Tag Archives: ACA

How Should Employers Respond to 2016 Election?

Employers are facing a time of uncertainty in the workplace as a result of last week’s election. Does an employer still have to worry about compliance with the revised overtime rules? Do you still have to complete the Affordable Care Act tax forms due in January? What about paid maternity leave—must an employer provide salary for six weeks to new mothers? There will certainly be upheaval in the workplace because of the significant change in the governing philosophy to come in January.

Alth19-ryan-trump-mcconnell-w710-h473ough Mr. Trump is already backing off of some of his campaign rhetoric, there are some workplace issues that you as an employer will be affected by:

  • Immigration compliance should be your top concern under this new administration. As an employer, you must be certain that you are correctly completing an I-9 form on every new employee and assuring that you are only hiring applicants who are eligible to work in the United States.
    • A new I-9 form was released today, so you will need to start using that new form dated November 14, 2016, immediately with your new hires. The old 2013 form you have been using may not be used after January 21, 2017. You do not have to recertify your current employees just because they were hired when a different I-9 version was in use.
    • Trump has said that he wants all employers to use E-Verify, the internet verification program used by federal contractors to verify I-9 information provided by a new hire against records from Social Security Administration and the Department of Homeland Security. E-Verify sounds much easier in theory than it has proven to be in practice. Get ready for significant paperwork and several new steps whenever you receive a tentative non-confirmation letter from E-Verify on a new hire.
    • Remember that it is illegal to discriminate against an applicant on the basis of national origin or ethnicity. As an employer, you cannot have blanket hiring prohibitions against any group. You must individually check the employment eligibility of each person to whom you offer a job.
  • The new overtime law, which requires employers to pay at least $47,476 in salary to employees whom the employer wants to exempt from the overtime requirements, goes into effect in two weeks on December 1, 2016. That means that you as an employer need to comply with that law now without regard to how it may change down the road.
    • A change to the overtime law is not included in the new administration’s first 100-day plans and Mr. Trump only addressed it one time on the campaign trail. Changing the overtime regulation does not seem to be a top priority, but the possible changes that have been mentioned are an elimination of the automatic increases now scheduled every three years and a small business and/or nonprofit exception to the overtime rule.
    • The final overtime regulation took more two years to become effective after President Obama proposed it. Even if a change to it were fast-tracked, I think that you will have to comply with the current regulation at least until the end of 2017.
    • And even if the new rule is changed next year, are you really going to decrease the salaries of your management employees after they saw the increase this year? If you would consider a decrease as a possibility in the future, then think about putting your salaried employees on hourly pay and overtime pay immediately (by December 1) instead of giving them salary whiplash when this regulation changes down the road.
  • The Affordable Care Act is going to change significantly. How it will change, we don’t know, except that Mr. Trump has promised that it will be “replaced”, not just repealed. If that is the case, employers will still have to deal with healthcare headaches. They will just be new headaches rather than the ones we have learned to cope with over the last six years. For now, as an employer, you must continue to comply with the ACA, including sending out the Form 1095-C after the first of the year.
  • Trump has proposed six-week paid maternity leave. Never before has the federal government required a private employer to provide any paid leave, unless the company was a federal contractor. The Family and Medical Leave Act only requires unpaid leave.
    • This would be a radical departure from Republican policies in the past, which have always frowned on mandates to employers to pay people not to work. There is no indication yet that the U.S. Congress would go along with Mr. Trump’s proposal.
    • Meanwhile, employers should be more concerned right now about complying with the Pregnancy Discrimination Act in effect since 1978, but which has grown more teeth in the last couple of years thanks to the U.S. Supreme Court decision in Young v. UPS and stricter enforcement by the EEOC.
  • Title VII of the Civil Rights Act of 1964 remains the law and no administration would dare push for its revision, or the revision of later laws that prevented discrimination on the basis of age or disability. That means that as an employer (if you have 15 or more employees), you must continue to keep your workplace free from discrimination and harassment on the basis of sex, religion, national origin, ethnicity, age, disability, etc.
    • There were 3500 charges of religious discrimination filed in 2015 with the EEOC. That number has risen 44% in the last 10 years. Employers must be extra vigilant that some of the tenor and tone of the election rhetoric doesn’t lead to any hateful actions in their workplace against, for example, a Muslim employee.
    • Discrimination on the basis of sexual orientation and/or gender identity is not prohibited by the actual language of Title VII and it seems unlikely that the new administration would champion gay rights in the workplace. There is also no state law in Texas preventing such discrimination, although most of the larger cities in Texas have local ordinances. But employers need to know that the EEOC has targeted employers who are allowing discrimination against LGBT employees and there are several court rulings that back up the EEOC’s position that “sex” as a protected class includes sexual orientation, so all employers should continue to protect their LGBT employees from harassment and unfair treatment.

 

 

Affordable Care Act is the Law

The United States Supreme Court confirmed today that the Affordable Care Act (“ACA”) is the law and is here to stay. In deciding King v. Burwell, the Court for the second time upheld the health care law that was passed by Congress in 2010.

What does King v. Burwell mean for employers? Not much. As an employer, you just have to keep soldiering on to make the ACA work in your business, just as you have been doing for the last several years.

Of course, how big an issue the ACA is to you as an employer depends on the size of your workplace. To apply the ACA, you as the employer have to count your employees and determine how many “full-time equivalents” that you employ. Under the ACA, a full-time employee is one who is employed an average of at least 30 hours per week.

The Affordable Care Act’s mandate, requiring employers to provide health insurance to employees or face a penalty, does not apply to employers with less than the equivalent of 50 full-time employees. This is the small business exemption to the mandate and means that small businesses can choose whether to provide health insurance at all.

If you have between 50 and 99 full-time equivalent employees, you have been getting ready for the Affordable Care Act this year, since 2016 is the year that you are required to provide your full-time employees with affordable health insurance coverage or pay a potentially substantial penalty.  You are probably still working out the kinks in your system of counting hours, determining who is full-time, setting measurement periods. Next year you will be getting employees signed up and answering endless questions from your employees about their coverage.

If you have 100 or more full-time equivalent employees, then 2015 is the first year you have been required to  provide health insurance to your employees or pay a penalty. The penalty is imposed if at least one of your full-time employees receives a subsidy to purchase coverage in the individual Marketplace. So the subsidies that the Supreme Court upheld in King v. Burwell today will determine if you as an employer get penalized.

But at least you have a little margin for error this year if you employ 100 or more people. In 2015, you only have to offer coverage to at least 70 percent of full-time employees, rather than 95 percent which will begin in 2016.

There are other changes on the horizon for you as an employer in dealing with the ACA. Continue reading Affordable Care Act is the Law