Legislative Affairs

 September 2017 Legislative Update

 

By: Vickie Warren, S-CP, SPHR

In an article dated August 15, 2017, Allen Smith, J.D., writing for SHRM, posed the question “Can or Should Employers Fire Employees Who Participate in Hate Groups?” Smith stated that one rally participant lost his job after pictures of him marching in the Charlottesville rally were posted on social media.

 

Unfortunately, per Smith, the answer is not clear. Attorneys recommend a case-by-case investigation and keeping state law in mind as far as the employer is concerned. It also depends on whether or not the employer wants to take the risk. The article does note that Michael Eastman, an attorney with the Center for Workplace Compliance (formerly the EEOC Advisory Group) in Washington, D.C. said there is no federal law that would be violated in firing the worker. In addition, Eastman stated that the First Amendment’s protection of speech applies only to the government, not private employers. Private-sector employers do not have to allow employees to say things that others would find offensive.

 

The article went on to state that generally employment is at- will (Indiana is an employment- at-will state) and employees can be fired for any reason as long as it does not violate the federal/state EEOC statutes. Employers should check to see what their policies are for off-duty conduct. If an employee’s off-duty conduct carries over into the workplace the employer could be defending a claim of discrimination under the EEOC, especially if the employee is a manager and a self proclaimed nationalist. Look at how the employee behaves on the job-if an employee is not respectful in their private life, you can bet that it carries over into their work life too.

 

https://www.shrm.org/resourcesandtools/legal-and-compliance/employment-law

 

I just saw a sign the other day that a local restaurant is paying their wait staff, $10 hourly rate PLUS tips, so the article written again by Allen Smith, J.D. for SHRM was very interesting. Smith reported that the DOL is planning on proposing a new rule that would allow Tip Pooling as long as the wait staff are making the federal minimum wage (currently Tip Pooling is unlawful to do). Tip Pooling is where the “front of the house” employees (wait staff) share their tips with the “back of the house” employees (chefs, dishwashers, and bussers). Per Smith, the DOL’s new ruling could change many of Obama administration’s wage and hour regulations.

 

https://www.shrm.org/resourcesandtools/legal-and-compliance/employment-law

 

Speaking of the retail industry or any industry that has variable scheduling, SHRM also reports that there may be efforts in 2017 to pass “Predictable-Scheduling” laws by cities. These types of laws would require employers to provide employees work schedules in advance and to pay employees for last minute changes. Apparently, San Francisco has passed that law in 2014 and Seattle, Washington’s predictable scheduling was passed in 2014, and was effective July 2017. New York City has introduced similar legislation this year. Indiana and Evansville, in particular, is pretty conservative, but it’s better to be forewarned—you just never know.

 

https://www.shrm.org/resourcesandtools/legal-and-compliance/state-and-local-updates

 

 

May 2017 Legislative Update

Legal Soundbites

By: Vickie Warren, S-CP, SPHR

On April 26, 2017, Governor Holcomb stated that he plans to sign a new law that removes questions about someone’s criminal history from state applications. The “Ban the Box” effort is aimed at letting people with a criminal past explain themselves during an interview. This new law cannot exclude applicants convicted of a crime from getting a job interview and state employers cannot ask applicants about criminal records before an interview. The “Ban the Box” approach prevents an early elimination of applicants so that an ex-offender can be considered based on what they can offer an employer during the interview process. Background checks can still be performed, but it will be delayed until after the interview has been conducted. Besides Indiana, Utah is the only other state to join the “Ban the Box” movement.

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We may have gotten a breather from Obama’s administration new overtime regulations, but it’s not dead. The DOL overtime rule would have raised the salary level to $47,476 per year and automatically increase that base every three years. But several states filed a motion to bar the rule which was granted in November 2016. Naturally, the DOL appealed that decision to the 5th US Circuit Court of Appeals. On April 14, the Justice Department asked the 5th Circuit for another delay to June 30, 2017. Speculators say that the DOL wants to wait until the appointment of the wage and hour administrator and solicitor of labor. Trump’s pick for labor secretary, Alexander Acosta, states that he would like the overtime rule altered to match inflation, and using a salary threshold of $33,000 vs the $47,476.

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As stated in the media, the Republican’s efforts to repeal and replace the ACA are suffering roadblocks. The GOP is attempting to obtain enough support in the House to approve a revised version of the American Health Care Act (AHCA). In an article by Stephen Miller, CEBS, for SHRM, House Speaker Paul Ryan, R-Wis, was quoted at a 2017 Legislative Seminar on April 26 in Washington, DC. “Getting consensus among our members (in Congress) is always a challenge, especially when you’re trying to do something as enormous as repealing and replacing Obamacare. We’re making progress, but it takes time.” Employers are hopeful that the AHCA will get relief from the onerous administrative requirements and penalties. The House did approve HR 1101 – Small Business Health Fairness Act, which made it easier for small businesses to get together with other small businesses in multiple states to offer benefits across state lines and offer employees coverage through association health plans (AHPs). AHPs would work direct with an insurer to obtain better rates and they could also self fund. Self funded AHPs would not be governed by state and federal requirements. However, the bill could face problems in the Senate. Opponents of the bill state that it would diminish the states’ regulating of health coverage sold to their residents.

HR 1180, the Working Families Flexibility Act of 2017 was approved by the House Committee on Education and the Workforce on April 26 – the bill will now be sent to the full House at a future date, to be determined. This bill would amend the FLSA and give private employers the option of offering employees with an alternative to cash overtime with a time-off-for-overtime. Public sector employees have received this option for more than 30 years. The bill includes a maximum cap of 160 hours and a written agreement by the employee for the ‘comp’ time approach. However, the employee can have their hours paid out in cash at any time. The employer must pay out the ‘comp’ time to the employee in cash at the end of the year due to tax laws. SHRM supports this bill.

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May 1 is International Workers Day, 340,000 restaurant workers and unionized service workers plan to strike. Unionized nurses in Minnesota, Philadelphia, and Seattle, are also planning to participate. SHRM advises employers to address any absences on May 1 the same as they would for any other day. Strike activities on May 1 may be protected concerted activity under the National Labor Relations Act (NLRB) per some attorneys. Other attorneys state that protests on public policy are usually not. SHRM recommends that employers should be cautious about any statements or actions against employees who do strike on May 1, especially if the employee is not scheduled to work on that day. NLRB will focus on any discharge for not showing up to work on May 1.

 

March 2017 Legislative Update

HOUSE REPUBLICANS RELEASE ACA REPLACEMENT PLAN

By:  Ben Schmitt, CSFP, ONI Risk Partners

On Feb. 16, 2017, Republican leadership in the U.S. House of Representatives issued a policy brief describing its intended approach for replacing the Affordable Care Act (ACA).  Furthermore, a draft has been released of a bill that provides additional details for the potential plan.  In the policy brief, House Republicans reiterated their goals of repealing the ACA and implementing a replacement plan aimed at providing more choices, lower costs and greater control for consumers over their health care. In addition, the policy brief promised a “stable transition period to a patient-centered health care system” following the ACA’s repeal, until a replacement plan can be implemented.

IMPACT ON EMPLOYERS

The ACA and its requirements remain intact for now, and employers should continue to comply. However, efforts are underway to make changes to the law’s key provisions. Legislation may be advanced in the weeks ahead to repeal and replace the ACA. The policy brief and draft bill provide valuable insight into how many aspects of the current health care system, including employer plan rules, could be impacted.

Overview

The replacement plan described in the policy brief would address these issues by building on a proposed approach created by House Republicans in June 2016, called the “Better Way” health care plan. Key elements of the new replacement plan include:

  • Providing relief from the ACA’s taxes and mandates, including eliminating immediately the individual mandate and employer shared responsibility penalties.
  • Providing portable, monthly tax credits that individuals can use to purchase health insurance.  The credit would not be available to individuals who are eligible for coverage through other sources (specifically, through an employer or government program).  If an employer does not subsidize COBRA coverage, the individual would be able use the credit to help pay unsubsidized COBRA premiums while he or she is between jobs.  Additionally, if an individual does not use the full value of the credit, he or she can deposit the excess amount into an HSA. The draft details $2k per year for anyone under 30; $2.5k per year for 30-40; $3k per year for 40-50; $3.5k for 50-60; $4k for over 60.  It also includes an overall aggregate subsidy limit for a family of $14k.
  • Enhancing health savings accounts (HSAs) by increasing the amount that can be contributed and allowing them to be used to pay for over-the-counter (OTC) medications. Their proposed policies include significantly increasing the HSA contribution limits by allowing HSA contributions to equal the maximum out-of-pocket limits allowed by law. For 2017, those amounts are $6,550 for self-only coverage and $13,100 for family coverage.  Additionally they would allow both spouses to make catch-up contributions to the same H.S.A.
  • Providing more flexibility and control to states in managing their Medicaid programs; and utilizing state innovation grants.
  • Finally, the draft bill would cap the employee tax deduction for employer-sponsored coverage. The bill includes a formula that gives the Treasury Secretary authority to set the cap at an amount equal to the 90th percentile for plan cost. That amount would be set for 2019 and then adjusted by a COLA adjustment thereafter. So, if the 90% threshold were $6,000 per year and the health insurance one received was worth $10,000 per year, the taxpayer would owe income tax on the $4,000 excess the same as if the taxpayer had received that $4,000 in salary.  This increase in taxable income is the key component to funding the replacement plan.

 

Conclusion

There is nothing final in any of the plans yet presented.  However, because repeal and replacement of the Affordable Care Act is being accomplished through the budget reconciliation process, there only needs to be a simple majority for Congress to make changes.