2015 employment law update what every employer needs to know
TRANSCRIPT
2015
EMPLOYMENT LAW UPDATEWhat Every Employer Needs To Know
Today’s Agenda1. Litigation Trends
2. Company Policies
• Employee Handbooks• Dress Code• Discipline• Social Media
3. Wage & Salary (DOL)
• Independent Contractors• Exempt and Non-Exempt• Meal & Rest Periods
4. Discrimination (DOJ)• ADA/FMLA/Workers’ Compensation• Fitness for Duty• Substance Abuse
5. Affordable Care Act• Myth v. Fact• Penalties for Non-Compliance
© 2015 The Weston Group All Rights Reserved.
Today’s Speakers
Scott Leuning JDAttorney
Goosman Law Firm
Offices in Sioux City IA and Sioux Falls SD
Practice focuses on medical malpractice
defense, health law, employment law, and
complex civil litigation. Also experienced
in medical regulatory matters,
commercial litigation, and representing
municipalities and school districts.
© 2015 The Weston Group All Rights Reserved.
Patricia Dougherty RN SPHRManaging Partner
The Weston Group
Practice focuses on HR support services for
small to medium sized businesses. The Weston
Group provides on-site, online and unlimited
phone/email access to businesses across the
US. The Weston Group assesses a company's
practices and develops strategies and solutions
tailored to enhance organizational success.
Federal Employment Law
HIPAANational OriginOSHARace DiscriminationReligious DiscriminationSex DiscriminationSexual HarassmentWARN
ADA- Disability DiscriminationAffirmative ActionAge DiscriminationClass ActionsCOBRAEmployee BenefitsFLSA & Wage & HourFMLAImmigration
© 2015 The Weston Group All Rights Reserved.
61% of businesses expect to see a jump in the
number of litigation matters they will be
handling in 2015
Corporate counsels are embracing early case
assessment as a litigation management tool
Litigation Trends
© 2015 The Weston Group All Rights Reserved.
Texas consistently has the highest number of EEOC claims
Nationally: Settlement dollars have increased by 68% in the last 10 years
Litigation Trends EEOC Statistics
NATIONAL Totals # of Claims Filed
2009 -93,2052010 – 100,2312011 – 111, 2592012 – 99,5072013 – 93,7272014 – 88,778
Retaliation Cases (42% of total)
© 2015 The Weston Group All Rights Reserved.
Employment Discrimination Trends
• 60% increase in ADA cases from 2010-2012• Discharge• Reasonable accommodation• Harassment• Discipline
• Title VII and ADEA remain stable• Discharges• Sexual harassment• Discipline• Intimidation• Hiring Department of Justice Issues
© 2015 The Weston Group All Rights Reserved.
© 2015 The Weston Group All Rights Reserved.
0
10
20
30
40
50
60
70
80
200920102011201220132014
95% Increase since 2009
Historical South Dakota Charges
Top Five Litigation Risks
#1 Misclassification of Independent Contractors**
#2 Wage & Hour Violations**
#3 Gender & Race Discrimination*
#4 Americans with Disabilities Act*
#5 Family & Medical Leave**
* Discrimination cases – DOJ** Department of Labor issues
© 2015 The Weston Group All Rights Reserved.
Goosmann Law Firm’s Guide to Employee Handbooks:
What Every Employer Needs to KnowSCOTT LEUNING
101 South Reid Street, Suite 307Sioux Falls, SD 57103
(605) [email protected]
AGENDA
Overview of Employee Handbooks.
Key Elements to Include in Your Handbook
Questions
DO I REALLY NEED A HANDBOOK?
Unless You Have No Employees, the Answer Is YES.◦Your handbook provides a blue print for your vision.◦Your handbook sets forth your expectations for employees.
Your Handbook Helps Reduce the Possibility of Litigation ◦Addressing workplace discrimination◦Addressing leave issues◦Addressing
Having a Handbook Makes Your Life Easier
CONTENTS OF AN EMPLOYEE HANDBOOK
Company Overview and Vision
At-Will Employment Statement
Workplace CommitmentsCompany Policies &
ProceduresEmployment Classification
Attendance PoliciesLeave PoliciesWork PerformanceDiscipline PolicyEmployee Health & SafetyBenefitsAcknowledgement of
Receipt
COMPANY OVERVIEW & VISION
This section should provide your employees with general history and background about your company.
If you have a vision or mission statement place it in this section.
PURPOSE OF THE HANDBOOK Handbook has been prepared to inform new employees of the
policies and procedures of this company.
The handbook is not all-inclusive nor intended to provide strict interpretations of policies.
The handbook offers an overview of work environment.
The handbook is not a contract, either expressed or implied, guaranteeing employment.
Company reserves the right to unilaterally revise, revoke, terminate or change any policies.
This handbook replaces any and all previous handbooks.
AT-WILL EMPLOYMENT
Employment at this company is at-will.
Employment relationship can be terminated at any time, with
or without reason or notice by either the employer or the
employee.
At-will employment relationship exists regardless of any
statements by the office personnel to the contrary.
At-will nature of this employment relationship can only be
modified in writing.
EQUAL OPPORTUNITY EMPLOYMENT
Establish that company is an equal opportunity employer.
No unlawful discrimination against employees or applicants on
basis of race, color, religion, creed, sex, national origin, age,
disability, marital status, veteran status, or any other status
protected by applicable law.
Note that reasonable accommodations will be made for qualified
individuals with disabilities to the extent required by law.
NON-HARASSMENT/NON-DISCRIMINATION POLICY
Include a section that outlines your company’s non-harassment policies.
Include instructions as to how to report harassment and who to report it to.
Follow the policy once it is implemented, including promptly investigating claims made by employee.
COMPANY POLICIES AND PROCEDURES
Professional Conduct.
Dress Code.
Pay Periods.
Company Property.
Social Media.
Privacy.
Personnel Files.
PROFESSIONAL CONDUCT
Include a general statement about employees being
respectful and courteous.
Statement that general cooperation between
coworkers and supervisors is expected.
Individuals who act in an unprofessional manner may
be subject to disciplinary action.
DRESS CODE
If your employees deal extensively with the public you may want a dress code.
Factors to consider:1) Your business’s public image2) Nature of the work performed by employees3) Safety standards4) Employee privacy interests5) Whether the dress code will create morale problems
DRESS CODES AND THE LAW
Your dress code cannot treat some employees less favorably because of their national origin.
If dress code conflicts with an employees’ religious practices and the employee requests an accommodation, employer must modify the dress code or permit an exception unless is causes undue hardship.
Dress codes must be modified to accommodate a disability.
DRESS CODES AND THE LAW
Employers can require employees to remove piercings or
cover body art. (Such policies must be uniform for gender)
Under the law an employee has no legal right to show body
art in the workplace that isn’t considered a religious or
racial expression.
Dress code policies must target all employees
PAY PERIODS
This is the section every employee with read!
Include information as to who to contact if there is a
mistake in pay calculation.
Address whether advances will be permitted.
Address issue of lost or misplaced checks.
COMPANY PROPERTY
Specify how company equipment will be treated.
In your policy “business use only?”
Company vehicles—off-duty use, other drivers, etc.
Computers/Phones: internet use, downloading software, etc.
Remind employees that they should have no expectation of
privacy in their use of company computers or other
electronic equipment.
SOCIAL MEDIA
You cannot ignore social media.
If you don’t have a social media policy, you need one in your handbook.
SOCIAL MEDIA DEMOGRAPHICS
72% of all internet users are active on social media
71% of users access social media with mobile device
18-29 year olds have 89% usage
30-49 year olds have 72% usage
50-59 year olds have 60% usage
23% of Facebook users login at least 5 times per day
SOCIAL MEDIA POLICIES
The reality is that your employees probably access social media during work hours.
If not, they are probably talking about your business at times on social media.
How do you address this issue?
SOCIAL MEDIA/NLRB RULINGS
You cannot broadly ban employees from exercising their right to communicate with each other with the aim of improving wages, benefits, working conditions.
You can prohibit vulgar, obscene, threatening or harassing activity.
You can also prohibit employees from disclosing confidential and/or proprietary information.
CONTENTS OF A SOCIAL MEDIA POLICY
R * E * S * P * E * C * T
ResponsibilityEtiquetteSelectivityPrivacyEfficiencyConfidentialityTransparency
RESPONSIBILITY
Employees must be responsible about:
1) The content they post
2) The audience their posts reach
3) The potential effects of an improper post
ETIQUETTE
Not all social media posts are absolutely protected by law.
An employee who uses social media to harass, intimidate or bully other employees violates the employer’s legal requirement to maintain a workplace free of harassment and discrimination.
Your social media policy must convey that such behavior will not be tolerated.
SELECTIVITY
Employee posts about company products should be posted with caution.
Decisions about when to respond, and what to say, about criticisms made against your company, need to be made at the corporate level and that should be spelled out in your social media policy.
PRIVACY
Your social media policy should prohibit employees from disclosing private matters such as: Medical issuesLeaves of absenceIdentifying information about employees,
including Social Security Numbers, and dates of birth.
EFFICIENCY
Employees may occasionally use social media at
work, but it must not affect workplace expectations
regarding employee performance.
CONFIDENTIALITY
Company confidentiality applies to social media.
Confidential nonpublic information, business plans,
pricing models, attorney-client privileged documents,
etc. should not be disclosed on social media.
TRANSPARENCY
Employer posts on social media must be transparent and honest.
Positive comments about business products/services must be accurate.
You cannot pay people for positive posts (Samsung)
PRIVACYBe explicit as to the level of privacy expected in
workplace.
Specify that company retains access to all company property, including computers, desks, file cabinets, storage facilities.
Employees should know they should not expect privacy when on company grounds or when using company property.
PERSONNEL FILESNo statutory provision in South Dakota.
You may want to establish a policy allowing employees access to their personnel file upon request.
You should have a policy that employees must promptly notify company of any changes of address, marital status, number of dependents, emergency contact, etc.
EMPLOYMENT CLASSIFICATION
Exempt employees.
Non-exempt employees
Part-time vs. Full-time employees.
ATTENDANCE POLICIES
General statement regarding hours of operation.
Tardiness and Breaks
Leave policies:◦ Vacation.◦ Sick Leave◦ Family Medical Leave Act/Leave of Absence
Holidays
Jury Time
Military Leave
Work Performance
Expectations
Reviews
Insubordination
DISCIPLINE POLICY
General Statement:
The company reserves the right to discipline and/or terminate any employee who violates company policies or rules of conduct. Poor performance and misconduct are also grounds for discipline or termination.
DISCIPLINE POLICY (cont.)
List of actions considered unacceptable and considered grounds for discipline….
If you include a list, ALWAYS include saving language:
“This list is not comprehensive; rather, it is meant merely as an example of the types of conduct that this company does not tolerate. These actions include, but are not limited to:
DISCIPLINE POLICY (cont.)
Progressive Discipline Language:
Be careful about setting up progressive stages of discipline, this could be interpreted as being binding because you are guaranteeing certain steps to be taken for discipline.
Progressive discipline may defeat your at-will employment status.
TERMINATION
Reiterate that employment is on an at-will basis.
Set out what happens upon termination:◦Continue to work until last scheduled day of
employment;◦Turn in all reports and paperwork required by employer;◦Return all files, company property and equipment;◦Turn in all passwords to supervisors;◦Participate in an exit interview.
EMPLOYEE HEALTH AND SAFETY
◦2013: 4,405 workplace fatalities (12 per day on average)
◦2013: 2.9 million accident-related injuries at work
EMPLOYEE HEALTH AND SAFETY
Accident Prevention
Training on any Equipment
Maintaining a Safe Work Area
Protective Equipment
Procedure for Reporting Unsafe Conditions
EMPLOYEE SECURITY
1) Workplace homicide is leading cause of death
among female workers in U.S.
2) 2011: 780 workplace fatalities due to violence
(homicides and suicides)
3) Shootings account for 78% of workplace homicides
4) Disgruntled employees/Domestic Violence
EMPLOYEE SECURITY POLICIES
1) Security badge system
2) No unescorted guests
3) When employees are terminated or laid off be
sure to get their badge
4) Surveillance cameras
5) Adequate lighting if you have night shift
EMPLOYEE BENEFITS
Health Insurance
Retirement Plan
Workers’ Compensation
Disability Coverage
EMPLOYEE BENEFITS
Sample Disclaimer Language:
This handbook contains descriptions of some of our current employee benefits. Many of the company’s benefit plans are described in more formal plan documents available from [insert name/title]. In the event of any inconsistencies between this handbook or any other oral or written description of benefits and a formal plan document, the formal plan document will govern.
TERMINATION
Situations may arise where an employee decides to quit.
Request that employee provide two weeks notice.
This notice does not alter at-will employment.
Terminating employees are required to turn in all company
property.
Failure to turn in company property may result in
withholding final paycheck.
TERMINATION
Include information regarding final paycheck.
COBRA benefits
Exit interview
◦Complete necessary forms
◦Collect company property
◦Discuss employment experiences with company
ACKNOWLEDGEMENT OF RECEIPT
Be sure to have employee sign and date, as well
as the employee’s supervisor or other
authorized person.
Questions?
Short Break
Top Five Risks
#1 Misclassification of Workers as INDEPENDENT CONTRACTORS
• Civil penalties against an employer of up to $1,000 per misclassified employee for a first violation and up to $2,500 per misclassified employee for each subsequent violation
• Misclassification of employees as independent contractors can result in substantial liability and penalties for, among other things, back taxes, overtime pay, workers compensation, employee health benefits, and retirement benefits
© 2015 The Weston Group All Rights Reserved.
#2 WAGE & HOUR VIOLATIONS
•The Fair Labor Standards Act (FLSA) sets minimum wage and overtime pay standards for employment.
•The Act also gives the U.S. Department of Labor's (DOL) Wage Hour Division (WHD) the authority to investigate and gather data regarding the wages and hours of employment for entities subject to the requirements of the Act.
• Employers that violate minimum wage or overtime pay provisions may have to pay back wages and penalties.
•Recent settlements:• AT&T = $1 Billion • Walmart = $40 Million (in Massachusetts alone!)
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#2 WAGE & HOUR VIOLATIONS
• Just over 40% had deductions illegally taken from their paycheck (for breakage or to pay for tools or other items required for work, for example)
• Exempt vs. Non-Exempt – HUGE
• The DOL has added 250 new investigators and damages/ attorney’s fees will be doubled for “willingly and knowing” violations
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
Nonexempt and Exempt
Nonexempt employees -Hourly
Exempt employees -$455/week -Cannot be subject to reduction because of
variations in the quality or quantity of work
-Docking issues
WHO DETERMINES CLASSIFICATION?
© 2015 The Weston Group All Rights Reserved.
What Hours Count?Employees must be paid for
work “suffered or permitted” by the employer even if the employer does not specifically authorize the work.
If the employer “knows or has reason to believe” that work is occurring, the employee must be paid for the hours—even if off-site or off-shift.
MANAGE THE ISSUE
© 2015 The Weston Group All Rights Reserved.
Rest Periods
◦ Meals Required under FLSA? 30 minutes UNINTERRUPTED Automatic deductions
◦ Work breaks 5-20 minutes Not a guarantee
◦ Sleep time
© 2015 The Weston Group All Rights Reserved.
#3 GENDER & RACE DISCRIMINATION
Sexual Harassment in the Workplace: It's Not Always What You Think
Male – Female
Female – MaleFrom 1990 to 2009, the percentage of sexual
harassment claims filed by men has doubled from 8 percent to 16 percent of all claims, according to the Equal Employment Opportunity Commission.
Same sex harassmentMost often settlements EEOC states these are also on the rise
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#3 GENDER & RACE DISCRIMINATION
Sexual Harassment in the Workplace: It's Not Always What You Think
The perpetrator does not have to be part of the same company as the victim.
Any party acting as an agent of the employer such as a real estate agent or consultant can be a perpetrator in a harassment claim.
In addition, a harasser could be a delivery person from another company. The company who sent the delivery person could be
held accountable for the harassment.
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#3 GENDER & RACE DISCRIMINATION
Sexual Harassment in the Workplace: It's Not Always What You Think
The victim does not have to suffer economic or job related injury to file a harassment claim.
Hostile work environment harassment is harassment that typically must be intentional, severe, recurring and pervasive, and interfere with an employee's ability to perform his or her job
Work Place Romance…..
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#3 GENDER & RACE DISCRIMINATION
WORKPLACE ROMANCE
In a survey by CareerBuilder.com in 2009, 40% of respondents revealed that they have dated a coworker
When can consensual sex create a hostile workplace environment?
Sexual favoritism California Supreme Court held that "when
such sexual favoritism in a workplace is sufficiently widespread it may create an actionable hostile work environment”
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#4 Americans with Disabilities Act
• The ADAAA, which took effect in January 2009, makes it significantly easier for a plaintiff to establish that he or she is disabled under the ADA
• While the ADAAA retains the ADA’s definition of “disability” as a substantial limitation of a major life activity, it stipulates that its meaning “shall be construed in favor of broad coverage of individuals
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#4 Almost everyone is covered by ADAAA
• More people with disabilities filed charges of discrimination against their employers last year than at any other time in the 20-year history of the Americans with Disabilities Act
• USA Today: The number of ADA charges filed in 2009 hit an all time high with almost 21,500 ADA related charges being filed with the EEOC
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
Defining Disability◦Physical or mental
impairment that substantially limits a major life activity
◦Record of impairment
◦Regarded as having an impairment
© 2015 The Weston Group All Rights Reserved.
Defining Disability (cont.)
Covered:◦AIDS or HIV virus◦Epilepsy◦Learning disability◦Limited or no use of limbs◦Mental retardation◦Paralysis◦Hearing, vision, or speech impairment
© 2015 The Weston Group All Rights Reserved.
Defining Disability (cont.)
Not covered:
◦Impairments of short duration
◦Temporary impairments
◦Illegal drug use
© 2015 The Weston Group All Rights Reserved.
ADA and Addictions
◦Alcoholism covered (not while on duty!)
◦Current use of illegal drugs not covered
◦Other addictions not covered Gambling Sex Addict Etc.
© 2015 The Weston Group All Rights Reserved.
Basic Statutory Obligations
◦We may not discriminate based on disabilities
◦We must make reasonable accommodations
◦We may hire the best qualified applicant
© 2015 The Weston Group All Rights Reserved.
Reasonable Accommodation
◦Changes that allow a qualified individual
to do the job
◦Reassignment to light duty
© 2015 The Weston Group All Rights Reserved.
Medical Information
◦All medical information must be kept strictly confidential
© 2015 The Weston Group All Rights Reserved.
Job Interviews
Don’t ask about the:◦Existence of a
disability
◦Nature of a disability
◦Severity of a disability
© 2015 The Weston Group All Rights Reserved.
Job Interviews (cont.)
Only ask about reasonable accommodation when:
◦Describing the hiring process
◦Disability is obvious or disclosed
◦Describing or demonstrating how the job is performed
© 2015 The Weston Group All Rights Reserved.
After the Job Offer
◦Post-offer inquiries about accommodation are allowed
◦Pre-employment physicals may be allowed
◦Medical exams may be requested
© 2015 The Weston Group All Rights Reserved.
Medical Certification & Exams◦Reasonable medical
records may be requested—not all medical records
◦Medical exams may be requested when documentation is insufficient
© 2015 The Weston Group All Rights Reserved.
Direct Threat
◦Employee with disability poses a significant risk of substantial harm in the workplace
◦We are not required to accommodate
◦We must determine direct threat
© 2015 The Weston Group All Rights Reserved.
#5 FAMILY & MEDICAL LEAVE
• According to WorldAtWork.org, claims related to FMLA have increased by more than 10 percent this year
• More people in the United States are becoming aware of their rights under FMLA or perhaps less companies want to provide family medical leave protection to workers in such tough economic times.
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#5 FAMILY & MEDICAL LEAVE
The top reasons for FMLA leave:
• Personal illness or injury
• Care for a child
• Care for an elderly relative.
• Time off for pregnancy
• Time off for the adoption of a child or birth of a child
• Care for a recently injured military member
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
#5 FAMILY & MEDICAL LEAVE
Most important to remember:
• Determine if employee is eligible• Make employee aware of eligibility• Start the paperwork process• Be sure you get completed paperwork• Access resources if you don’t understand the condition• Track utilization if intermittent• Get re-certification if needed• Track exhaustion of leave• BE CONSISTENT!
Top Five Risks
© 2015 The Weston Group All Rights Reserved.
85
For the Birth or Placement of a Child
Both the mother and father are entitled to FMLA leave for the birth or placement of the child and/or to be with the healthy child after the birth or placement (bonding time)
Employees may take FMLA leave before the actual birth, placement or adoption
Leave must be completed by the end of the 12-month period beginning on the date of the birth or placement
© 2015 The Weston Group All Rights Reserved.
86
Serious Health Condition
Illness, injury, impairment or physical or mental condition involving:
• Inpatient Care, or
• Continuing Treatment by a Health Care Provider
• Does not need to be an MD
• An overnight stay in a hospital, hospice, or residential medical facility
• Includes any related incapacity or subsequent treatment
© 2015 The Weston Group All Rights Reserved.
87
Amount of Leave
•Employee’s workweek is basis for entitlement
•Eligible employees may take up to 12 workweeks* of FMLA leave:
– for the birth or placement of a child for adoption or foster care;
– to care for a spouse, son, daughter, or parent with a serious health condition; and
– for the employee’s own serious health condition.
© 2015 The Weston Group
All Rights Reserved.
88
Intermittent Leave• Employee is entitled to take intermittent or reduced
schedule leave for:– Employee’s or qualifying family member’s serious health
condition when the leave is medically necessary
–Covered service member’s serious injury or illness when the leave is medically necessary
–A qualifying exigency arising out of a military member’s covered active duty status
• Leave to bond with a child after the birth or placement must be taken as a continuous block of leave unless the employer agrees to allow intermittent or reduced schedule leave
© 2015 The Weston Group All Rights Reserved.
89
12-Month Period
Method determined by employer
• Calendar year
• Any fixed 12-month leave year
• A 12-month period measured forward
• A rolling 12-month period measured backward
© 2015 The Weston Group All Rights Reserved.
90
Employer Responsibilities
Provide notice
Maintain group health insurance
Restore the employee to same or equivalent job and benefits
Maintain records
© 2015 The Weston Group All Rights Reserved.
91
Job Restoration
• Same or equivalent job–equivalent pay
–equivalent benefits
–equivalent terms and conditions
• Employee has no greater right to reinstatement than had the employee continued to work
• Bonuses predicated on specified goal may be denied if goal not met
© 2015 The Weston Group All Rights Reserved.
92
Prohibited Employer Actions
Employers cannot:
• interfere with, restrain or deny employees’ FMLA rights
• discriminate or retaliate against an employee for having exercised FMLA rights
• discharge or in any other way discriminate against an employee because of involvement in any proceeding related to FMLA
• use the taking of FMLA leave as a negative factor in employment actions
© 2015 The Weston Group All Rights Reserved.
93
Fitness for Duty• For an employee’s own serious health condition,
employers may require certification that the employee is able to resume work– Employer must have a uniformly-applied policy or practice of
requiring fitness-for-duty certification for all similarly-situated employees
• If state or local law or collective bargaining agreement is in place, it governs the return to work
• Not permitted for intermittent or reduced schedule leave unless reasonable safety concerns exist
• Authentication and clarification
• Employee responsible for any cost
© 2015 The Weston Group All Rights Reserved.
94
Exhaustion of Leave
If the employee is not able to return to work at expiration of available leave you may need to determine if additional leave may be an accommodation under the ADA.
Not all serious medical conditions are disabilities.
Put the employee on written notice that leave is exhausted, and if they need an accommodation, including additional leave, inform the employee what steps will need to be taken. ◦ Initiate the interactive process.
© 2015 The Weston Group All Rights Reserved.
Americans With Disabilities ActFamily & Medical Leave Act
Workers’ Compensation
“THE TORNADO”
© 2015 The Weston Group All Rights Reserved.
ADA / FMLA / WC
ADA – 15+ Employees Department of Justice
FMLA – 50+ employees Department of Labor
WC – 1+ Employee Department of Labor
© 2015 The Weston Group All Rights Reserved.
Easy Steps to Remember
Work related?
How many employees do you have?
How long has employee been here?
Chronic or just serious?◦ Validate the diagnosis
If ADA, FMLA and WC,GET HELP!!!
© 2015 The Weston Group All Rights Reserved.
Common Mistakes Employers Make
Reactive rather than proactive
“Training does not produce revenue”
Improper termination◦ Be sure to have a consistent corrective action policy
Assuming there is no strong basis for immediate termination, giving at least one warning is important to demonstrate fair treatment
Jurors LIKE employees
© 2015 The Weston Group All Rights Reserved.
Common Mistakes Employers Make
Lack of quality documentation
Favoritism
False comfort◦ Employment-at-will
Do the right thing!
© 2015 The Weston Group All Rights Reserved.
Substance Abuse in the Workplace
Substance abuse in the workplace results in:
◦Absenteeism
◦Diminished productivity
◦On-the-job injuries
◦Potential company liability.
© 2015 The Weston Group All Rights Reserved.
Substance Abuse in the Workplace
The annual cost of alcoholism and drug addiction
to U.S. businesses is approximately $120 billion,
which is more than the productivity loss due to
heart disease, diabetes and stroke combined!
© 2015 The Weston Group All Rights Reserved.
Substance Abuse in the Workplace
Twelve percent of full-time employees acknowledged either
having used an illicit drug or having had five or more drinks
at a time five or more times, or both, in the previous
month.(1)
1 .Source: Substance Abuse and Mental Health Services Administration. The NHSDA Report. National Household Survey on Drug Abuse.
© 2015 The Weston Group All Rights Reserved.
Warning Signs of Substance Abuse
Typical warning signs of substance
abuse at work include:
Personal Appearancedisheveled appearanceunsteady gaitslurred speechbloodshot or glazed eyesodor of alcohol on breath.
© 2015 The Weston Group All Rights Reserved.
Warning Signs of Substance Abuse
Typical warning signs of substance
abuse at work include:
Dependability
Monday/Friday absence pattern
increased tardiness or failure to call in
frequent absences from work area
missed deadlines
© 2015 The Weston Group All Rights Reserved.
Warning Signs of Substance Abuse
Typical warning signs of substance abuse at work
include:
Declining Quality of Work• Increased errors
• work frequently needs to be redone
• inability to understand
• follow through on complex assignments,
• inability to carry out instructions
• low productivity.
© 2015 The Weston Group All Rights Reserved.
Warning Signs of Substance Abuse
Typical warning signs of substance abuse at
work include:Declining Attitude
• uncooperative; increased conflicts with co-workers and customers
• appears nervous
• Distracted
• quick to anger
• exhibits signs of paranoia such as blaming others.
© 2015 The Weston Group All Rights Reserved.
Warning Signs of Substance Abuse
Typical warning signs of substance
abuse at work include:Judgment
Illogical reasons for decisions
violates policies and procedures
takes inappropriate risk
inattentive to safety procedures.
© 2015 The Weston Group All Rights Reserved.
Substance Abuse in the Workplace
NO ONE SIGN SHOULD BE TAKEN AS AN
INDICATION OF SUBSTANCE ABUSE.
Some or all signs could be indicative of a problem
and could constitute grounds for testing based
upon reasonable suspicion.
A supervisor needs to discuss his/her
observations with HR before approaching or
confronting an employee.© 2015 The Weston Group
All Rights Reserved.
Supervisor Responsibility
Knowing AND communicating our policy
Tracking employee work performance
Documenting and discussing changes with employees
Discussing any suspicions of substance abuse with HR
Assisting with disciplinary action
Following up with a referral to the Employee Assistance
Plan.
© 2015 The Weston Group All Rights Reserved.
Drug & Alcohol Policy
Review & discuss draft policy
© 2015 The Weston Group All Rights Reserved.
Goosmann Law Firm’s Guide to the Affordable Care Act:
How Does It Affect Small BusinessesSCOTT LEUNING
101 South Reid Street, Suite 307Sioux Falls, SD 57103
(605) [email protected]
QUESTIONS?
SHORT BREAK
AGENDA
Overview of Affordable Care Act.
Key Elements that Affect Small Businesses
◦ Businesses with less than 25 employees
◦ Businesses with less than 50 employees
◦ Businesses with more than 50 employees
Questions
OVERVIEW OF ACA
It’s been a law for five years.
It’s faced legal challenges
It’s faced political challenges
It’s still here…
AFFORDABLE CARE ACT:
MYTH v. FACT
Affordable Care Act: Myth v. Fact
Myth: All employers are required to buy
health insurance for employees under the ACA.
Affordable Care Act: Myth v. FactMyth: All employers are required to buy health
insurance for employees under the ACA.
Fact: The ACA does not require businesses to provide health insurance for their employees.◦ 2015 businesses with 100 or more full-time employees or full-time
equivalent (FTE) employees that do not provide coverage to their full-time employees may be subject to an Employer Shared Responsibility payment.
◦ In 2016 that threshold drops to companies with 50 or more full-time employees or FTE employees.
◦ 96 percent of companies in United States have less than 50 employees and therefore are not subject to the rules of the ACA.
Affordable Care Act: Myth v. Fact
Myth: Since my state hasn’t set up its own health
exchange, the health care law doesn’t apply to me.
Affordable Care Act: Myth v. FactMyth: Since my state hasn’t set up its own health
exchange, the health care law doesn’t apply to me.
Fact: Every state has a health insurance marketplace.◦ The marketplace may be run by the state or federal
government, or a partnership of both.◦ Insurance plans in the Marketplace are offered by private
companies and all plans will cover the same core set of benefits, called Essential Health Benefits.
◦ No plan can turn you or your employees away because of a medical condition.
Affordable Care Act: Myth v. Fact
Myth: The Affordable Care Act is causing health
insurance rates to rise.
Affordable Care Act: Myth v. FactMyth: The Affordable Care Act is causing health
insurance rates to rise.
Fact: ACA contains a number of provisions to slow health care costs.◦Insurance companies must publicly disclose & justify
premium rate hikes of 10% or more.◦Insurers must spend 80% of premium costs on medical
care. (must refund the difference if they don’t).◦Since ACA passed premiums have grown at less than 5%
annually. In 2014 that rate was 1.7%.
HEALTH INSURANCE PREMIUMS UNDER AFFORDABLE CARE ACT
Before the Affordable Care Act (ACA), small businesses paid on average 18% more in premiums than their larger competitors for the same benefits. The ACA helps small employers by lowering premium cost growth and increasing access to quality, affordable health insurance.
REDUCTION OF PREMIUM GROWTH RATE
Before ACA:
Fewer choices Higher premiums and
unpredictable rate increases Higher rates for groups with
women, older workers & those with chronic health concerns
Waiting periods or no coverage for pre-existing conditions.
Under ACA ins. companies:
Must spend 80% of premiums on actual medical care
Must disclose and justify rate hikes of 10% or more
Can’t charge higher rates or deny coverage because of pre-existing conditions
Can’t charge higher rates for women or older employees
Must pool risks across small groups No annual limits on coverage Must provide core package of
“essential health benefits”
ACA MAKING A DIFFERENCE
6.6 million young adults have coverage through parents’ plans.
17 million children cannot be denied coverage due to pre-
existing conditions.
15 million Americans cannot be dropped by their insurance
companies.
6.1 million seniors saved over $5.7 billion in prescription drugs.
Use of electronic records has increased.
HOW WILL ACA IMPACT
SMALL EMPLOYERS?
HOW WILL ACA IMPACT SMALL EMPLOYERS?
It depends on size of employer.
How many employees does the employer have?
Number of Full-Time
Equivalent (FTE)
employees
Up to 50
24 or fewer
50 and above
CALCULATING NUMBER OF FTEs IN YOUR BUSINESS
Use the most recent year.
Exclude seasonal employees (those who
work less than 120 days a year).
Count the number of people who worked an
average of 30 or more hours per week.
Add to this amount the number of hours
worked per week by non-full time employees
and divide by 30.
CALCULATING NUMBER OF FTEs IN YOUR BUSINESS
Mike owns a business with 20 employees. He has:
15 employees working average of 40 hours/week2 employees working average of 15 hours/week1 employee working average of 25 hours/week2 employees working average of 27 hours/week
Full time employees = 15Non full-time hours (15+15+25+27+27) 30 = 3.6 (always round down for FTEs) 3Mike has 18 FTEs
24 OR FEWER EMPLOYEES:
SMALL BUSINESS HEALTH CARE TAX CREDIT
EMPLOYERS WITH 24 OR FEWER FTE EMPLOYEES
May qualify for tax credit to offset costs:
• Average annual wages below $50,000, and
• Contribute uniform 50% or more toward employees’ self-only premium costs
Maximum tax credit employers with 10 or fewer FTE and average annual wages less than $25,000.
Number of Full-Time
Equivalent (FTE)
employees
Up to 50
24 or fewer
50 and above
SMALL BUSINESS HEALTH CARE TAX CREDIT
2010-2013 up to 35% of small employer’s premium
contribution.
2014 and beyond, credit increased to 50% (35% for
tax exempt employers).
◦ To take advantage of the credit, employees must enroll in
coverage offered by employer through one of the SHOP
certified plans.
◦ Credit can be claimed for any 2 consecutive taxable years
beginning in 2014 (or beginning in a later year).
SMALL BUSINESS HEALTH CARE TAX CREDIT
Employer has 24 or fewer
FTE employees
Employer pays uniform amount of at least 50% of premium for
employee
Employees; average
annual wages are less than
$50,000
Up to *50% Federal Tax Credit in 2014 if for-profit entity
*SHOP participants only
UP TO 50 EMPLOYEES:
The Federally-Facilitated
SHOP Marketplace
EMPLOYERS WITH UP TO 50 FTE EMPLOYEES
• If employer chooses to offer coverage, you may do it through Small Business Health Options Program (SHOP)
• Enhanced SB Health Care Tax Credits available for employers with 24 or fewer employees participating in SHOP
Number of Full-Time
Equivalent (FTE)
employees
Up to 50
24 or fewer
50 and above
What is the Federally-Facilitated SHOP Marketplace?
The Small Business Health Options Program Health Insurance Marketplace created by the ACA Offers small employers a choice of qualified health and dental
plans and tools for making informed choices. Gives eligible small employers access to Small Business Health
Care Tax Credit—worth up to 50% of employer’s premium contributions.
Works with new insurance reforms to create competition on price and quality.
Offers online purchase and enrollment.
Note: Employers with fewer than 50 full-time equivalent employees, aren’t required to offer health insurance, and there’s no penalty if they choose not to.
Who Can Purchase SHOP Coverage?
(1) Must have 50 or fewer full-time equivalent (FTE) employees.
With at least one employee who is not a co-owner or spouse;
Including tax-exempt and religious employers;Offer health insurance coverage to all full-time
employees
Who Can Purchase SHOP Coverage?
(2) Must Offer health insurance coverage to all full-time employees.
Generally these are employees working 30 hours or more per week.
Do not need to offer coverage to your part-time employees (those working 29 hours or less per week).
Who Can Purchase SHOP Coverage?
(3) At least 70% of your full-time employees must enroll in the SHOP Plan. (75% in South Dakota and Iowa)
Employees with coverage through another employer plan, Medicare, Medicaid, the military, or veteran’s programs are not included in calculation.
EXAMPLE OF 75% PARTICIPATION CALCULATION
You offer coverage to 16 full-time employees.2 have coverage through a spouse’s employer1 is covered by Medicare1 is covered by Tricare16 employees total, minus 4 who aren’t included = 12 employees who count toward the 75% requirement.
75% of 12 employees = 9
At least 9 of your employees must enroll to qualify for SHOP plan.
EXCEPTION TO 75% PARTICIPATION REQUIREMENT
If you can’t meet the minimum participation rate you can apply for coverage from November 15 through December 15 every year. This is designed to let employers that don’t meet the participation rate offer a SHOP plan.
BROWSE BEFORE BUYING
Online tool shows price estimates for Federally-facilitated SHOP
Qualified Health Plans and Qualified Dental Plans.
Price estimates are based on the age-ranges of employees and location
of business.
Agents, brokers or Navigators can help employers use this tool.
Employers can get final quotes for 2015 coverage as part of online
enrollment process on HealthCare.gov
New Features of FF-SHOP in 2015
Small employers can access SHOP online (HealthCare.gov)◦ Browse, select and offer employees health and dental coverage◦ Have employees enroll in SHOP coverage online◦ Find and authorize a SHOP broker to help with online enrollment
No paper application will be accepted
SHOP-registered agents and brokers can access online features and manage accounts when authorized by clients
50 OR MORE EMPLOYEES:
Employer Shared Responsibility for Employee Health Insurance Coverage
EMPLOYERS WITH 50 OR MORE FTE EMPLOYEES
• In 2015 there are various types of transitional relief available for employers with 50-99 full-time/full-time equivalent employees.
Number of Full-Time
Equivalent (FTE)
employees
Up to 50
24 or fewer
50 and above
MOST SMALL FIRMS ARE EXEMPT
ACA exempts all employers that have fewer than 50 full-time employees (including FTEs) from employer shared responsibility provisions.
That exempts about 5.8 million out of 6 million firms.
Those 5.8 million firms employ nearly 34 million workers
2015 PHASE-IN PERIOD
The employer responsibility provision will apply to firms with 100 or more full-time employees starting in 2015.
This provision will expand to employers with 50 or more full-time employees starting in 2016.
TWO SCENARIOS FOR POTENTIAL PAYMENT
EITHER(1) An employer does not offer coverage to at least 95%*
of its full-time employees (and dependents) OR(2) The coverage offered to employer’s full-time
employees is not “affordable” or does not provide “minimum value” or particular full-time employee was not offered coverage. AND
At least one full-time employee receives a premium tax credit in the individual Marketplace.* For 2015, replace 95% with 70%
Coverage Provides Minimum Value
Coverage Is Affordable
• Plan must cover, on average, at least 60% of the plan’s total cost of incurred benefit.
• HHS and IRS have an online calculator employers can use to input their plan details and determine if it meets the 60% value threshold.
Coverage is unaffordable if the full-time employee’s share of the lowest cost self-only coverage that provides minimum value costs more than 9.5% of employee’s annual household income.Affordability safe harbor: If the cost to the employee of a self-only plan is not more than 9.5% of employee’s wages as reported on Box 1 of the W-2, it’s deemed affordable for purposes of Employer Shared Responsibility.
Penalty if Coverage Not Offered to Enough Employees
Payment applies if any full-time employee receives a premium tax credit for coverage purchased in the individual Marketplace.
Payment owed: $2,000/year times number of full-time in excess of 30 (in excess of 80 for 2015).
Payment is calculated separately for each month for which coverage not offered ($166.67/month).
Payment is based on employer’s number of full-time employees for that month.
Penalty if Coverage Is Not Affordable or Doesn’t Meet Minimum Value
Payment owed: $3,000/year per full-time employee who receives a premium tax credit for coverage purchased in the individual Marketplace.
Payment is calculated on monthly basis ($250 per month).
Key Points Regarding Penalties Penalties depend on whether employer offers coverage and the
quality of that coverage, rather than whether an employee accepts the offer of coverage.
No payment is owed for part-time employees even if they receive a premium tax credit.
Only receipt of the premium tax credit in the individual Marketplace triggers these payments. If employee obtains coverage from another source no penalty.
Employers that offer coverage to full-time employees must also offer coverage to dependents of those full-time employees under age 26 (coverage of spouse not required).
How to Avoid Penalty Payments
To avoid a payment for failing to offer health
coverage, employers need to offer coverage to 70
percent of their full-time employees in 2015 and
95 percent in 2016 and beyond.
Incentives for Continuing to Offer Health Insurance Coverage
The cost of providing health insurance coverage is tax deductible by the employer. Employer shared responsibility payments are not tax deductible.
Employers offering health insurance coverage can tailor that coverage to provide the benefits most valued by your employers and maintain a competitive advantage in recruiting and retaining employees.
Questions?
SCOTT LEUNING
101 South Reid Street, Suite 307
Sioux Falls, SD 57103
(605) 371-2000
The Weston Group101 South Reid Street
Suite 307Sioux Falls, South Dakota 57104
Office (605) 275-4747
www.TheWestonGroup.com