to meet two goals. First, it will provide time to simplify the new reporting requirements. Second, it will provide time to adapt health coverage and reporting systems while employers move toward adjusting health coverage to be compliant.

To restate, this does not change any existing fees, or administration and other requirements. Employers will still need to be fully prepared to demonstrate record keeping methods under the Affordability provision and be able to track their variable hour employees.

Updates 2012:

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.

Updates 2011:

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:
  1. 1. Partner Coalition on Workplace Flexibility
  2. 2. 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 & Health Care Reforms:

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:
  1. 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:
  1. $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:
  1. Acted with malicious intent to injure the claimant, or
  2. 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:
  1. employers with 100 or more employees, eighteen months after enactment;
  2. 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)

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:
  1. 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
  2. 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
  3. 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:
  1. Frequency or use of certain practices
  2. EEOC concern over potential disparate impact
  3. Effective HR practices in each area
  • Hearings have been on:
  1. Use of credit reports (Oct. 2010)
  2. Older workers (Nov. 2010)
  3. 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:
  1. The concepts of "Condition, Duration and Manner" should still be used in assessing whether an impairment "substantially limits" a major life activity
  2. The proposal's list of "per se" disabilities violated Congressional intent by discarding the individual assessment recognized by Congress
  3. 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


 

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