Viewing posts from: May 2016

Medical Marijuana and its Effects on ADA & FMLA

Posted May 27, 2016 by Megan DiMartino

Senior Gent with MedsThe legalization of medical marijuana has passed in a majority of the states, so how does that affect the rights under other laws such as the Family Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA)?

While these two laws give employees certain rights, you must also remember that marijuana use is illegal throughout the United States under federal law – even in those states where its use is legal under state law.

So what about those using marijuana for a medical condition in a state where it is legal? Leave is allowed under FMLA for absences due to treatment of any serious medical condition, which includes any chronic condition. It also allows leave for any serious medical condition which incapacitates a person from work for over 3 consecutive days if they also need to see a medical provider twice for treatment. Using medical marijuana during this time is irrelevant. Also, if your condition requires you to take time off to take medical marijuana, that time off would be covered by FMLA.

But an issue that arises with that is employers with a zero tolerance drug policy. Generally, an employer can enforce its drug free workplace against off duty marijuana use, because as already stated, marijuana use is still illegal under federal law. So, even if an employee is not high or impaired, if they test positive for recent marijuana use, the employer could terminate under their zero tolerance drug use policy. But the employee could argue that the termination was in retaliation for their use of FMLA, or an attempt to interfere with their FMLA use.

Now for ADA policies. The ADA currently states that a person using illegal drugs is not a qualified individual with a disability and thus is not protected by the ADA. Also, testing for illegal drugs is not considered a medical examination, so the ADA does not restrict when an employer can test for illegal drug use. Under the ADA, illegal drug use does not include use of drugs “taken under supervision by a licensed health care professional, or other uses authorized by the Controlled Substances Act or other provision of Federal law.” So while medical marijuana can be prescribed legally under some state laws, it is still considered illegal under the Federal Controlled Substances Act.

And to top it all off, many states have their own “mini” ADA and FMLA statues which are not always identical to the federal ADA and FMLA laws. State ADA and FMLA laws could give further protection to medical marijuana users since the state law may not refer to the Federal Control Substances Act.

Courts are only starting to delve into this, so medical marijuana users are not out of the woods yet! And employers need to assess their risk before acting as the ADA and FMLA may extend some protection to those users.

Source: Seyfarth Shaw – The Blunt Truth | ADA, FMLA and Medical Marijuana, How Do They Mix?

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.

DOL Issues New Poster and Guide

Posted May 25, 2016 by Megan DiMartino

fmla poster 2016New FMLA Poster

Under the Family Medical Leave Act (FMLA), an FMLA-covered employer must post a copy of the General FMLA Notice in all locations where it has any employees, regardless if they are FMLA eligible or not. The FMLA rules state the notice must be posted “prominently where it can be readily seen by employees and applicants for employment.”

The DOL released a new General FMLA Notice, but advised that no new information was added. It was simply reorganized to make it more reader friendly. It was confirmed that employers will be allowed to post either the current poster or the new version.

New Employer FMLA Guide

In 2012, the DOL issued a guide to employees to help them navigate their rights under the FMLA. Now the DOL has released a companion guide for employers. According to the DOL, the Employer’s Guide to the Family and Medical Leave Act is designed to “provide essential information about the FMLA, including information about employers’ obligations under the law and the options available to employers in administering leave under the FMLA.”

This is more of a guide of the whole process of FMLA administration from beginning to end and follows the typical leave process. It covers common answers to FMLA questions, but does not get too deep into all leave issues.

Source: FMLA Insights | DOL Issues New FMLA Poster and Publishes Guide to Help Employers Administer FMLA

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.

DOL’s Final Rule on Overtime Regulations

Posted May 23, 2016 by Megan DiMartino

hero_healthreform_signing_PS-0386On May 18, 2016, President Obama and Secretary Perez announced the publication of the Department of Labor’s (DOL) final rule on updating the overtime regulations. Since 2014, President Obama has been pushing for every worker’s right to be compensated fairly for their hard work.

Key Provisions to the Final Rule

The Final Rule focuses on updating the salary and compensation levels needed for Executive, Administrative and Professional workers to be exempt. Specifically, the Final Rule:

  1. Sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South ($913 per week; $47, 476 annually for a full-year worker);
  2. Sets the total annual compensation requirement for highly compensated employees (HCE) subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally ($134,004); and
  3. Establishes a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

The Final Rule also amends the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the new standard salary level.

The effective date is December 1, 2016.

Source: United States Department of Labor – Wage and Hour Division (WHD) | Final Rule: Overtime

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 Wellness Rules Update

Posted May 17, 2016 by PHaynes

EEOC_1024x341Today, the EEOC released its final rule with regard to employer wellness programs and the ADA (and a final rule with regard to those same programs and GINA).

These final rules go into effect on the first day of the first plan year beginning on or after January 1, 2017, and apply to all Employer-Sponsored wellness programs.  This includes wellness programs that are not affiliated with, tied to, or associated with the employer’s sponsored health insurance/coverage programs and plans.

The White House Office of Management and Budget on Thursday, May 12, 2016 completed its review of the EEOC’s regulations clarifying the application of federal anti-discrimination laws to workplace wellness programs.  These regulations are (or were) intended to better streamline the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act with the PPACA (aka the Affordable Care Act). Under PPACA, the incentive (or penalty) for participating (or not participating) in a wellness program typically may not exceed 30% of a group health plan.

The EEOC proposed the regulations after it came under fire from the business community in 2014 for suing three companies, alleging their wellness programs violated the ADA because financial incentives were too high and forced employees to provide medical information. (Please see our prior webinars/blog detailing those cases, under the Links, below).  Under federal law, companies may not ask employees for their medical information, unless that information is job-related and consistent with business necessity. However, there is an exception for voluntary wellness programs. In response to the lawsuits, the business community asked the EEOC to clarify when a wellness program is considered “voluntary.”

In April 2015, the EEOC proposed a rule that said a wellness program is ADA-compliant as long as companies do not offer incentives that exceed 30% of the cost of employee-only coverage. In October 2015, the EEOC proposed another rule that said a wellness program is GINA-compliant if financial incentives for an employee and his or her spouse to participate do not exceed “30% of the total annual cost of coverage for the plan.”

So, what has changed under the new rules released today?

Compliant Employer-Sponsored Programs must clearly tell employee-plan-participants (in a clear and concise notice):  (a) what medical information the employer/Plan will obtain, (b) how that information will be used, and (c) what restrictions exist regarding the disclosures exist.  Many employers/Plan Sponsors with robust wellness offerings already comply with these requirements, and will therefore already comply with the ADA (and GINA since many, if not all, plans already stripped out questions designed to elicit genetic information from tools like Health Risk Assessments, whenever there was a financial incentive or penalty attached to its completion).

Confidentiality Requirements

The final rules include two (2) additional ADA-Confidentiality requirements.  They are:

  1.  [Employers] may only receive information collected by a wellness program in aggregate form that does not disclose, and is not reasonably likely to disclose, the identity of specific individuals except as necessary to administer the plan; and
  2. [Employers] may not require an employee to agree to the sale, exchange, transfer, or other disclosure of medical information or to waive confidentiality protections under the ADA in exchange for an incentive or as a condition for participating in a wellness program, except to the extent permitted by the ADA to carry out specific activities related to the wellness program.

For additional assistance with your Wellness Plans, please contact your Account Executive or Account Manager.



10 Rules to Prevent Employment-Related Lawsuits

Posted May 11, 2016 by Megan DiMartino

  1. Check list. Vector illustration EPS version 8.Conduct thorough background checks on applicants
  • Not all evidence, such as fraud convictions, dishonesty and violence, is a disqualifying factor when hiring a new employee, but it can be instrumental in determining if an applicant is a good fit for your company.
  1. Provide accurate and adequate references for ex-employees
  • The general rule is to provide neutral references for former employees, such as dates of employment and wages. But there are exceptions to that rule. For example, an employee that was fired for violently attacking a co-worker may present a future risk. Withholding that information from another employer can expose your organization to liability. If you intend to provide a more detailed reference, get a release from the former employee in advance.
  1. Consistently follow progressive discipline policies
  • Treating someone differently (based on sex, race, age or other distinguishing characteristics) than somebody else for the same behavior is one of the most prevalent claims and the key to minimizing and defending those claims is consistent discipline within the same department – and even better, throughout the whole organization.
  1. Keep personnel policies and manuals up to date
  • Review your policies and update your employment manuals at least every three years so as to stay current with the every changing laws. If the law changes in a way that affects a particular policy, quickly issue a supplement to the employee handbook.
  1. Coordinate decisions and responses to the government
  • A single employee and single incident can raise racial discrimination with the EEOC, a violation of the FMLA with the DOL, and claim unsafe working conditions with OSHA. HR should be designated to address all of these issues, as allowing multiple departments to respond separately can lead to fatal inconsistencies that could be impossible to explain should the matter end up in front of a jury.
  1. Train supervisors on the policies and the law
  • Front line supervisors can find themselves in dangerous positions by “speaking for the company” on personnel issues. If HR doesn’t provide basic training on those issues, the company could potentially be held liable and pay expensive employment law violations. Provide basic HR training to supervisors upon hire and at least once a year.
  1. Avoid making promises that turn into contracts
  • Make sure your supervisors and managers know not to make statements, such as “as far as we’re concerned, you’ll have this job as long as you want it,” that offer terms and conditions of employment outside what an employee’s job description normally allows.
  1. Take complaints of harassment seriously
  • Having a detailed harassment policy may not be enough to hold up in court; for it to truly be effective as a defense, you must follow it and enforce it fairly and consistently. If you receive a harassment complaint, move quickly to investigate it and impose appropriate and consistent discipline.
  1. Comply with record-keeping requirements
  • To avoid investigations and fines, know which documents you must keep and make sure you can easily retrieve them – whether in paper or electronic form.
  1. Anticipate possible litigation and act appropriately 
  • Supervisors, managers and HR should all be trained to recognize the signs of a potential lawsuit. Repeated requests to view disciplinary or personnel files, strongly worded objections to annual evaluations and “legalistic” sounding emails or memos sent to a supervisor or HR are all signs that an employee is contemplating legal action. HR should get ahead of the problem by seeking legal advice and taking quick and coordinated steps to prepare for a claim.

Source: Business Management Daily – Human Resources | The 10 rules every HR professional must know

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: Long Term Care Plans as an Employee Benefit

Posted May 6, 2016 by Megan DiMartino

beautiful young medical nurse talking to senior patient

Join AP Benefit Advisors’ Director of Voluntary Benefits, Stephen Ivey, and Capitol Metro Services’ Director of LTC Brokerage, Jeffrey V. Merwin, as they delve into the changing world of long term care plans. This webinar will explore the need for long term care, the markets for multi-life plans, employer contribution strategies, and various education and enrollment options.

Topics will include:

  • Innovative employer contribution strategies
  • Employee enrollment options
  • Recruitment and retention impact
  • Impact on workplace productivity
  • Tax treatment and potential advantages

Webinar Details:

  • Wednesday, May 18, 2016
  • 1:30 – 2:30pm EDT
  • No Cost to Attend
  • This webinar is open to all HR and Finance Professionals – but not to brokers, agents, TPAs and PEOs.

Register Now - CA Blue

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.

Updates from the IRS, DOL and HHS – 2017 HSA Limits and More. Agencies Provide Guidance on Preventive Services, Rescissions, Mental Health Parity, and More

Posted May 2, 2016 by PHaynes

PPACA Compliance

As April began to close out, the DOL, HHS, and IRS jointly issued FAQs with guidance on several health care reform requirements, along with mental health parity and the Women’s Health and Cancer Rights Act (WHCRA). Here are the highlights in order of the Questions and Answers.

Preventive Services (Questions/Answers 1 & 2).  Q/A-1 confirms that the required preparation for a preventive screening colonoscopy is an integral part of the procedure and must be covered without cost-sharing, subject to reasonable medical judgment. This includes bowel preparation medications when medically appropriate and prescribed by a provider.   Q/A-2 allows plans, as part of utilizing reasonable medical management techniques (see our article), to develop a standard exception form that providers may use to prescribe particular services or FDA-approved items based on a medical necessity determination for an individual. The Medicare Part D Coverage Determination Request Form may be used as a model for this purpose.

Rescissions (Q/A-3). This Q/A describes a fact pattern involving a teacher who was employed under a ten-month contract from August 1 to May 31 but had health coverage for the entire August 1–July 31 plan year. (The teacher had fully paid premiums during this period and had not committed fraud or intentional misrepresentation.) According to the FAQ, if the teacher resigned on July 31, termination of coverage retroactive to May 31 would constitute a prohibited rescission. The plan could, however, terminate coverage prospectively, subject to other applicable laws.

Out-of-Network Emergency Services (Q/A-4). This Q/A confirms that plans are generally required to disclose (upon request) how they calculate payments for out-of-network emergency services (e.g., the UCR (Usual, Customary, and Reasonable) amount to comply with ERISA’s disclosure provisions, as well as health care reform’s appeals process and external review requirements.

Clinical Trials (Q/As-5 & -6).  If a plan generally covers chemotherapy to treat cancer, it may not limit that coverage for chemotherapy provided in connection with an individual’s participation in an approved clinical trial for a new anti-nausea medication. Similarly, if a plan typically covers items or services to diagnose or treat certain complications or side effects, the plan may not deny coverage of these items or services to diagnose or treat complications or side effects in connection with an approved clinical trial. The agencies also confirm that the nondiscrimination requirement relating to participation in clinical trials is self-implementing and, until further guidance is issued, plans are expected to follow a good faith, reasonable interpretation of the law (see our article).

Cost-Sharing Limits (Q/A-7).  Prior FAQ guidance addresses how the overall cost-sharing limit applies to plan designs that use reference-based pricing (i.e., where the plan pays a fixed amount for a particular procedure and providers accept it as payment in full). Consistent with that guidance, if a plan merely establishes a reference price without using a proper method to ensure reasonable access to quality providers, the plan will not be considered to have established an adequate network and would be required to count an individual’s out-of-pocket expenses for providers who do not accept the reference price toward the maximum annual out-of-pocket limit.

Mental Health Parity (Q/As-8 through -11).  Clarification is provided as to how to perform the “substantially all” and “predominant” tests for financial requirements and quantitative limitations under the mental health parity requirements. The agencies note that these requirements apply to any benefits a plan may offer for medication-assisted treatment for opioid use disorder. The agencies also address disclosure requirements relating to providers and the individual insurance market.

Reconstructive Surgery After Mastectomy Under WHCRA (Q/A-12).  The WHCRA protections require that the plan provide coverage for nipple and areola reconstruction (including nipple and areola re-pigmentation to restore the physical appearance of the breast) as a required stage of breast reconstruction.

2017 HSA Limits set by IRS on April 29, 2016

With IRS Rev. Proc. 2016-28, they IRS provided for a mere $50 increase in the amounts that a single person in an HSA-compatible HDHP may defer into his/her Health Savings Account.  All other limits, amounts and features remain as they were with 2016’s limits.










4 Key Tips for ACA Guidance

Posted May 2, 2016 by Megan DiMartino

IRSThe IRS recently released guidance on a number of issues under the Affordable Care Act (ACA). These tips range from information reporting penalties to cafeteria plan flex credits.

Information reporting penalties: The IRS States that if you make a good-faith effort to comply with the information reporting requirements then you won’t be penalized if your forms are incorrect or incomplete, but they don’t state what is considered a good-faith effort. With that being said, you may still qualify for penalty relief if you don’t meet the good-faith standard if you have reasonable cause for your errors.

Affordability safe harbors: For 2016, group benefits are considered affordable to employees if they don’t exceed 9.66% of their household income. The IRS created three optional affordability safe harbors for employers. Group benefits are affordable if they don’t exceed:

  • 9.5% of the W-2, Box 1 amount;
  • 9.5% of employees’ rate of pay; or
  • 9.5% of the federal poverty line.

Note: While the rate for employees’ household income is adjusted for inflation, the rate under the safe harbors was stuck at 9.5%. The IRS now says that both rates are the same.

Cafeteria plan flex credits: Employer flex credits reduce the amount that employees have to pay for benefits. These credits figure into whether benefits are affordable if employees can’t opt to receive the credits as a taxable benefit as well as if they may use them to pay for group health benefits that qualify as deductible under tax code Section 213. Flex credits that don’t meet the criteria, such as flex credits available for non-health care benefits or cash, don’t reduce employees’ contributions and thus don’t count toward affordability.

Transition relief: You won’t be liable for a free-rider penalty for offering unaffordable benefits if flex credits employees may use for non-health care benefits may also be used to reduce their monthly contributions, but only for plan years beginning before January 1, 2017. This relief isn’t available if the flex contribution arrangement offering non-health benefits was adopted after December 16, 2015, or an existing flex contribution arrangement is amended so that the flex contribution is significantly increased.

For coverage for plan years beginning before January 1, 2017, you may reduce the amount of employees’ contributions by the amount of a non-health flex contribution for purposes of Form 1095-C, Line 15 reporting. Since treating non-health flex contributions as reducing employees’ contributions may impact their eligibility for a premium tax credit, the IRS is encouraging you not to report this on Form 1095-C. If you don’t report the reduced amount on the form and an employee still qualifies for a premium tax credit, you won’t be on the hook for a free-rider penalty; you will have the opportunity to show the IRS that your’re still entitled to this transition relief.

Source: Business Management Daily – Human Resources | IRS releases a potpourri of ACA guidance: 4 keys

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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