June 2013
Welcome!
Summer is just around the corner! Take a moment to look ahead and see what is in the forecast for upcoming labor law development, enacting workplace summer hour programs and tips to ensure that your business is in compliance.
HR Alerts
US Appeals Court Strikes Down NLRB Notice: On May 7, 2013, the United States Court of Appeals for the District of Columbia struck down the National Labor Review Board’s (“NLRB”) notice rule, which requires private sector employers under its jurisdiction to display a large poster notifying employees of their rights under the National Labor Relations Act, because: (1) it violates employers’ rights to engage in non-coercive speech; and (2) the tolling provision of the poster rule, which tolled the six-month limitations period for filing unfair labor practice charges, was not supported by any authority. The NLRB’s August 2011 rule made the failure to display the notice an unfair labor practice under the NLRA. Unless and until the United States Supreme Court says otherwise, employers have no obligation to post notices of employee rights under the NLRA.
Notice of Exchanges and Subsidies: The US Department of Labor has released its Model Notices for an important, upcoming employer Health Care Reform requirement. Virtually all employers, regardless of size, are required to distribute a Notice of Exchanges and Subsidies to each employee (regardless of part-time, full-time or health plan enrollment status) by October 1, 2013. Also, beginning on October 1, 2013, this notice must be provided to each new employee within 14 days of the employee’s start date.
There are two model notices available, one for employers that offer a company-sponsored health plan to some or all employees, and one for organizations that do not provide an employer-sponsored health insurance plan. Both of these model notices are available for download in the HR Support Center “Essentials” tab under the “HR Forms” section.
The purpose of the Notice of Exchanges and Subsidies is to inform employees of the existence of Health Insurance Exchanges (also called Health Insurance Marketplaces) as well as potential federal subsidies available to them in 2014. The Exchanges are government-provided virtual marketplaces intended to offer individuals and small groups “one-stop shopping” to find and compare private health insurance options. Open enrollment for health insurance coverage through the Health Insurance Marketplaces begins October 1, 2013 and coverage is available beginning on January 1, 2014.
Notice of Exchanges and Subsidies: Deadline Published
Employers have an important and far-reaching compliance deadline on the horizon. Virtually all organizations, regardless of size, are required to distribute a Notice of Exchanges and Subsidies to each employee (regardless of part-time, full-time, or health plan enrollment status) by October 1, 2013. Additionally, beginning on October 1, 2013, this notice must be provided to each new employee within 14 days of the employee’s start date. Whether or not your state has opted to set up a State Exchange, participate in a State-Federal Partnership Exchange, or default to a Federally-Run Exchange, each employer is still required to provide this notice.
The U.S. Department of Labor recently published model notices for this purpose. There are two model notices available: one for employers who offer a company-sponsored health plan to some or all employees and one for organizations who do not offer a health insurance plan. Both of these model notices are available for download in the HR Support Center “Essentials” tab under the “HR Forms” section.
The purpose of this notice is to inform employees of the existence of Health Insurance Exchanges (also called Health Insurance Marketplaces) as well as the potential federal subsidies available to them beginning in 2014. The Exchanges are government-provided virtual marketplaces intended to offer individuals and small groups a “one-stop shopping” resource in order to find and compare private health insurance options. Open enrollment for health insurance plans through these Marketplaces is scheduled to begin on October 1, 2013 and coverage is anticipated to be available beginning on January 1, 2014.
If your company has more than 50 full-time equivalent employees, it is time to carefully consider how your organization intends to comply with the Employer Mandate or whether it determines that non-compliance is the best strategic option. Whether your organization will face Employer Mandate penalties depends on whether your current plan design and employer contribution meet the minimum requirements, and whether any of your employees will be eligible for a federal premium subsidy. Your decision in this regard will affect the information contained in this notice.
Both of the model notices include a section that the employer must complete. If your company does not offer health insurance coverage, and is certain it will not be offering it in 2014 as well, it may wish to go ahead and begin distributing these notices. However, if your organization does offer health insurance, it may wish to wait until closer to the deadline for distribution, as the company may have attained more information regarding the parameters and costs of the company-sponsored health plan at that time.
Additionally, it is necessary that your organization has a resource available to answer employee questions arising from these notices.
For more information, we suggest you review the “Notice of Exchanges and Subsidies: FAQs” document in the HR Support Center. To download, visit the “Benefits” tab, under the “Health Care Reform” page.
Should you have questions regarding the Employer Mandate or this notice requirement, please reach out to your Health Plan Broker or your Human Resources Professional.
Question & Answer
Non-Discretionary Bonuses for OT
Q: I heard that we have to include overtime in our bonuses payments for nonexempt employees. Is this true?
A: Yes, this is true if the bonus is a non-discretionary bonus in accordance with the federal definition contained in the Fair Labor Standards Act (FLSA).
A non-discretionary bonus is one that is governed by a policy or is based on performance. Generally, the incentive is considered non-discretionary if the employer sets the standards that are required to receive a bonus based on meeting job or assignment-specific criteria. Some examples of non-discretionary bonuses are incentive plans, commission plans, shift differentials, productivity bonuses and attendance bonuses.
Conversely, elective bonuses are those that are provided completely at the discretion of the employer at irregular intervals. The employee generally has no expectation of receiving such a bonus. For a bonus to be considered discretionary, the incentive amount, its eligibility requirements, as well as its timing are not disclosed in advance, as they generally are not known. Some good examples of discretionary bonuses are a holiday bonus or a one-time bonus for an employee in recognition of exceptional job performance.
Non-discretionary bonus amounts must be included in the calculation of the regular rate for overtime compensation purposes. However, it is important to note that it must be included in the regular rate for each pay period in which the bonus was based, not on the pay period in which the bonus is paid. For example, for a quarterly attendance bonus, when the bonus amount is ascertained, the employer is required to recalculate the regular rate for each workweek in the bonus period and pay additional overtime. The recalculation of the regular rate for overtime purposes is only required for workweeks in the bonus period in which the employee received overtime pay. Here is a sample calculation:
Tommy (an hourly, nonexempt employee) earns a quarterly attendance bonus of $200. During that quarter, Tommy worked 480 straight time hours and 200 overtime hours in total. The bonus causes Tommy’s regular rate to increase by $.29/hour ($200 bonus divided by 680 total hours). For every overtime hour Tommy has worked during the quarter, he must be paid an additional 14.5 cents (half time rate). The portion that must be added to the bonus to account for overtime is $29 (200 overtime hours x 14.5 cents). Therefore his bonus including the overtime premium becomes $229.
This is an area of the law that many employers fail to understand and consequently fail to compensate employees correctly. Should you have questions regarding such calculations, please contact your Human Resources Professional.
Sexual Harassment: Don’t Lean into My Cubicle Like That!
Sexual harassment is, by definition, a type of discrimination which includes gender-based harassment, bullying, or coercion of a sexual nature. Any type of unwelcome or unwanted sexual advances, requests for favors, or other conduct that is used as a condition of employment may be considered unlawful sexual harassment. If a supervisor uses sexual favors as a basis of employment decision-making, whether between same-sex or opposite-sex individuals, this too may be considered sexual harassment in the workplace. It is imperative that an employer has a thorough workplace policy in place which communicates the company’s zero-tolerance of any type of harassing behavior, as well as what employees may do if they become victims of harassment. Employers who are proactive in training employees and supervisors, and regularly enforce the organization’s stance against harassing and intimidating behavior in the workplace generally have reduced exposure to harassment-related liability.
Harassment may occur between colleagues, a supervisor and a subordinate, or between a client, vendor or associate of an organization and its employee. Providing adequate training to employees and management staff will ensure that the organization is consistent in its handling of harassment complaints, applies disciplinary action when warranted, and is prepared effectively for the prevention of sexual harassment in the workplace. Employers who communicate to their staff the importance of maintaining a harassment-free environment will promote a productive workplace environment as well as help keep the employer out of court.
Though there are currently only three states that mandate supervisory employees to be trained on Sexual Harassment (California, Connecticut and Maine), it is suggested that all employers incorporate a training program for their employees to become familiar with the organization’s policy on anti-harassment, as well as what types of behavior constitute harassment.
Investing the time in the workforce and implementing a workplace anti-harassment policy will help employees learn how they can help prevent harassment from occurring in the workplace. Supervisors who partner with the Human Resources Departments on the enforcement of Anti-Harassment policies as well as effectively communicate intolerance for unlawful sexual harassment in the workplace are more likely to prevent sexual harassment from taking place. Upon receiving a complaint of harassing behavior, it is also critically important to effectively and consistently conduct a harassment investigation in order to resolve the complaint.
Tool of the Month:
Health Care Reform Acts Summary Sheet: We know Health Care Reform can be very confusing with lots of new terms and deadlines. We’ve created a handy document for your reference. You will find explanations and deadlines for:
- Individual Mandate
- Employer Mandate
- Notice of Exchanges and Subsidies
- Reporting Requirements
- FAQs
- and more
To download the Health Care Reforms Acts Summary Sheet, visit the HR Support Center, “Benefits” tab on the “Health Care Reform” page.
E-Verify
U.S. law requires companies to employ only individuals who may legally work in the United States – either U.S. citizens, or foreign citizens who have the necessary authorization to be employed in the United States.E-Verify is an Internet-based system that allows businesses to efficiently determine the eligibility of applicants or employees to work in the United States.On June 15th, be sure to visit the HR Support Center, and listen to this month’s HRCast to learn more about this topic.
HR Tip of the Month
Workplace Summer Hours:
Balancing Workplace Productivity and Beach Outings before 6:00 pm
A summer hours schedule can be a way for employees to enjoy the balmy weather of the summer months, while maintaining productivity. Many organizations are offering flexible work arrangements, such as summer hours, which may enhance work-life balance and employee retention rates. Summer hours are different from a flexible work program in that all employees enjoy the benefit; however, the criteria in implementing summer hours are similar to that of a flexible work program.The following considerations should be taken into account when developing a program:
- Timing. Determine the start and end dates of your program.
- Schedule. There are a number of different options that can be implemented, including:
- One day off per week
- Early closing on Friday
- Change in core hours/scheduled shifts
- Compressed work week
- Organizational goals. Your summer hours program must align with the company’s objectives and goals in order to be successful.
- Exceptions. There may be times when all employees, or just a few, will need to forego their summer hours in order to accommodate business needs.
- Think outside the box. There may be a non-traditional work hours program that will enhance your business and provide employees some temporary flexibility in their summer schedules.
- Evaluation. Let employees know, upon implementation, that the program will be evaluated and may be changed at any time due to business demands.
The benefits of a flexible work schedule program can be great, but the program should be carefully planned out prior to its implementation.
Did you know?
75%
Approximately 75% of all employers currently conduct online searches on job applicants and potential candidates independent of the formal reference checks performed on candidates who have been selected as finalists for a position.
Quote of the Month
“Motivation is the art of getting people to do what you want them to do, because they want to do it.” – Dwight D. Eisenhower
A Look Ahead
June:
Dairy Month
Safety Awareness Month
Children’s Awareness Month
Effective Communications Month
June 1: International Children’s DayJune 2: National Cancer Survivors DayJune 5: World Environment Day
June 6: D-Day (World War II D-Day invasion of Normandy, France, 1944)
June 7: National Donut Day
June 8: World Ocean Day
June 14: Flag Day (United States)
June 14: World Blood Donor Day
June 16: Father’s Day
June 21: First Day of Summer
June 21: World Music Day
June 23: International Olympic Day
June 26: International Anti-Drugs Day
June 27: National HIV Testing Day
Contact Us
Paragon Business Services, Inc.
7610 N Stemmons Frwy
Suite 600
Dallas,TX 75247
Additional Contacts
Phone: 866-444-4615
Fax: 214-951-1920
Legal Disclaimer: This message does not and is not intended to contain legal advice, and its contents do not constitute the practice of law or provision of legal counsel. The sender cannot be held legally accountable for actions related to its receipt
Paragon Business Services, Inc 