JULY 2021 LEGAL UPDATE
FUTURE COMPLIANCE DATES
AUGUST 2, 2021 (if on a calendar year plan) – Form 5500 Due
Group plans with 100 or more participants at the beginning of the plan year must file Form 5500 annually, by the last day of the 7th month following the end of the plan year. Outside of a few exceptions, all group health plans subject to ERISA are required to file a form 5500 when they have 100+ participants. In addition, most 401(k) plans — regardless of size — are required to file form 5500. For a list of exceptions and additional information, click here to visit the IRS 5500 Center. If an extension is obtained, forms are due by October 15, 2021.
AUGUST 2, 2021 – Form 941 Due
August 2, 2021 is the deadline to file Form 941, employer’s quarterly tax return, for the second quarter of 2021. Please note that a new version of Form 941 was released on June 24, 2021 by the IRS to account for COBRA subsidies granted under the American Rescue Plan Act.
AUGUST 2, 2021 – PCORI Fee Due
August 2, 2021 is the deadline to pay the Patient-Centered Outcomes Research Institute (“PCORI”) fee for the preceding calendar year. Sponsors of self-insured health plans are responsible to report on and pay PCORI fees, while insurers report on and pay PCORI fees for fully insured group medical plans.
The amount of the PCORI fee is equal to the average number of lives covered during the policy year or plan year multiplied by the applicable dollar amount for the year. The fee is $2.66 per covered person for plan years ending between October 1, 2020 and before October 1, 2021. For plan years that ended before October 1, 2020, the fee is $2.54 per person. The PCORI fee is expected to be in effect for policy and plan years with end dates through October 1, 2029.
AUGUST 23, 2021 – EEO-1 Reporting Due
The deadline for covered employers to submit 2019 and 2020 EEO-1 data has been extended from July 19, 2021 to August 23, 2021. Organizations with 100+ employees and organizations with federal government contracts of $50,000 or more and 50+ employees will be required to submit EEO-1 reports.
FEDERAL COMPLIANCE UPDATES
INTERIM FINAL RULE ON “SURPRISE” MEDICAL BILLS ISSUED
On July 13, 2021, the U.S. Departments of Health and Human Services, Labor, and Treasury issued an interim final rule to begin implementation of the No Surprises Act provisions of the Consolidated Appropriations Act which take effect on January 1, 2022.
The No Surprises Act protects patients from most surprise bills for out-of-network services and air ambulance providers. Provisions of the interim rule include the following protections:
- Emergency services, regardless of where they are provided, must be treated on an in-network basis without requirements for prior authorization.
- Patient cost-sharing, such as co-insurance or a deductible, cannot be higher than if such services were provided by an in-network doctor, and any co-insurance or deductible must be based on in-network provider rates.
- Bans out-of-network charges for ancillary care such as for an anesthesiologist or assistant surgeon at an in-network facility in all circumstances.
- Health care providers and facilities must provide patients with a plain-language consumer notice explaining that patient consent is required to receive care on an out-of-network basis before that provider can bill at the higher out-of-network rate.
For additional details see Interim Final Rule.
Federal agencies are accepting comments on the interim rule through Sept. 13, 2021. Written comments may be submitted electronically at https://www.regulations.gov.
USCIS UPDATES FORM I-9 LOST DOCUMENT POLICY
A new policy issued by the U.S. Citizenship and Immigration Services (“USCIS”) allows employees to present alternate documents to complete the Form I-9 employment eligibility verification process when initially providing a receipt for a lost or damaged document.
If an employee presents a receipt for a lost, stolen or damaged identity, employment authorization, or re-verification document to complete Form I-9 verification, he or she was previously required to produce the replacement document for which the receipt was issued. Under the new USCIS policy, another acceptable document can now be provided instead. The document must be provided within 90 days.
When receiving an alternative document, the employer should complete a new Section 2 on the I-9 form and append it to the previously completed form. The employer should also provide a note of explanation either in the Additional Information box included on page 2 of the Form I-9 or as a separate attachment.
IRS EXTENDS TEMPORARY RELIEF FROM PHYSICAL PRESENCE REQUIREMENT
The IRS recently issued Notice 2021-40, which provides a one-year extension — through June 30, 2022 — of the temporary relief from the physical presence requirement for certain plan elections required to be witnessed by a plan representative or notary public. Examples of participant elections that require a witness include 401(k) loan applications and spousal consent to changes in the distribution of survivor’s pension benefits.
Instead of the physical presence, Notice 2021-40 allows participant elections to be witnessed by a notary public conducted via live audio-video technology that meets the requirements for electronic participant elections and is consistent with state law requirements that apply to the notary public. The extended relief also allows participant elections to be witnessed by a plan representative if the person signing the participant election presents a valid photo ID during a live audio-video conference that allows for direct real-time interaction between the individual and the plan representative, and the individual transmits a legible copy of the signed document directly to the plan representative on the same date it was signed.
For additional details, see Notice 2021-40.
IRS UPDATES AUDIT GUIDE FOR NONQUALIFIED PLANS
The IRS recently updated its Nonqualified Deferred Compensation Audit Techniques Guide. The updated guide issued in June 2021 replaces the previous version published in June 2015 and provides additional details surrounding the legal standard applied in reviewing Nonqualified Deferred Compensation (“NQDC”) plans.
The 2021 guide provides updated guidance to examiners regarding legal standards to apply, with a particular emphasis on Section 409A. It also gives detailed examination technique instructions to examiners surrounding election forms, funding arrangements, and public company disclosure as well as outlines the penalties associated with noncompliance.
EXECUTIVE ORDER TO PROMOTE DE&I IN FEDERAL HIRING & TRAINING
An executive order signed on June 25, 2021 promotes diversity and inclusion in the federal hiring and training of a wide range of groups that have historically faced employment discrimination and professional barriers. The executive order states that the initiative is intended to advance opportunities for persons of color, women, LGBTQ+ individuals, first-generation professionals and immigrants, individuals with disabilities, Americans living in rural areas, older Americans who face age discrimination when seeking employment, parents and caregivers who face employment barriers, people of faith who require religious accommodations at work, individuals who were formerly incarcerated, and veterans and military spouses.
For additional details, see the D&I Executive Order Fact Sheet.
STATE COMPLIANCE UPDATES
Certificate of Second Chance Requirements Eased
Effective August 27, 2021, HB 2067 will allow individuals convicted of certain criminal offenses the opportunity to set aside a prior conviction and seek a Certificate of Second Chance that prevents them from being barred from employment opportunities, occupational licenses, and housing if otherwise qualified.
Collection of Union Dues or Benefit Contributions Restricted
Effective September 29, 2021, unions are prohibited from collecting union dues or benefit contributions from employees who are not union members and have not given written consent. In addition, an employee who is a union member or their employer is not obligated to pay union dues or benefit contributions if the union has not complied with state financial reporting requirements.
Glendale Expands Discrimination Protections
Effective August 27, 2021, a new Glendale ordinance protects LGTBQ+ individuals and families from discrimination in places of public accommodation, employment and housing within the city’s limits. In addition to gender identity and sexual orientation, Glendale’s new ordinance also prohibits discrimination because of race, color, ethnicity, national origin, age, disability, religion, sex, gender, veteran status, marital status, genetic information and familial status.
The Glendale ordinance applies to employers with five or more employees.
Tucson Adopts Crown Act
The City of Tucson has adopted the CROWN Act to protect individuals from discrimination based on their hair texture and style, including protective styles such as braids, locs, twists, and knots in the workplace and public schools. “CROWN” stands for “Creating a Respectful and Open World for Natural Hair.”
Firearms Transport Protections Expanded
Effective July 30, 2021, a new law states that a private employer may not prohibit an employee from transporting or storing a legally owned firearm in the employee’s private vehicle in the private employer’s parking lot nor prohibit or attempt to prevent an employee from entering the parking lot because the employee’s vehicle contains a firearm. While an employee is still required to store the firearm out of sight in a locked vehicle, it does not now need to be stored in a locked personal handgun container.
Penalties for Meal and Rest Break Violations Redefined
In the recent case Ferra v. Loews Hollywood Hotel, LLC, the California Supreme Court ruled that premiums for violations of meal, rest, and recovery periods must be paid at the “regular rate of pay” rather than the base hourly rate.
California employers are required to provide one hour of pay for each meal or rest break that was not provided. The ruling establishes that the calculation of this pay for meal and rest break violations must include an employee’s hourly wage rate plus any non-discretionary pay earned over the pay period, including non-discretionary bonuses, commissions, piece-rate compensation, or shift differentials.
The decision applies retroactively, and the statute of limitations for meal and rest break liability is up to four years.
Los Angeles County Mask Order Reinstated
Effective on July 18, 2021, an LA County Health Department Emergency Order reinstates a mask requirement for most indoor settings. The order requires masks for all persons, regardless of vaccination status, in “all indoor settings, venues, gatherings and businesses.” Indoor businesses open to the public must require all customers to wear masks, regardless of vaccination status, and must post notices to that effect. The order will continue until further notice.
The only exemption to mask-wearing in the workplace applies to employees who perform certain tasks that cannot be performed while wearing a mask, for the period of time in which such tasks are to be performed. Those employees must be tested for COVID-19 twice per week unless they provide proof of being fully vaccinated.
For additional details, see the Emergency Order.
Retroactive Vaccine Leave Mandated in Los Angeles
Effective retroactively from January 1, 2021 through September 30, 2021, an Emergency Order issued by the City of Los Angeles requires all employers to provide COVID-19 vaccine-related leave to employees who work within the City of Los Angeles and have been employed for at least 60 days. The leave includes the travel time to and from the vaccine appointment, time spent receiving the injection, and any recovery needed due to vaccine side effects that prevent an employee from working or teleworking.
Employees who work for employers with 25 or fewer employees are eligible for up to four hours of COVID-19 vaccine leave for each COVID-19 vaccine injection and up to eight hours of COVID-19 vaccine leave to recover from any vaccination-related side effects. Part-time employees are eligible for a prorated amount of leave based on their average number of hours worked in the preceding 60 days.
Employees who work for employers with more than 25 employees are eligible for the vaccine leave only after they exhausted all available supplemental paid sick leave benefits.
Employees who took COVID-19 vaccine-related leave since January 1, 2021 and who received less leave than the amount required in the order or who used other categories of leave such as paid sick leave or vacation may request retroactive pay for any difference. Any restored balance, as well as remaining hours of COVID-19 vaccine-related leave, should be reflected on employees’ wage statements.
Santa Clara County Phasing Out COVID-19 Employer Requirements
Effective June 21, 2021, businesses in Santa Clara County are no longer required to follow up every two weeks with employees who are not fully vaccinated, as long as they can show that they documented the status of employees who were not fully vaccinated for at least two rounds of two-week periods. Businesses that have not completed two rounds must continue complying with the order until they have completed two rounds.
Also, effective June 21, 2021, Santa Clara County lifted its requirements regarding mandatory reporting of personnel who contracted COVID-19, its Mandatory Directive on Use of Face Coverings, and its Mandatory Directive on Unvaccinated Personnel.
Businesses must continue to comply with any applicable statewide requirements, such as the Cal/OSHA Emergency Temporary Standards.
For additional details, see the Santa Clara Order.
Discrimination Based on Gender Identity and Expression Prohibited
Effective September 11, 2021, HB 21-1108 – known as the Colorado Anti-Discrimination Act (“CADA”) — broadens the categories of protected classes under Colorado’s anti-discrimination act to include gender identity and gender expression.
Gender identity is defined as an individual’s innate sense of gender, which may or may not correspond with the individual’s sex assigned at birth. Gender expression is defined as an individual’s way of reflecting and expressing gender to the outside world, typically demonstrated through appearance, dress and behavior.
Veterans’ Hiring Preference Allowed
Effective September 21, 2021, HB 21-1065 allows but does not require private employers to give preference in hiring to certain eligible individuals including veterans of the armed forces, members of the military reserves, veterans of the National Guard, or spouses of a disabled veteran or a service member killed in the line of duty.
Any veterans’ preference hiring policies must be in writing and implemented at least 14 days before it is applied to a posting or hiring decision, must be applied uniformly to all hiring decisions, must require certain proof that the individual is eligible, and must be applied to eligible individuals who are “as qualified as other applicants for employment.”
Independent Contractors New Hire Reporting
Effective July 1, 2021, the definition of “employee” includes a self-employed or contracted employee. This means that employers are now required to report their compensation to the IRS and the required information to the state directory of new hires.
New Insulin Bill Passed
Passed on July 6, 2021, HB21-1307 — called the Insulin Bill — creates a program limiting the cost of insulin to a maximum of $50 per month for Colorado residents not eligible for Medicare or Medicaid and not covered by the price cap of health insurance plans regulated by the state. The $100 cap on out-of-pocket costs is intended to cover the total monthly cost of insulin, even if a person has multiple prescriptions. Some insurance companies had interpreted it as a $100 limit per prescription, meaning their customers paid two or three times as much as lawmakers intended.
Up to once each year, people who have less than seven days of insulin left and need an emergency supply can receive one month’s supply for $35.
Pay Range Disclosure Required
Effective October 1, 2021, HB 6380 — called An Act Concerning the Disclosure of Salary Range for a Vacant Position requires employers to disclose the wage range for vacant positions to both job applicants and existing employees.
Under the new law, Connecticut employers are required to provide an applicant the wage range for the position for which he or she is applying, either upon the applicant’s request or at the time the applicant is made an offer – whichever comes first. Employers are also required to provide an employee the wage range for his or her position upon hire, a change in position, or upon request.
“Wage range” can include reference to pay scales, previously determined wages for the position, actual ranges for the employees who currently hold a comparable position, or the employer’s budgeted amount for the position.
The new law also extends the prohibition on gender-based compensation discrimination to comparable as opposed to equal work. Determining whether work is comparable requires a review of various factors including “a composite of skill, effort and responsibility.” The new law makes clear that geographic location, credentials, skills, education, and training may be bona fide factors other than gender upon which employers may make compensation decisions.
Inquiries into Job Applicants’ Age Banned
Effective October 1, 2021, An Act Deterring Age Discrimination in Employment Applications prohibits Connecticut employers with at least three employees from inquiring into the age of prospective employees.
Employers may not ask prospective employees their age, date of birth, or dates of attendance at or graduation from an educational institution.
They may, however, request or require such information if the request or requirement is based on a bona fide occupational qualification or need or if the employer has a need for such information to comply with applicable state or federal laws.
Portability of Sexual Harassment Prevention Training
As mentioned in previous Legal Updates, the deadline for employers to provide sexual harassment prevention training to all supervisors was May 20, 2021. Employers with three or more employees must provide the training to all employees as well.
However, if compliant training has previously been provided since October 1, 2018, employers are not required to provide the training and education a second time.
Effective October 1, 2021, this prior training includes training received while employed by a different employer.
Training resources and a required posting notice can be downloaded here: CHRO Portal.
Additional Protections for Breastfeeding Workers
Effective October 1, 2021, a new law adds additional protections for breastfeeding workers. Connecticut law already requires all employers to make reasonable efforts to provide a room or other location in close proximity to the work area, other than a toilet, where an employee can express milk in private. The new law requires the room or location to be free from intrusion and shielded from view while in use. It must also include or be situated near a refrigerator or employee-provided portable cold storage device in which the employee can store breast milk as well as access to an electrical outlet.
Unpaid Time Off to Vote
Effective immediately through June 30, 2024, employers are required to provide employees with two hours of unpaid time off to vote.
The unpaid leave from an employee’s regularly scheduled work must be provided upon request on the day of any state election or when an employee is an elector in a special election for United States senator, representative in Congress, state senator, or state representative. Employees must request time off not less than two working days prior to the election.
Recreational Cannabis Legalized but Can Be Prohibited by Employers
An Act Concerning Responsible and Equitable Regulation of Adult-Use Cannabis, which permits individuals 21 and older to possess and use recreational cannabis, was enacted on June 22, 2021. Effective July 1, 2022, employers may implement a written policy prohibiting cannabis possession or recreational use or consumption by employees.
Such a policy, which would not apply to qualifying medical cannabis patients, must be distributed to current employees prior to the enactment of the policy and to prospective employees at the time the employer makes an offer of employment.
Paid Family Medical Leave Act
Effective July 1, 2021, an employer must provide written notice of Paid Family Medical Leave rights to all new employees at the time of hiring and annually thereafter.
New Recall and Retention Obligations on Hospitality and Food Service Contractors
Effective July 13, 2021, An Act Requiring Employers to Recall Certain Laid-Off Workers in Order of Seniority imposes recall and retention obligations on hotels, lodging houses, food service contractors, and building services enterprises that have 15 or more employees in Connecticut, regardless of whether the employees are covered by a collective bargaining agreement.
Under the new law, a covered employer that has an available job opening must first offer the position to its laid-off employees who are qualified for the position. A laid-off employee is deemed qualified for a position if the employee held the same or a similar position at the time of the most recent separation from active service with the employer or could become qualified through the same training that would be provided to a new hire. Within five days after a position becomes available, the employer must send written notification about the opening to each of its laid-off employees who are qualified for the position. The notification must be sent to each laid-off employee’s last known physical address or email address. If the employer has cell phone numbers for laid-off employees, it must notify them by text message as well.
The Act extends recall rights to laid-off employees who were employed by a covered employer for at least six out of the twelve months preceding March 10, 2020 and whose most recent separation from active service, or whose failure to be scheduled for customary seasonal work by the employer, occurred between March 10, 2020 and May 1, 2022 and was due to a lack of business, reduction in force, or furlough due to the COVID-19 pandemic.
The offered employment must be at substantially the same employment site where the laid-off employee worked previously unless that site has moved to another location more than 25 miles away. If the offered position is the same or similar to the laid-off employee’s previous position, the offer must be in the same classification or job title and have substantially the same duties, compensation, benefits, and working conditions that applied to the employee immediately prior to March 10, 2020.
When more than one laid-off employee is qualified for an open position, the job must be offered first to the one who has the most seniority in terms of length of service at the employment site. The employer must give a laid-off employee at least five days to accept or reject an offer of rehire. If the laid-off employee who has the most seniority rejects the offer or fails to respond within that timeframe, the employer can extend the offer to the qualified, laid-off employee who has the second most seniority. If that person rejects or fails to respond to the offer, the employer can extend it to the qualified, laid-off employee with the third most seniority, and so on. However, if a laid-off employee declines an offer of rehire due to underlying conditions related to contracting COVID-19 diagnosed on or before May 1, 2021, the employee will retain the right to accept an available position for which that person is qualified.
If a covered employer declines to rehire a laid-off employee due to that person’s lack of qualifications and instead hires someone other than a laid-off employee, the employer must provide the laid-off employee with a written notification stating the reasons for its decision within 30 days. In addition, a covered employer that lays off any rehired employee prior to May 1, 2022 must state its reasons in an affidavit submitted to the Connecticut Department of Labor within 30 days after the layoff.
A laid-off employee who has been rehired cannot be discharged during the first 30 working days after that employee’s rehire, except for just cause. If a covered employer terminates, refuses to rehire, or takes any other adverse action against a laid-off employee, the employer must provide the employee with a detailed written statement of the reasons for the action, including all facts known to the employer that either support or contradict its reasons.
The new law applies even if the form of organization of the employer changed after March 10, 2020, if substantially all of the employer’s assets were acquired by another entity that conducts the same or similar operations using substantially the same assets, or if the site where a laid-off employee had worked prior to March 10, 2020 has been relocated to another site within 25 miles.
The new law has strong non-retaliation provisions that prohibit a covered employer from terminating, refusing to reemploy, reducing compensation, or taking any other adverse action against anyone for asserting rights under the Act, for opposing violations of the Act, or for participating in proceedings related to the law’s requirements.
Minimum Wage Increases
Effective September 30, 2021, the minimum wage in Florida increases to $10.00 per hour. The minimum wage for tipped employees increases to $6.98 per hour plus tips.
The minimum wage then will increase by $1 each year until it reaches $15 an hour in 2026. The minimum wage rate applies to all public and private sector employers, regardless of size or number of employees.
Corporate Espionage Protections
Effective October 1, 2021, the Combating Corporate Espionage in Florida Act establishes a second-degree felony for any person who traffics in trade secrets and clarifies that a trade secret can include information or documents stored in electronic form. The Act also requires Florida courts to order restitution when a person steals or traffics a trade secret and establishes the right for trade secret owners to seek injunctive relief.
“Disability Subminimum Wage” Repealed
Effective June 16, 2021, Senate Bill 793 repeals an exemption to the minimum wage for disabled employees, often referred to as the “disability subminimum wage.” As a result, all Hawaii employers are required to pay disabled individuals no less than the state minimum wage.
Equal Pay Certification Process and Deadline Amended
Retroactively effective March 23, 2021, new amendments to the Equal Pay Act of 2003 modify the requirements and deadline for applicable employers to obtain an equal pay registration certificate.
Businesses with more than 100 employees must obtain an equal pay registration certificate from the Department of Labor between March 24, 2022, and March 23, 2024.
To obtain the certificate, applicable businesses are required to pay a $150 filing fee and submit an application containing a statement to the Department of Labor affirming compliance with the equal pay principles set forth in Title VII of the Civil Rights Act, the Equal Pay Act of 1963, the Illinois Human Rights Act, the Equal Wage Act, and the Equal Pay Act of 2003.
The statement, signed by an officer or agent of the business, must affirm that:
the average compensation for the business’s female and minority employees is not consistently below the average compensation for its male and non-minority employees within major job categories when accounting for various distinguishing factors;
the business does not restrict certain genders to specific roles and makes employment decisions without regard to sex; and
wage and benefit disparities are corrected by the business when identified.
In addition, businesses that are required to file a federal EEO-1 report must also include a copy of their most recent EEO-1 report and must submit a wage records list of all employees in the past calendar year. The list must include:
gender and race / ethnicity of each employee;
wages paid to each employee over that period;
each employee’s employment start date; and
“any other information the Department of Labor deems necessary to determine if pay equity exists” (yet to be defined).
Current employees of a business subject to the equal pay registration certificate requirements may request “anonymized” data regarding their job classification and the pay for that classification.
Employers with fewer than 100 employees must certify in writing to the Department of Labor that they are exempt.
Employers are required to describe the “approach” used to determine wages, but the employer is not required to select from any specific system. Instead, the statute states that “acceptable approaches include, but are not limited to, a wage and salary survey.”
The new law authorizes a penalty of $10,000 per violation if applicable businesses fail to comply with the equal pay registration certification requirements. However, a 30-day grace period is allowed to correct an inadvertent failure to file an application or to cure deficiencies in an application for the equal pay registration certificate.
Penalties for Wage & Hour Violations More than Doubles
Effective July 9, 2021, an amendment to the Illinois Wage Payment and Collection Act increases the penalty for underpaying wages from 2% of the amount of the underpayment per month to 5%.
Cook County Minimum Wage Increase
Effective July 1, 2021, the Cook County minimum wage for tipped employees will increase from $6.00 to $6.60. Despite written notices from Cook County that some employers may have received, the Cook County Minimum Wage for non-tipped employees is not increasing and will remain at $13.00 per hour.
Employers must post a notice of the updated minimum wage rates. The most up-to-date posting notice can be found in the “Downloads” section of the Cook County Minimum Wage Regulations web page.
Since many municipalities in Cook County opted out of the Cook County Minimum Wage ordinance, businesses in Cook County (but not the City of Chicago) should check whether or not their municipality opted out.
Chicago Minimum Wage Increases
Also, effective July 1, 2021, the minimum wage rates for City of Chicago employers will increase. The minimum wage rate is $15.00 per hour for Chicago employers with more than 20 employees. The minimum wage rate is $14.00 per hour for employers of domestic workers with 20 or fewer employees and all other Chicago employers with between 4 and 20 employees.
The minimum wage rate is $8.40 for tipped workers of employers with 4 to 20 workers, and $9.00 for tipped workers of employers with more than 20 employees. If a tipped worker’s wages plus tips do not equal at least the full minimum wage, the employer must make up the difference.
Workers under 18 or those under a subsidized temporary youth employment program or transitional employment program can be paid a minimum wage rate of $11.00 per hour, or $6.60 per hour if a tipped youth worker.
For employers under City of Chicago contracts and concessionaire agreements, the minimum wage rates are $14.15 for non-tipped employees and $7.65 for tipped employees.
Employers must post a notice of the updated minimum wage rates and distribute hard copy or electronic notices to employees. The most up-to-date posting notice can be found here: Minimum Wage Poster.
Chicago Implements New Wage Theft Protections and Amends Paid Sick Leave
Effective July 5, 2021, Ordinance No. O2021-2182 2021 creates new wage theft protections.
An employer is liable for wage theft where it fails to pay a covered employee in a timely manner. Wage theft includes the non-payment of any wages required for work performed, as well as paid time off and contractually required benefits. The employer may be held liable for the amount of any underpayments and damages of either 2% of the amount of any underpayments for each month following the date of payment during which such underpayments remain unpaid, or the amount specified by the Illinois Wage Payment and Collection Act — whichever is greater. These penalties are in addition to the penalties available to employees for an employer’s failure to comply with its Chicago paid sick leave obligations.
Effective August 1, 2021, the same ordinance modifies and expands the covered reasons for use of paid sick leave.
|Current Covered Reasons for Use||Covered Reasons for Use Effective August 1, 2021|
|The employee is ill or injured, or for the purpose of receiving medical care, treatment, diagnosis, or preventive medical care||The employee is ill or injured, or for the purpose of receiving processional care, including preventive care, diagnosis, or treatment, for medical, mental, or behavioral issues, including substance abuse disorders|
|A covered family member is ill or injured, or to care for a family member receiving medical care, treatment, diagnosis, or preventive medical care||A covered family member is ill or injured, or ordered to quarantine, or to care for a family member receiving professional care, including preventive care, diagnosis, or treatment, for medical, mental, or behavioral issues, including substance abuse disorders|
|The employee, or a covered family member, is the victim of domestic violence or a sex offense||The employee, or a covered family member, is the victim of domestic violence or a sex offense (stalking, aggravated stalking, cyberstalking)|
|The employee’s place of business is closed by order of a public official due to a public health emergency||(No Change)|
|The employee needs to care for a child whose school or place of care has been closed by order of a public official due to a public health emergency||The employee needs to care for a family member whose school, class, or place of care has been closed|
|(New Reason)||An employee obeys an order issued by the mayor, the governor of Illinois, the Chicago Department of Public Health, or a treating healthcare provider, requiring the employee: to stay at home to minimize the transmission of a communicable disease, to remain at home while experiencing symptoms or sick with a communicable disease, to obey a quarantine order issued to the employee, or to obey an isolation order issued to the employee|
|Federal Family and Medical Leave Act eligible purposes||(No Change)|
Employers must provide a copy of the City-created notice to employees with a paycheck issued within 30 days of July 1, 2021. The notice can be downloaded here: Chicago Posting Notice.
Chicago Hotel Workers Laid off during Pandemic Have Rights to be Rehired
Effective June 25, 2021 through December 31, 2023, Chicago’s Right to Return to Work ordinance requires Chicago hotels to rehire qualified employees laid off during the COVID-19 pandemic before hiring new employees.
The ordinance applies to all businesses in Chicago used or advertised as an inn, hotel, motel, or any similar business where sleeping accommodations are provided for a fee, and in which at least seven sleeping rooms are maintained for the accommodation of guests. The law does include some exceptions, such as those involving a change in licensees and licensees who move operations to a different location within Chicago.
A former hotel employee is protected by the ordinance if they:
worked with the hotel for at least six months within the 12-month period before they were laid off;
performed at least two hours of work for the hotel within the City of Chicago; and
were laid off on or after January 31, 2020 for a non-disciplinary reason.
A laid-off employee is considered qualified if they held the same or similar position at the hotel when laid off or if the job is within the same division or department of the hotel and the former employee can meet the position’s job requirements with training that would be provided for a new employee.
Hotels must first offer any open positions, in writing, to laid-off employees who held the same or similar position and then to those who can meet the job requirements with training that would be provided for any new employees. If more than one person is entitled to the position based on these guidelines, the position must be offered based on seniority.
Return-to-work offers must be made in writing and sent by registered mail to the former employee’s last known address, as well as by email and text message if that contact information is available.
A laid-off employee offered a position under the ordinance must be provided no fewer than five business days to decide whether to accept the offer to return. If a hotel decides not to provide a laid-off employee a position due to lack of qualifications, the hotel must provide that employee with written notice within 30 days, identifying the reasons for its decision.
Violators are subject to fines between $250 and $500 per offense, per day.
Criminalization of Defrauding a Drug or Alcohol Test
Effective July 1, 2021, a person who collects a urine sample from another person for a drug or alcohol test, having knowledge or reasonable suspicion that the other person has used synthetic urine or a urine additive, is allowed to report such information to law enforcement authorities. The rule applies to a drug or alcohol test given in a private-sector workplace or by a public employer.
Expansion of Protections for Military Members
Effective July 1, 2021, Iowa expands its military leave of absence and discrimination protections to any regular, reserve or auxiliary member of the U.S. Coast Guard.
Pregnancy Accommodations Expanded
Beginning August 1, 2021, Louisiana employers will be required to provide reasonable accommodations to employees due to pregnancy, childbirth, or related medical conditions, unless it would pose an undue hardship on the employer. Currently, employers are only required to provide accommodations if they accommodate others who are similar in their ability or inability to work.
Examples of possible reasonable accommodations provided in the law include:
Making facilities used by employees readily accessible to and usable by an applicant or employee;
Providing more frequent breaks;
Providing light duty, if available;
Acquiring or modifying equipment devices necessary for performing essential functions; and
Modifying work schedules.
The statute makes clear, however, that employers are not required to create positions that do not already exist (including light duty), unless the employer does so for other employees who need accommodations. Employers also are not required to discharge or move another employee to make any accommodations.
The statute prohibits an employer from refusing to select a pregnant worker for a training program leading to a promotion, as long as the employee can complete the program at least three months prior to her pregnancy leave. The statute further prohibits an employer from discharging a pregnant worker from employment or to discriminate against her in compensation or in the terms, conditions, or privileges of employment.
The new law does not change an employer’s existing obligations to provide a reasonable leave of absence of at least six weeks for a normal pregnancy or childbirth or for a period of time of up to four months that an employee is disabled due to pregnancy, childbirth, or related medical conditions.
Employers must provide existing employees with notice of the new requirements by December 1, 2021, and notification to all new employees at the commencement of employment. A model notice has not yet been published.
Discrimination Based on Criminal History Prohibited
Effective August 1, 2021, HB 707 prohibits discrimination by Louisiana employers based on criminal history and provides criteria in making hiring decisions in conjunction with criminal history records.
When making an assessment of whether an applicant’s criminal history has a direct and adverse impact on the specific duties of the job that may justify denying the applicant the position, the employer must consider:
the nature and gravity of the offense or conduct;
the time that has elapsed since the offense, conduct, or conviction; and
the nature of the job sought.
Employers may not request or consider an arrest record or charge that did not result in a conviction.
The new law also requires employers to provide the applicant with any background check information used during the hiring process, upon receipt of a written request by the applicant.
Federal Unemployment Benefit Subsidy Ending
Effective July 31, 2021, Louisiana will stop participation in federal pandemic-related unemployment benefit programs. The state will continue to pay regular state unemployment on approved claims, without the additional federal benefits.
Louisiana is the first state with a Democratic governor to end the $300 per week supplemental unemployment benefit created by the federal American Rescue Plan Act of 2021.
State FMLA Expanded to Include Grandchildren
Effective 90 days after the end of Maine’s current legislative session, L.D. 61 — called an Act to Include Grandparents Under Maine’s Family Medical Leave Laws – will expand the current FMLA leave to allow Maine employees to take job-protected unpaid leave to care for serious health conditions of their grandchild(ren) or their domestic partner’s grandchild(ren).
Maine’s FMLA applies to employers with 15 or more employees within one location in Maine. It requires covered employees to offer up to 10 weeks of job-protected, unpaid FMLA leave over a two-year period for qualifying reasons, and to allow employees to continue benefits during the leave period at the employee’s own expense. Employees must have been employed at least one year to be eligible for the job-protected leave and continuation of benefits.
Applicable reasons to use this leave include:
the birth of a child or adoption of a child 16 or younger;
the employee’s own serious health condition;
caring for the serious health condition of their parents, domestic partners, siblings, spouses, or their or their domestic partner’s children or grandchildren;
donation of an organ for human transplant; or
death or serious health condition of the employee’s spouse, domestic partner, parent, sibling, or child if the death or serious health condition occurs while on active duty in the U.S. military or state armed forces.
Direct Deposit Fees Prohibited
Effective September 15, 2021, an employer may not charge a fee to employees for the payment of wages by means of direct deposit.
Bereavement Leave Allowed under Maryland Flexible Leave Act
Effective October 1, 2021, an amendment to Maryland’s Flexible Leave Act expands the act to apply to bereavement leave. Employers with at least 15 employees must allow covered employees to use paid leave for bereavement purposes in the death of an immediate family member.
Peace Order Process Amended
Effective October 1, 2021, an amendment to the existing peace order process permits an employer to petition a court for a peace/restraining order on behalf of an employee based on acts or threatened violence against that employee in the employer’s workplace. The peace order may be issued on an interim, temporary, or final basis. The employer must notify the employee before seeking such a peace order.
The act or threatened violence must have occurred within 30 days before the filing of the petition.
Employers may not retaliate against an employee who does not provide information for or testify at a proceeding.
Mini-WARN Act Requirements Amended
Effective October 1, 2021, Maryland’s mini-WARN law is amended to apply to an employer that employs at least 50 employees anywhere, as long as the layoff or closure occurs in Maryland and the employer operates an industrial, commercial or business enterprise in the state.
The amendments also clarify that a reduction in operations includes:
The relocation of a part of an employer’s operation from an initial workplace to another existing or proposed site that may reduce the total number of employees at the initial workplace by at least 25% or 15 employees, whichever is greater, over any three-month period; or
The shutting down of a workplace, or a portion of its operations, that reduces the total number of employees by at least 25% or 15 employees, whichever is greater, over any three-month period.
Economic Stabilization Act Amendment
Effective October 1, 2021, amendments to the Maryland Economic Stabilization Act require employers with 50 or more employees operating an industrial, commercial, or business enterprise in Maryland for at least one year to provide advance, written notice of upcoming reductions in force.
Notice obligations under the act are triggered when a covered employer implements a “reduction in operations,” which is defined as:
The relocation of part of an employer’s operation from one workplace to another existing or proposed site; or
The shutting down of a workplace or a portion of the operations of a workplace that reduces the number of employees by at least 25 percent or 15 employees – whichever is greater, over any three-month period.
An employee may not be counted in the determination of a reduction in operations if the employee accepts an offer to transfer to any other site of employment within 30 days after being offered the transfer.
Covered employers must provide at least 60 days advance written notice of the reduction in operations to the following:
All employees at the workplace who are subject to the reduction in operations, including employees working on average fewer than 20 hours per week and individuals who have worked for the employer for less than six months in the immediately preceding 12-month period;
Each exclusive representative or bargaining agency that represents employees at the workplace who are subject to the reduction in operations;
The Maryland Workforce Development’s Dislocated Worker Unit; and
All elected officials in the jurisdiction where the workplace that is subject to the reduction in operations is located.
Drug Testing Provisions for Unemployment and Workers’ Compensation Claims
Effective July 1, 2021, an employee is disqualified for unemployment benefits after being discharged for failure to pass or refusal to take a drug test in violation of an employer’s written workplace drug policy, as long as the testing procedures comply with federal drug-testing statutes and regulations. This does not apply, however, to a drug test for marijuana or marijuana products that was administered to an individual who is a registered medical marijuana cardholder.
Further, if an employee fails or refuses to take a drug test after a workplace accident, there is a presumption that the major contributing cause of the accident was the employee’s use of drugs not prescribed by a physician. The employee therefore would not be eligible for workers’ compensation benefits.
Race Protections Extended
Effective September 11, 2021, race will be defined to include characteristics such as skin color, hair texture, and protective hairstyles including braids, locks, and twists.
An employer may only enact a bona fide health and safety standard that regulates characteristics associated with race if the employer demonstrates that:
without the implementation of such standard, it is reasonably certain that the health and safety of the applicant, employee, or other materially connected person will be impaired;
the standard is adopted for nondiscriminatory reasons;
the standard is applied equally; and
the employer has engaged in good faith efforts to reasonably accommodate the applicant or employee.
Paid COVID-19 Vaccination Leave Enacted and Leave Reasons Expanded
Effective May 29, 2021, SB 209 requires private employers in Nevada with 50 or more employees to provide paid leave for employees to receive a COVID-19 vaccine. This mandated leave is in addition to the 0.01923 hours of paid leave these employers are required to provide for each hour worked. The new law also clarified that employees may use existing paid leave to care for themselves and their family members.
Between May 29, 2021 and December 31, 2023, applicable employers must provide two consecutive hours of paid leave to employees who request leave to get a vaccination. For a two-shot vaccination, the employer must provide two consecutive hours per absence, for a total of four hours of paid leave. Leave requirements do not apply to employers that provide a clinic on their premises, where an employee may receive the vaccination during regular work hours, or to new employers within the first two years of operation.
Employees must give their employers advance notice of at least 12 hours to take the leave. Employers cannot deny an employee the right to use the paid leave or require an employee to find a replacement as a condition of using the leave. In addition, they cannot retaliate or take any adverse action against an employee.
Covered employers are required to retain records for each employee granted leave for at least one year. They are also required to post the SB 209 Bulletin.
Leave to Assist Family Members
Effective October 1, 2021, AB 190 requires employers that provide either paid or unpaid sick leave to allow employees to use a portion of that leave for the care of immediate family. The law applies to employers who offer sick leave separately from vacation / personal time as well as to those who combine vacation / personal time with sick leave into one leave category.
Under the law, “immediate family” is defined as the employees:
Child or foster child
Spouse or domestic partner
Parent, step-parent, or parent-in-law
Any person for whom the employee is the legal guardian
Provided sick leave may be used for an illness or injury, medical appointment, or other authorized medical need of either the employee or their immediate family members. Employers may limit the amount of sick leave used to care for family members to an amount equal to what the employee would accrue in a six-month period.
The law does not extend any amount of leave an employee may be entitled to under the Family and Medical Leave Act.
Covered employers are required to post the AB 190 Bulletin.
Non-Compete Law Amended
Effective October 1, 2021, AB 47 amends Nevada’s non-compete law to prohibit non-compete agreements from applying to hourly employees. The law does not appear to affect covenants with hourly employees who also receive bonuses, profit sharing, or commissions.
The new law also prohibits covenants that restrict a former employee from providing services to a former customer or client if:
the former employee did not solicit the former customer or client;
the customer or client voluntarily chose to leave and seek services from the former employee; and
the former employee is otherwise complying with the limitations in the non-compete covenant as to time, geographical area and scope of activity to be restricted.
If a court finds a challenged covenant to be unlawful because it applies to an hourly worker or wrongfully restricts former employees, the court is required to award the employee their reasonable attorneys’ fees and costs.
Hairstyle Discrimination Prohibited
Effective June 2, 2021, SB 327 prohibits discrimination in the workplace on the basis of traits historically associated with race, including hair texture and protective hairstyles.
“Protective hairstyles” include natural hairstyles such as afros, Bantu knots, curls, braids, locs, and twists.
Wrongful Termination Claims Must Be Brought within Two Years
Effective May 27, 2021, SB 107 limits the statute of limitations for filing wrongful termination claims to within two years of the termination date. Nevada law previously did not specify a statute of limitations for such claims.
Wage Garnishment Procedures Amended
Effective October 1, 2021, AB 37 amends wage garnishment procedures that are due to a child support order.
Under the new law, an employer who is planning to issue a lump-sum payment of $150 or more to an employee who is under a child support wage garnishment order must inform the garnishment enforcing authority at least 10 days before the intended payment date. Lump-sum payments include commission payments, discretionary and non-discretionary bonuses, incentive payments for moving or relocation, severance payments, or any other one-time payment of compensation.
Once notified, the Division of Welfare and Supportive Services of the Department of Health and Human Services (DWSS) will be required to provide written notice to the employer of the amount of the lump-sum payment that the employer must garnish.
An employer is prohibited from releasing the lump-sum payment before the earlier of the scheduled release date, the eleventh day after the employer informed the enforcing authority of its intention to release a lump-sum payment or the date that the employer receives written notice from DWSS.
Salary History Inquiries Banned and Wage Ranges Required
Effective October 1, 2021, SB 293 prohibits an employer or an employment agency from asking the salary history of an applicant, from discriminating against an applicant for not revealing salary history, and from relying on an applicant’s voluntarily provided salary history. An employer or employment agency may, however, ask an applicant about the expected or targeted pay rate or range.
Also effective October 1, 2021, Nevada employers will be required to provide pay rate or range information to applicants upon completion of an interview and to employees who interview for or are being offered a promotion or transfer.
The requirements of the law do not apply to applicants or employees working outside of Nevada.
Inclusive Single-Stall Restrooms Required for Places of Public Accommodation
Effective October 1, 2021, AB 280 requires places of public accommodation with a single-stall restroom to make the restroom as inclusive and accessible as possible to a person of any gender identity or expression. The new law prohibits applicable single-stall restrooms to be labeled with signage that indicates the restroom is for a specific gender.
Places of public accommodation refer to any establishment or place to which the public is invited or which is intended for public use. Examples include inns, hotels, motels, restaurants, bars, gas stations, theaters, grocery stores, laundromats, museums, libraries, parks, private schools or universities, daycare centers, gyms, and health spas.
Applicable single-stall restroom must allow a parent or guardian of a child to enter the single-stall restroom with the child; a person with a disability to enter the single-stall restroom with his or her caregiver, if applicable; and a person of any gender identity or expression to use the single-stall restroom as needed.
Cannabis Criminal Background Protections
Effective August 1, 2021, New Jersey employers are prohibited from inquiring about or taking adverse action against an applicant based on certain cannabis-related offenses.
Further, employers may not require applicants to disclose or reveal cannabis-related arrests, charges, convictions or adjudications.
Increased Penalties For Misclassification of Independent Contractors
Effective July 8, 2021, A-5890/S3920 increases penalties to employers for misclassifying employees as independent contractors. Under A-5890/S3920, the Commissioner of the NJDOL is authorized to shut down a business when the employer commits even just a single violation of a state wage, benefit, or tax law. These stop-work orders may remain in effect until the employer has come into compliance and paid all assessed penalties. Employees affected by such stop-work orders must be paid by the employer for the first ten days of missed work because of the stop-work order. In addition, the Commissioner may assess a civil penalty of $5,000 per day against an employer that continues to operate in violation of the stop-work order. A-5890/S3920 also permits the Commissioner to seek a superior court injunction against employers to prevent ongoing violations of state wage, benefit, and tax laws arising from employee misclassification.
Effective February 1, 2022, A-5892/S3922 mandates that misclassifying employees as independent contractors to evade payment of insurance premiums will be a violation of the New Jersey Insurance Fraud Prevention Act (“NJIFPA”) and subject to penalties of $5,000 for the first violation, $10,000 for the second violation, and $15,000 for each subsequent violation.
New York City Ban-the-Box Law Amended
Effective July 29, 2021, New York City’s Fair Chance Act enacts further restrictions on employers’ use of criminal background information.
The amended law requires employers to evaluate the relationship between convictions (whether they occur before or during employment) and the employment sought. It also applies to arrests and pending criminal charges for employees and applicants.
The law also contains procedural and notice requirements for employers that intend to take adverse action based on criminal background information and prohibits inquiries into certain categories of criminal background information.
Employers may take the adverse action only after considering the fair chance factors and identifying either a direct relationship between the criminal conduct or alleged wrongdoing and the employment sought or held or unreasonable risk to property or to the safety or welfare of specific individuals or the general public.
Deadline to Comply with NY HERO Act Pushed Again
The deadline for New York employers to comply with the New York Health and Essential Rights Act, also known as the NY HERO Act, has been pushed again from July 5, 2021 to August 5, 2021. The Act requires all employers in New York to either adopt one of the model standard exposure prevention plans applicable to their industry or develop and establish an alternative prevention plan that meets or exceeds the minimum standards.
After adopting a plan, employers will then have to provide their written exposure prevention plan to employees in English and the primary languages of their employees — if a translation is made available by the NYSDOL, no later than September 4, 2021. Employers must provide all employees with their exposure prevention plan no later than September 4, 2021, or upon reopening and to new hires on the date of hire. The Prevention Plan must also be posted in a visible and prominent location within the worksite, be included in the employee handbook (if applicable), and be available for review upon request.
In addition, effective November 1, 2021, the new law will require employers with at least 10 employees to allow the creation of a joint employer-employee workplace health and safety committee.
The Commissioner of the New York Department of Labor has released industry-specific standards to prevent exposure to all airborne infectious diseases in the workplace, available here: Model Prevention Plan.
New Biometric Information Posting Notice for Some New York City Businesses
Effective July 9, 2021, applicable retail and hospitality businesses that collect and use “biometric identifier information” such as retina or iris scans, fingerprints, voiceprints, or scans of hand or face geometry from customers will need to post conspicuous notices near all customer entrances to their facilities. These businesses will also be prohibited from selling, leasing, trading, sharing or otherwise profiting from the biometric identifier information they collect from customers.
Covered businesses include food and drink establishments; places of entertainment such as theaters, stadiums, arenas, racetracks, museums, amusement parks, observatories, or other places where attractions, performances, concerts, exhibits, athletic games or contests are held; and retail stores.
The required notice can be downloaded here: Biometric Disclosure Sign.
New York City Enforces Fair Work Practices Ordinances’ Wrongful Discharge Provisions
Effective September 2, 2021, fast food workers covered under the Fair Work Practices Ordinances may receive protections against wrongful discharge and reverse seniority provided under the ordinances.
Wage Notice Changes
Effective July 8, 2021, employers must provide a written offer of promised wages at the time of hire and give notice at least one pay period prior to making any decreases in wages of existing employees. Wages may be retroactively increased without prior notice.
In addition, employees whose employment is ending must submit a request in writing if they want their final paycheck mailed to them, and the paycheck must be sent using trackable mail.
Unemployment Benefits Allowed for Military Spouses
Effective August 1, 2021, unemployment insurance benefits will not be denied if a military spouse voluntarily leaves work to relocate because of their spouse’s permanent change of station orders. Exceptions may apply if the employer attempts to make accommodations.
Reemployment Rights for Service Members
Effective 91 days after the 2021 legislative session adjournment, HB 2231 provides exceptions to the five-year limit on reemployment rights for military service members after leave.
The new law excludes the following circumstances from the five-year limit calculation:
If imposed by law;
due to inability of the officer or employee to obtain orders relieving the officer or employee from active duty;
voluntary service overseas; or
voluntary service within the United States during or in response to an emergency or disaster declared by local, state or federal government.
Temporary Changes to Oregon’s Equal Pay Act
Retroactively effective to April 29, 2021, provisions of HB 2818 exempt vaccine incentives provided during a public health emergency from the definition of “compensation” in Oregon’s Equal Pay Act. This includes both monetary and nonmonetary incentives, including additional paid time off.
Retroactively effective to May 25, 2021, other provisions of HB 2818 temporarily exempt hiring bonuses offered to prospective employees and retention bonuses offered to existing employees from the definition of “compensation” in Oregon’s Equal Pay Act. This amendment is only in effect until March 1, 2022.
Under existing Oregon law, employers must ensure that employees performing “work of comparable character” receive equal “compensation,” unless the difference can be justified by specific factors listed in the statute.
Oregon OSHA Issues Temporary Heat Rule
The Oregon Occupational Health and Safety Administration (“OR OSHA”) has issued a temporary rule to address employees’ exposure to the hazards posed by temperatures in excess of 80 degrees.
The rule applies whenever employees are required to work in conditions in which the heat index reaches 80 degrees or higher — either outdoors or indoors.
Employers must provide employees with access to shaded areas, as close as practical to the worksite, which are ventilated either naturally or mechanically. The shaded areas must be large enough to allow employees to sit and must accommodate employee meal periods.
Employers must also provide readily accessible, potable drinking water or certain kinds of sports drinks that is 77 degrees or colder and in sufficient amounts to allow each employee to consume one gallon of water per hour, as well as the opportunity for employees to drink that gallon of water each hour.
Beginning on August 1, 2021, employers that reasonably anticipate that employees will be exposed to heat index temperatures of 80 degrees or more must provide and document training to their supervisors and employees on a variety of subjects related to working in the heat, including the personal risk factors for heat-related illness.
Additional safety requirements are required when the heat index reaches 90 degrees or higher. During these “high heat” periods, employers must:
- maintain effective voice communication with employees,
- monitor employees for signs of heat-related illness,
- designate at least one employee per worksite to call for emergency services as necessary,
- ensure that employees take a minimum ten-minute cool-down rest period in the shade at least every two hours (which may be combined with meal or rest periods),
- develop and implement emergency medical plans that outline the steps they will take to provide care to employees who exhibit signs of heat-related illnesses, and
- develop “acclimatization practices,” the process by which employees temporarily adapt to working in high temperatures.
Pennsylvania Remote Employees Must Now Use Home Location for Tax Purposes
Effective July 1, 2021, an employee working remotely from his or her home must treat the home location as the work location for corporate net income tax and sales tax nexus purposes. Previously, the Pennsylvania Department of Revenue had announced that remote work by employees as the result of the pandemic would effectively be disregarded for Pennsylvania tax purposes.
The change impacts Pennsylvania residents working out of state as well as non-residents working in Pennsylvania unless the state has tax reciprocity.
Employers with employees based in Philadelphia should note that the Philadelphia Department of Revenue guidance slightly differs from the Pennsylvania Department of Revenue requirement. The Philadelphia Department of Revenue has historically utilized a “convenience of the employer” rule under which non-resident employees who are based in Philadelphia are subject to Wage Tax unless they are working remotely for the convenience of their employer. When employees work from home because of an employer, their wages are only subject to wage taxes for the time spent actually working in Philadelphia. However, if they are working from home purely voluntarily, the interpretation of the Philadelphia Department’s guidance is that non-resident employees based in Philadelphia are subject to tax on all wages, even if such employees elect to work remotely for a substantial portion of time.
Effective June 10, 2021, the business activity of an employee working remotely from home in Philadelphia will determine whether receipts are taxable for Business Income & Receipts Tax (“BIRT”) and Net Profits Tax (“NPT”) purposes. In addition, effective July 1, 2021, a business entity will be considered to have nexus for BIRT net income tax purposes when it has one or more employees conducting business activities on its behalf in Philadelphia. If a business has employees working remotely from home from within Philadelphia, those employees will be sufficient to cause an employer to be subject to BIRT unless its activities are protected. For additional details, see the Philadelphia Department’s announcement.
Philadelphia and Pittsburgh Paid Sick Leave Laws Expired
On June 10, 2021, Pennsylvania’s legislature voted to end the Governor’s Proclamation of Disaster Emergency. While certain pandemic-related waivers of state regulations stay in place through September 30, 2021 — including the emergency authorization of telemedicine and temporary extra staffing at nursing homes and other healthcare facilities, temporary emergency paid sick leave laws in Pittsburgh and Philadelphia have expired.
Employers in Philadelphia and Pittsburgh should notify employees that the paid leave once required under the Public Health Emergency Leave Law is no longer available.
Increase to Exemption Salary Threshold Repealed
The governor has repealed an increase to the minimum salary requirements for a white-collar exemption that was set to take effect October 3, 2021.
An employee in Pennsylvania classified as exempt under a white-collar exemption must earn at least $684 per week ($35,568 annually), instead of the previously passed threshold of $780 per week.
Restrictive Covenants for Health Care Providers Banned
Effective July 1, 2021, restrictive covenants for health care providers are banned in South Dakota. The ban does not, however, apply to a contract in connection with the sale and purchase of a practice.
Rights to Bar Firearms and Weapons in the Workplace Remains Unchanged
Effective July 1, 2021, Tennessee’s Constitution Carry law allows military members between ages 18 to 20 and other individuals over the age of 21 to carry a firearm, both concealed and open, with or without a carry permit. However, this new law does not impact a private Tennessee business’ right to prohibit the possession of weapons on its property, if the business displays the required notice and allows individuals to store the firearm within his or her vehicle under Tennessee’s Guns in Trunks law.
Proof-of-Vaccination Banned for Customers
Effective June 16, 2021, Texas businesses are prohibited from requiring that individuals visiting the business present proof of vaccination before entering. The law does not, however, prohibit employers from requiring proof of vaccination from their employees. The Texas law also does not limit a company’s right to continue offering incentives to those who are vaccinated, as long as customers voluntarily provide their health information.
Businesses Shielded from COVID-19 Liability
Effective retroactively to all legal actions commenced on or after March 13, 2020, SB 6 grants civil liability protections for businesses as well as health care providers and first responders subjected to COVID-19-related injury and death lawsuits. The protections will continue until the current pandemic-related disaster declaration is terminated.
SB 6 establishes a civil liability shield for businesses of all sizes against claims of injury or death from exposure to pandemic disease, regardless of whether the person harmed is an employee or a third party on the business’ premises. A claim may, however, be brought for a pandemic-related injury or death if the business knowingly failed to warn the individual of or fix a condition within the business’ control if failure to warn or fix the condition was the cause in fact of the individual contracting the disease. The protections would also not apply if the business knowingly failed to implement, refused to comply with, or acted in flagrant disregard of the standards, guidance, or protocols put forth by the government, and this failure or refusal to comply was the cause in fact of the individual contracting the pandemic disease.
SB 6 also extends protections to physicians, health care providers, and first responders defending against an injury or death lawsuit if they show a pandemic disease or disaster declaration was a producing cause of the care, treatment, or failure to provide care or treatment that allegedly caused the injury or death, or if the individual who suffered injury or death was diagnosed with or reasonably suspected to be infected with a “pandemic disease” at the time of the challenged care, treatment, or failure to provide care or treatment. These protections will not apply if the physician, health care provider, or first responder is shown to have acted negligently, recklessly, intentionally, willfully, or wantonly to bring about the complaint of harm.
Firearm Carry Law Amended
Effective September 1, 2021, the Firearm Carry Act will allow individuals in Texas who are at least 21 years old to carry a handgun without a permit or license, unless the individual is otherwise prohibited from carrying a firearm under state or federal law.
Employers can still prohibit handguns on their premises if they post the appropriate notice.
Sexual Harassment Law Broadened
Effective September 1, 2021, SB 45 expands the definition of “employer” in reference to sexual harassment liability. Any employer that employs one or more employees or that “acts directly in the interests of an employer in relation to an employee” will be considered an employer under Texas law and subject to a heightened level of scrutiny for sexual harassment claims. The current law shields employers with fewer than 15 employees from liability regarding sexual harassment claims.
The amended law also raises the standard of “unlawful employment practices” in relation to sexual harassment claims. An employer will be considered to be in violation of the amended law if sexual harassment of an employee occurs and the employer or the employer’s agents or supervisors knew or should have known that the conduct was occurring and failed to take immediate and appropriate corrective action.
Also effective September 1, 2021, HB 21 extends the statute of limitations for making sexual harassment claims from 180 days to 300 days from the date of the alleged harassment.
Data Breach Notification Law Amended
Effective September 1, 2021, businesses that experience a data breach must now include the number of affected residents that have been sent a disclosure of the breach in the data breach notice that is required to be sent to the state attorney general.
Dallas Paid Sick Leave Ordinance Enjoined
The Dallas paid sick leave ordinance requiring employers with five or fewer employees to grant paid sick leave that was going to into effect August 1, 2021 has been permanently enjoined.
Accommodation Policies Required for Employees with Disabilities
Effective July 1, 2021, Virginia employers with five or more employees must include information in their employee handbooks about reasonable accommodations for persons with disabilities. This information must also be posted in a conspicuous location, provided to all new employees, and provided directly to any employee within 10 days after receiving notice that the employee has a disability.
The model notice can be downloaded here: Reasonable Accommodation Notice.
Prevailing Wage Mandated for State Contractors and Subcontractors
Effective May 1, 2021, the Virginia Prevailing Wage Law — also called the “Little Davis-Bacon Act” – applies to contractors and subcontractors working under a new public contract over $250,000 with any state agency or with localities that have adopted the prevailing wage ordinance. Applicable contractors and subcontractors are required to pay prevailing wages and benefits to all employees who perform services on that contract.
The prevailing wage rates for each labor classification in the geographic area where the work is to be performed are determined by the Virginia Commissioner of Labor and Industry (“DOLI”). The prevailing wage rate may also require paid benefits and holidays, depending on the labor classification.
When a public contract subject to the new law is awarded, the contractor must certify to the DOLI Commissioner under oath the pay scale to be used for each craft or trade employed under the public contract. The sworn certification must include:
the total hourly amount to be paid to workers, including wages and applicable benefits, for each craft or trade;
an itemization of the amount paid to workers;
a list of the names and addresses of any third party fund, plan, or program to which benefit payments will be made on behalf of workers;
confirmation that its wage payment records are being preserved for a minimum of six years, will be made available to DOLI upon request, and reflect the actual hours worked and the amount paid to its workers for the time period in a DOLI audit request; and
confirmation that it complied with the requirement to post the general prevailing wage rate for each craft and classification on the project in prominent and easily accessible places at the job site or at places where the contractor pays the workers their wages. Certification of compliance with this posting requirement must be given within 10 days of such posting.
Washington OSHA Issues Emergency Heat Standard
Effective July 13, 2021, an emergency rule increases protections for employees working in agriculture, construction, and other outdoor industries who are exposed to extreme heat at work.
The emergency rule requires that employees be allowed and encouraged to take preventive cool-down rest breaks of at least ten minutes every two hours to protect themselves from overheating. These breaks must be paid unless taken during a meal period. Employees are also required to provide impacted employees with a sufficient quantity of drinking water that is “suitably cool.”
When temperatures are at or exceed 100 degrees Fahrenheit, employers are required to have and maintain one or more areas with shade at all times while employees are present that are either open to the air or provided with ventilation or cooling. The shaded areas must be located as close as practicable to where the employees are working and must not be adjoining a radiant heat source such as machinery or a concrete structure. They must be large enough to accommodate the number of employees on a meal or rest break. In lieu of shade, employers must use “other sufficient means” to reduce body temperature to accommodate all employees on a meal or rest break.
Safety Obligations Expanded for Temporary Construction, Manufacturing Workers
Effective July 25, 2021, SHB 1206 mandates new safety obligations for certain employers and staffing agencies that use temporary construction and manufacturing workers.
The new law applies to construction general contractors and subcontractors engaged in the construction of buildings or highway and utility projects (sector 23 of the North American Industry Classification System, or “NAIS”) and to manufacturing plants, factories, or mills that use power-driven machines and materials-handling equipment (sectors 31 through 33 of NAIS).
SHB 1206 also applies to staffing agencies that recruit and hire employees and temporarily assign those employees to applicable construction and manufacturing employers. Before assigning a covered temporary employee to the worksite employer, the staffing agency must inquire about the worksite employer’s safety and health practices and hazards at the actual workplace where the employee will be working to assess the safety conditions, workers’ tasks, and the worksite employer’s safety program. Safety assessment must continue throughout the employee’s assignment.
Washington Industrial Safety and Health Act Amended
Effective July 25, 2021, ESHB 1097 amends the Washington Industrial Safety and Health Act (“WISHA”) to prohibit actions that would deter reasonable employees from reporting dangerous workplace conditions. The new law also expands the time for filing a workplace safety complaint with the Department of Labor and Industries from 30 days to 90 days, as well as establishes procedures for an employer to contest an order of immediate restraint by the department.
REMINDER: Paid Family and Medical Leave Assistance Grants to be Available Starting August 1
Starting August 1, 2021, employees and certain employers in Washington can apply for pandemic leave assistance grants under the state’s amended Paid Family and Medical Leave (“PFML”) Act.
Under the PFML Act, an employee is eligible for PFML if they have a serious health condition and worked 820 hours in the qualifying period of the first four of the last five completed calendar quarters or the last four completed calendar quarters immediately preceding the application for leave. The temporary amendment in place through June 30, 2023, creates a new pandemic leave assistance grant for those employees whose hours were reduced due to the pandemic and thus did not qualify for PMFL.
If an employee seeks PFML with an effective start date for any point in 2021 through March 31, 2022, but does not meet the law’s “hours worked” requirement, the employee is eligible for a pandemic leave assistance grant if they either:
Worked 820 hours in 2019; or
Worked 820 hours during the second through fourth calendar quarters of 2019 and the first calendar quarter of 2020.
An employee is ineligible if they have insufficient hours worked because of employment separation due to misconduct or a voluntary separation unrelated to COVID-19. Employees cannot receive a grant for any week for which they have received unemployment compensation, workers’ compensation, or any other applicable federal unemployment compensation, industrial insurance, or disability insurance.
Employers with 150 or fewer employees may be eligible to apply for a grant of up to $3,000 if they hire a temporary worker to replace an employee on PFML for seven days or more. Employers with 50 or fewer employees who choose to pay the employer-side PFML premiums may be eligible to apply for a grant of up to $1,000 as reimbursement if their employees’ PFML creates significant additional wage-related costs.