LEGAL UPDATE MARCH 2020
In this time of uncertainty and concern, we here at HR Service want to wish everyone health and safety for themselves and those they work with, care about, have come to know, and will get to know in the future. We are all in this together.
EMPLOYER RESOURCES AVAILABLE FOR CORONAVIRUS RESPONSE
HR Service has created an employer toolkit that contains resources, recommendations, and information about COVID-19 / Coronavirus response. Go to: COVID-19 EMPLOYER TOOLKIT, and go here for a list of responses to FREQUENTLY-ASKED QUESTIONS. Keep checking back for the most up-to-date information.
FUTURE COMPLIANCE DATES
MARCH 31, 2020: Electronic Forms 1094-B & 1095-B or 1094-C & 1095-C Due to IRS
If filing electronically, ACA forms 1094-B and 1095-B or forms 1094-C and 1095-C are due to the IRS by March 31. Any Applicable Large Employer (“ALE”) filing 250 forms or more must file electronically.
APRIL 22, 2020: Administrative Professionals’ Day
April 22, 2020 is designated as Administrative Professionals’ Day. Administrative Professionals’ Day is an opportunity for employers to recognize and celebrate the contributions of these key front-line employer representatives.
APRIL 30, 2020 for new health plans on a calendar plan year: Summary Plan Description
Employers who offer a health insurance plan must provide a Summary Plan Description (“SPD”) to all participants within 120 days after a new plan is adopted. SPDs must also be provided to new participants no later than 90 days after the person first becomes covered under the plan. For assistance or information about our SPD Wrap service, contact HR Service at: (855) 447-3375
Prior to state primary election days: Voting Leave May Be Required
While there are no federal laws requiring time off to vote, many states require employers to provide voting leave. State primary election days vary, and some state primary election dates have been postponed from the original date scheduled. Confirm your state’s primary election date to prepare for voting leave and notifications, if needed.
FEDERAL COMPLIANCE UPDATES
“FAMILIES FIRST CORONAVIRUS RESPONSE ACT” PASSED
On March 18, 2020, the federal government passed the Families First Coronavirus Response Act. The Act requires mandatory paid sick leave and expands Family Medical Leave provisions.
Effective April 1, 2020, employers with fewer than 500 employees (including full-time and part-time) will be required to offer 10 days of paid sick leave for COVID-19-related reasons. Full-time employees must be provided 10 days (80 hours), and part-time employees must be provided the number of hours of paid sick time equal to the number of hours they work, on average, over a 2-week period.
Eligible reasons for leave include the following:
- Employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
- Employee has been advised by a health care provider to self-quarantine related to COVID-19;
- Employee is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
- Employee is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
- Employee is caring for a child whose school or place of care is closed (or child care provider is unavailable) for reasons related to COVID-19; or
- Employee is experiencing any other substantially-similar condition specified by the Secretary of Health and Human Services, in consultation with the Secretaries of Labor and Treasury.
If the sick leave is for an employee who is sick, quarantined, or seeking a diagnosis (reasons 1 – 3 above), the benefit must replace all of the employee’s wages up to a maximum benefit of $511 per day. If an employee is requesting leave for reasons 4-6 above, the benefit must replace at least two-thirds of the employee’s wages up to a maximum benefit of $200 per day.
Payroll tax credits will be provided to employers with up to 500 employees to cover 100% of the cost of the paid sick leave for COVID-19-related absences. Tax credits will also be offered to offset the employer contribution for health insurance premiums for the employee for the period of leave. Self-employed individuals will also be eligible for tax credits.
Employers with fewer than 50 employees will be able to apply for a hardship exemption from providing paid leave due to school closings or child care unavailability if they can show that it would jeopardize their business. The process to request such an exemption was not clarified in the language of the Act, however, we will provide any updates on this matter as they are made available.
In addition, the Act provides for up to 12 weeks of Emergency Family and Medical Leave (“EFML”) if the employee is unable to work (or telework) because they need to care for a child whose school or daycare has been closed or whose regular childcare provider is unable due to a COVID-19 public health emergency. The 12 weeks of EFML could include two weeks of paid sick leave (as detailed above) at 2/3 of regular rate followed by up to 10 weeks of paid expanded family & medical leave paid at 2/3 of regular rate. Employees can instead choose to substitute any accrued vacation leave, personal leave, or medical or sick leave for the first two weeks. The presumed advantage of taking previously accrued leave, if available, is that it would be at 100% of pay rather than 2/3.
Eligibility for the leave is only 30 days of employment, as opposed to the 1,250 hours in the previous 12 months under FMLA. As with under FMLA, employees must be restored to their previous or an equivalent position. Employees with 25 or fewer employees can be exempt from the requirement to restore the employee to the previous position if the position no longer exists and an equivalent position could not be found after reasonable effort.
Individual states have also announced various new legislation, resources, and assistance for impacted business and workers. Check your state’s Department of Labor, Department of Revenue, unemployment division, insurance division and other commerce-related websites for information specific to your state.
For answers to frequently-asked questions about the Act and other Coronavirus-related issues, go to: COVID-19 EMPLOYER TOOLKIT. Keep checking back for the most up-to-date information.
2019 HSA CONTRIBUTIONS DEADLINE EXTENDED TO JULY 15, 2020
The IRS has just confirmed 2019 HSA Contributions may be accepted up to the filing deadline of July 15, 2020. This extension came in conjunction with the announcement in Notice 2020-18 (PDF) from the Treasury Department and the Internal Revenue Service (IRS) regarding special Federal income tax return filing and payment relief in response to the ongoing Coronavirus Disease 2019 (COVID-19) emergency.
Contributions may be made to an HSA or Archer MSA for a particular year up to the due date for filing a return for that year. Because the due date for filing Federal income tax returns is now July 15, 2020, contributions to an HSA or Archer MSA for 2019 may be made at any time up to July 15, 2020. For more details on HSA or Archer MSA contributions, see Publication 969, Health Savings Accounts and other Tax-Favored Health Plans.
REMOTE FORM I-9 DOCUMENT REVIEW TEMPORARILY APPROVED
Effective March 20, 2020, U.S. Immigration and Customs Enforcement (“ICE”) has eased requirements to review an employee’s identity and employment authorization documents in the employee’s physical presence for Form I-9 – but only when that employee will be working remotely.
Employers may first inspect Section 2 documents remotely (e.g., via video, fax or email). Once normal operations resume, employers must inspect documents in person and note “COVID-19” as the reason for the delay in the section’s “additional information” field, as well as “documents physically examined” with the date of inspection to that field or Section 3 as appropriate.
Employers who make use of the exception must provide written documentation of their remote onboarding and telework policy for each employee. It is also advised this is exception is used only as a last resort and that employers closely document the circumstances for which the exception is necessary.
These provisions may be implemented by employers for a period of 60 days from March 20, 2020 OR within 3 business days after the termination of the National Emergency, whichever comes first.
NLRA JOINT EMPLOYMENT RULED ISSUED
Effective April 27, 2020, a final rule issued by the National Labor Relations Board (“NLRB”) establishes the standard for determining whether two or more employers have joint employer status under the National Labor Relations Act (“NLRA”).
Employers will be considered a joint employer only if they possess and exercise substantial direct and immediate control of another employer’s employees over one or more essential terms and conditions of employment, as exclusively defined by the final regulation.
STATE COMPLIANCE UPDATES
In the recent case Frlekin v. Apple Inc., the California Supreme Court has held that the time spent by employees waiting for and undergoing security checks of bags and other personal items is compensable time under California law, even when the policy applies only to employees who choose to bring personal items to work.
The court provided a multifactor test as to whether “onsite employer-controlled activities” must be compensated as hours worked.
New Jersey Expands Wage Statement Requirements
Effective May 20, 2020, New Jersey’s amended Wage Payment Law requires employers with at least 10 employees to furnish employees with additional information each pay period to assist in determining whether their wages are being properly calculated. The following must be included on pay statements each pay period:
- gross wages
- net wages
- rate of pay
- the number of hours worked by the employee during the pay period, if relevant to the wage calculation
Retaliation Protections for Misclassified Workers; Posting Requirement
Effective April 1, 2020, businesses in New Jersey must conspicuously post notification regarding worker misclassification that explains:
- The prohibition against employers misclassifying employees;
- The ABC test used by the New Jersey Department of Labor & Workforce Development (“LWD”) to determine whether an individual is an employee or an independent contractor;
- The benefits and protections to which an employee is entitled under New Jersey’s wage, benefit and tax laws;
- The remedies under New Jersey law to which workers affected by misclassification may be entitled; and
- Information on how a worker may contact the LWD to provide information or file a complaint regarding possible worker misclassification.
Employers are prohibited from discharging or discriminating against an employee because they:
- Made an inquiry or complaint to their employer or to the LWD regarding possible worker misclassification;
- Caused to be instituted or are about to cause to be instituted any proceeding regarding worker misclassification under state wage, benefit and tax laws; or
- Have testified in a proceeding.
The existing statute has been amended to provide that any individual acting on behalf of an employer may be held liable as the employer for any such violations. It states that any such individual may be “an owner, director, officer, or manager” for the employer.
Bone Marrow and Organ Donation Leave Required
Effective May 20, 2020, New Jersey’s Temporary Disability Benefits Law will be expanded to provide job-protected leave to individuals who are unable to work because they are donating an organ or bone marrow. In addition, the law eliminates the one-week waiting period for the payment of temporary disability benefits for purposes of donating an organ or bone marrow.
In related legislation, an employer is eligible for a tax credit if it chooses to provide a paid leave of absence to employees for the specific purpose of bone marrow or organ donation and if such time is in addition to any other paid time off granted to the employee. The credit is equal to 25% of the employee’s salary during the time missed from work, for up to 30 days of missed work for each donation. This law is also effective May 20, 2020.
New York City Adopts Law Prohibiting Pre-Employment Testing for Marijuana
Effective May 13, 2020, many employers in New York City are prohibited from conducting pre-employment drug testing for marijuana and THC.
The law includes numerous exceptions to the prohibition, including the following:
- Police / law-enforcement officers
- Positions requiring construction safety training or OSHA certifications under New York laws
- Positions requiring commercial driver’s licenses
- Positions involving the supervision or care of children, medical patients, or vulnerable persons as defined under New York laws
- Other positions with potential to significantly impact health or safety as determined under the regulations to be enacted or identified on the website of the department of citywide administrative services
- Department of Transportation required testing
- Testing required under federal contracts or grants
- Testing required under federal or state statutes
- Testing required under collective bargaining agreements
Philadelphia’s Fair Workweek Ordinance Effective April 1
Effective April 1, 2020, Philadelphia’s Fair Workweek Ordinance requires establishments in the retail, hospitality, and food service industries with 250 or more employees and 30 or more locations worldwide to provide good faith estimates of average work schedules to existing employees. This applies to all non-exempt full-time, part-time, temporary, and seasonal workers in Philadelphia of such employers, and whose job duties involve retail trade, food, or hospitality services.
An employee who works hours not included in the new employment notice or subsequent posted work schedule is entitled to predictability pay in addition to his or her regular pay for hours actually worked. When the employer’s change in hours does not result in lost hours, the predictability pay will be one hour of pay at the employee’s regular rate of pay. When the employer’s change results in hours being subtracted or a shift or shifts being cancelled, the predictability pay will be no less than one-half times the employee’s regular rate of pay per hour for any hours he or she does not work.
While the ordinance goes into effect April 1, 2020 it will not be enforced until July 1, 2020. Employers are required to post a notice about the new law, which can be downloaded here: Fair Workweek Ordinance poster.
For additional details, go to the Mayor’s Office of Labor website.
Medical Cannabis Act Amended
Effective February 27, 2020, Senate Bill 121 amends the Medical Cannabis Act. Provisions of the amended law that impact private employers include the following:
- The amended law clarifies that private employers are not required to accommodate the use ofmedical cannabis and are not restricted from having policies prohibiting the use of medical cannabis by applicants or employees.
- Because CBD use can cause a person to fail a drug test due to trace amounts of THC, those who fail a drug test but who only used a CBD can challenge the test and be held harmless (in court, by a government employer, etc.) unless there is evidence that the individual illegally possessed or used THC.
- Patients convicted of marijuana use before Proposition 2 can seek expungement of their crime under certain circumstances.
SB 121 also clarifies some of public employer accommodation requirements, including exceptions when cannabis use would jeopardize federal funding, a federal security clearance, or any other federal background determination required for the employee’s position or when the employee’s position is dependent on a license that is subject to federal regulations.