Viewing posts from: February 2016

ADA and FMLA Overlap Guidance

Posted February 26, 2016 by Megan DiMartino

Football strategy on board with a male hand drawing a pass between players.Once the Americans with Disabilities Act (ADA) was lengthened, courts have now ruled that employers have to take into reason to offer additional leave as reasonable accommodation for employees who are disabled once they exhaust their Family and Medical Leave Act (FMLA) allocation. However, employers have not been given an abundant amount of guidance on when and where the accommodation needs to be applied. There are a few key highlights for employers to help them keep in compliance with an FMLA/ADA overlap:

  • In order to prevent employers from having problems, they need to communicate with employees out on FMLA leave before, during, and after leave.
  • They should also determine whether or not extra leave is reasonable.
  • Also, manager training is very important. Having a thorough training for managers is a great way to avoid FMLA and ADA compliance issues.

Many employers only assess undue hardship, or additional leave, for employees on FMLA after the leave has been exhausted. This can be a problem, as assessment of additional leave can begin on day one of the employee’s FMLA leave. Employers that make assessments for additional leave during the scheduled leave have a higher chance of proving that additional leave can create undue hardship.

There are also factors that assist employers when denying additional leave as a reasonable accommodation. Some of these factors include lost sales, lower quality, deferred projects, and increased stress on overburdened co-workers. Employees that have a lower morale should not be a consideration when factoring in for undue hardship analyses.

Source: HR Morning | Some Real Guidance on Where ADA and FMLA Overlap

For more information contact The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.

IRS Clarification on ACA Safe Harbors

Posted February 23, 2016 by Megan DiMartino

IRS-logoAt the very end of 2015, the IRS jolted into high gear mode. The IRS pushed back a few deadlines for the 2015 Affordable Care Act (ACA) reporting. This was a holiday blessing for employers that were still trying to keep up with the huge record keeping requirements. The IRS also issued a much desired explanation on income percentages for ACA’s affordability safe harbors. For the Revenue Procedure 2014-37, the IRS increased the percentage of employee household income to 9.56% that can be spent on group health insurance and can still be considered affordable under the ACA. This amount has now increased to 9.66% for 2016. Due to the fact that it can be challenging to establish an employee household income, ACA regulations provide employers to choose any of the three alternate safe harbors when determining whether or not their group health insurance is affordable under ACA. These three alternative safe harbors are: percentage of employee W-2 income, percentage of employee rate of pay, and percentage of federal poverty line. The rate for these safe harbors was set at 9.5% in 26 CFR Section 54.4980H-5.

The problem that arose was that while the standard for affordability was increased for inflation, the percentage for the three safe harbors was stuck at 9.5%. There was no official guidance on whether or not the safe harbor percentage would be bumped up. In the IRS Notice 2015-87, the agency states that the safe harbor percentages are only to be adjusted in cycle with affordability percentages, so now it is 9.66% all across for 2016.

Source: | IRS issues welcome clarification on ACA safe harbors

For more information contact The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.

Guidance on Health Reimbursement Arrangements

Posted February 18, 2016 by Megan DiMartino

paying-cashIn December, the IRS issued Notice 2015-87 which provides guidance on a multitude of Affordable Care Act (ACA) market reforms. One noteworthy item is the compliance issues that were raised by Health Reimbursement Arrangements (HRA). HRAs are group health plans that will reimburse medical expenses for a certain dollar amount. The ACA usually prohibits group health plans from inflicting lifetime or annual dollar limits on health benefits considered essential. Previously, the IRS had indicated that circumstances where employers reimburse their employees for medical related costs are health plans that are subject to the ACA’s market reforms and therefore all reimbursement arrangements must satisfy with the ACA market reforms.

HRAs fail to satisfy specific ACA market reforms, which include required coverage of preventative services or the prohibition on annual/lifetime dollar amounts. IRS guidance has previously explained that if one wants to comply with ACA’s market reforms, then an HRA must be integrated within a group health plan that is compliant with the ACA. Although the IRS rules allow an HRA to be combined with a group health plan not sponsored by an employer who sponsors the HRA, the IRS confirms that an HRA cannot be combined with any individual market plan.

The Notice 2015-87 covers the following compliance issues with the ACA presented by HRAs:

  • HRAs that only cover former employees and/or retirees cannot be combined with the group health plan.
  • A former employee that is covered by an HRA is not eligible for premium tax credits as long as there are funds left in the HRA.
  • Any retiree-only HRA may reimburse market insurance premiums and other individual medical costs.
    • If the retiree-only exemption applies, any unused amounts in the HRA cannot be used to reimburse any premiums paid by former employees for use of individual market coverage, even if the HRA amounts were earned when the HRA was combined with group health plans.
  • Amounts credited to an HRA before 2014 can be used to reimburse medical expenses to the terms in effect prior to 2014 without violating the ACA market reforms.
  • If an HRA that reimburses independent medical expenses for an employee and their spouse/dependents, then that cannot be combined with self-only group health plan coverage and must be combined with coverage that the spouse and dependents are enrolled in order to comply with the ACA requirements.
  • Since this rule will not be enforced by the IRS until 2017, any HRA that reimburses employees for premiums paid in individual market coverage will not disrupt ACA market reforms if the coverage only provides the excepted benefits.
  • If there is an employer payment plan or HRA that is part of a Section 125 cafeteria plan, then it must be combined with a group health plan in order to comply with ACA.
  • An updated Plan Document with ACA reforms must be in place for all HRAs.

Source: The Wagner Law Group | Health and Welfare Law Alert Guidance on Health Reimbursement Arrangements

For more information contact The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.

AP Benefit Advisors Webinar Series – HR vs. Finance: Leveraging Big Data and Technology while Remaining Compliant within Your Benefits Program

Posted February 16, 2016 by Megan DiMartino

HR vs. FinanceJoin AP Benefit Advisors’ Director of Data Analytics, Scott Mayer, and the HRtactix Division’s HR Generalist, Ashley Grupp, for this one-hour, complimentary webinar in the match-up between HR and Finance.

Controlling and managing benefit costs and administration is no easy task. In addition, ACA strain is ever-present causing strife amongst departments. This combination is harmful to the health of your benefits platform. Join us to learn about proven strategies and techniques to curb employee benefit costs, ease administrative burden, and keep employee morale intact.

Topics include:

  • Segmentation and Classes
  • Plan Design and Morale
  • Plan Design, Premium and Employment Incentives
  • Technology Integration

Webinar Details:

  • Wednesday, February 24, 2016
  • 1:00 – 2:00pm EST
  • No Cost to Attend
  • This webinar is open to all HR and Finance Professionals – but not to brokers, agents, TPAs and PEOs.

Register Now Callc Red




DOL FMLA Fact Sheet Regarding Joint Employers

Posted February 12, 2016 by Megan DiMartino

Closeup on business woman giving clipboard for signThe Department of Labor (DOL) recently, but subtly, issued a new Administrator’s Interpretation 2016-1 (AI). This document highlights responsibilities and obligations of joint employers. As a reminder, a joint employer is when two or more employers are responsible individually and jointly for hiring an employee and they are also responsible for compliance with a statute. While the AI focuses on the Fair Labor Standards Act (FLSA), the Fact Sheet #28N that is issued by the DOL focuses on joint employers and their responsibilities under the Family and Medical Leave Act (FMLA). Under FMLA, a joint employer’s relationship exists as one employer being the primary employer and the other is a secondary employer. When determining whether an employer is primary or secondary depends on specific facts within the situation. Factors include: who has the authority to do hiring and firing, who has authority to assign the employee to work, who decides what the amount of pay the employee receives and when they will get paid, and who provides an employee with leave or benefits. As far as staffing agencies are concerned, they are most commonly a primary employer.

The DOL outlines the responsibilities for primary employers as follows: providing FMLA required notices and leave to employees, maintaining any group health insurance benefits in the duration of the FMLA leave, reinstating the employee to their job upon returning from leave, and obtaining all records required by FMLA. The responsibilities of secondary employers differ. First, they are prohibited from interfering with any exercise of FMLA rights by a jointly employed employee, or are prohibited from firing or discriminating against the employee for not agreeing with practices unlawful under FMLA. Second, they are responsible for reinstating the same job to the employee upon return from their FMLA leave. Lastly, they are to maintain a basic payroll and identify employee data with all respect to joint employed employees. There is a chart included with Fact Sheet #28N which details responsibilities for primary and secondary employers.

There are a few insights for employers when dealing with the new AI:

  • Employers should analyze worker arrangements that are not true employer-employee relationships
  • Employers should also ask about FMLA practices and procedures within staffing and labor agencies used by the company to make sure it satisfying all FMLA obligations
  • Employers should also coordinate any FMLA compliance with other employers that employ the same employees
  • Joint employers should not forget about compliance within wage and hour rules created by the FLSA

Source: FMLA Insights | A Big Yawner? DOL Issues FMLA Fact Sheet Regarding Joint Employers

For more information contact The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.

How to Curb FMLA Abuse

Posted February 9, 2016 by Megan DiMartino

FMLA 1Family and Medical Leave Act (FMLA) abuse is common, but there are ways to control it.

The first thing an employer can do is to make sure that employees finish the initial FMLA certification. If an employer has a request for medical certification, an employee has to provide a completed and adequate certification at their expense within 15 days after an employer’s request.

Employers should not accept incomplete or inadequate certifications. A certification is inadequate if the information that is provided is incomplete, unclear or indistinct. An employer should notify the employee, in writing, informing them of what is incomplete and what is required to be fixed.

An employer who has the reason to suspect a flaw in the validity of medical certifications can require that the employee obtain a second opinion at an employer’s expense. An employer can request a recertification from the employee no more than every 30 days and can only be in connection to an absence from the employee. There is one exception to this rule, and that is when the employer obtains information that causes them to suspect the stated reason for absence or validity of the medical certification. The employer can then request a recertification earlier.

Lastly, employees who need FMLA do not have to say the letters “F-M-L-A” when requesting time off. If an employee states enough about their condition to where it informs the employer that the employee needs covered leave, then it should be treated like someone who specifically asks for FMLA leave.

Source: The Employer Handbook by Eric B. Meyer | Migraines! They are the bane of your FMLA world, HR. Amirite?

For more information contact The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.

EEOC Fact Sheet Addressing Discrimination Against Muslim & Middle Eastern Employees

Posted February 5, 2016 by Megan DiMartino

EEOCIn the wake of last year’s terrorist attacks both domestically and internationally, Equal Employment Opportunity Commission (EEOC) addressed workplace discrimination against Muslim and Middle Eastern employees.

The EEOC established two different online question and answer resources for employers and employees. The purpose of these documents are to educate and increase understanding of rights and responsibilities within federal laws that are enforced by the EEOC. The documents act to prevent any type of discrimination, and correct any that may have existed. The employers question and answer document contains information on hiring, background checks, harassment, and accommodation. There are also other resources provided by the EEOC that highlight other important issues within workplace discrimination against religious beliefs. The EEOC recommends training in the workplace to prevent harassment and any other kind of religious discrimination.

The EEOC also highlights additional resources for employers:

Source: The Employer Handbook by Eric B. Meyer | Do You Have Muslim or Middle Eastern Employees? Read This EEOC Fact Sheet

For more information contact The information contained in this post, and any attachments, is not intended and should not be misconstrued as legal advice. You should contact your employment, benefits or ERISA attorney for legal direction.

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