As a result of social distancing in the midst of COVID-19, employees are working remotely now more than ever. One of the many unique challenges facing employers as a result of the increased number of employees working from the confines of their homes is the ever-present risk that an employee could be injured while conducting work-related tasks. Employers and their insurers must be aware that, under certain circumstances, injuries suffered by employees in their domiciliary “workplaces” could be compensable under workers’ compensation laws—even if any personal, non-work related components of the employee’s work-from-home arrangement contribute to the injury. Continue reading
Category Archives: Employee Benefits
Payments and Perks: the DOL Announces a Proposal to Clarify What Qualifies as Overtime
On Thursday, March 28, 2019, the U.S. Department of Labor (“DOL”) announced proposed changes to the overtime provisions of section 7(e) of the Fair Labor Standards Act. In its current form, the statute generally requires employers to pay overtime if workers work more than 40 hours a week. One exemption to the overtime rule includes the salary basis exemption, where employees generally must be paid at least $455 per week on a salary basis, unless they are outside sales employees, teachers and employees practicing law or medicine.
Overtime pay is equal to one and one half times the regular rate of pay. In designating what is included under the regular rate of pay, the current provision makes a distinction between payments and perks. With the proposed provision, the DOL seeks to clarify what qualifies as either a payment or perk in an attempt to discourage employers from offering incentives that are excluded from the calculation of overtime pay.
The proposed changes confirm that the following types of employer-provided benefits may be excluded from the regular rate of pay:
- the cost of providing wellness programs, onsite specialist treatment, gym access and fitness classes and employee discounts on retail goods and services;
- payments for unused paid leave, including paid sick leave;
- reimbursed expenses, even if not incurred “solely” for the employer’s benefit;
- reimbursed travel expenses that do not exceed the maximum travel reimbursement permitted under the Federal Travel Regulation System regulations and that satisfy other regulatory requirements;
- discretionary bonuses;
- benefit plans, including accident, unemployment and legal services; and
- tuition programs, such as reimbursement programs or repayment of educational debt.
This proposal is published for public comments and will remain open until May 28, 2019. Comments may be submitted to the Notice of Proposed Rulemaking at www.regulations.gov. More information is available here.
Employers Beware! You Can Now Be Sued for What you Say in Unemployment Proceedings
By Mitzi Wyrick
Based on a recent court ruling, what you say in unemployment proceedings can now lead to a lawsuit. In Hickey v. General Electric Company, 2017-SC-000135-CL, the Kentucky Supreme Court held in a unanimous opinion that employers may be sued for making false statements during unemployment proceedings. This ruling means that employers may have to face a claim for punitive damages if they are found to have made a false statement during an unemployment proceeding.
The dispute arose over whether Logan Hickey voluntarily quit his employment or was fired. Hickey was hired to work the first shift on the production line at General Electric Company (“GE”) in May 2015. At the time he applied, Hickey stated that he was capable of and available for work on any shift. In August 2015, Hickey was reassigned to a second-shift position. After working several days, Hickey claimed Continue reading
Risk for Nonqualified Deferred Compensation Falls on Employees
The long-running Lehman Brothers bankruptcy case brings to light the risk employees have when participating in an employer sponsored nonqualified deferred compensation plan. In this case (from the U.S. Bankruptcy Court in Manhattan), more than 300 executives and certain employees participated in a nonqualified deferred compensation plan (the “Plan”). The Plan provided that payments under the Plan are “unsecured subordinate obligations” of Lehman Brothers (the “Company”) and contained a provision that the Plan benefit payments would be subordinated to Continue reading
Qualified Small Employer Health Reimbursement Arrangements
Small employers now have the ability to assist employees with the cost of health care through a qualified small employer health reimbursement arrangement (QSEHRA). Prior to the Affordable Care Act (ACA), small employers were able to offer stand-alone health reimbursement arrangements (HRAs) to help employees pay for medical care expenses, including health insurance premiums, on a tax-free basis. This changed with the passage of the ACA, under which stand-alone HRAs were generally considered group health plans that violated the ACA’s annual dollar limit prohibition (some stand-alone HRAs, such as retiree-only HRAs, remained valid). Consequently, employers who continued to offer such arrangements could face fines of up to $36,500 per employee per year (with a $500,000 total limit). With the passage of the 21st Century Cures Act, which incorporates key components of the Small Business Healthcare Relief Act, small employers may again offer this benefit to employees.
Eligible Employers To be eligible to offer a QSEHRA, an employer (1) cannot be an “applicable large employer” under the ACA, i.e., had fewer than 50 full-time employees, including full-time equivalent employees, on average during the prior year, and (2) cannot offer a group health plan to any of its employees. Qualified employers must offer the Continue reading
Last Call! PPA Plan Restatement Deadline Drawing Near
The deadline for employers that use pre-approved retirement plan documents to sign an updated version of their 401(k), profit-sharing, money purchase, or other defined contribution plan, is drawing near.
The IRS requires all pre-approved plans to be updated or “restated” in their entirety every six years to incorporate legislation that was enacted since the last update and to receive the IRS’s approval for another six years. The latest six-year cycle, generally known as the “PPA restatement cycle,” ends on April 30, 2016 and takes into account such legislation (and related IRS guidance) as the Pension Protection Act (PPA), the final Section 415 regulations, the Heroes Earnings Assistance and Relief Tax Act (HEART), and the Worker, Retiree, and Employer Recovery Act (WRERA). The cost of restating the plan can Continue reading
Occupational Safety & Health Administration Seeking Comments on Whistleblower & Anti-Retaliation Guidelines
On November 6, 2015, the Occupational Safety and Health Administration (“OSHA”) issued a news release that it will be accepting comments from the public on a draft document entitled, Best Practices for Protecting Whistleblowers and Preventing and Addressing Retaliation. Comments will be accepted by OSHA until January 19, 2016.
The guidelines in this draft document are well worth reading for all employers. They are generalized enough that they provide a good internal prevention program for avoiding litigation, and even if litigation is brought based on an employer’s alleged retaliation, their implementation could supply employers a good litigation defense to defeat an employee’s claim (assuming, of course, the employer has adopted these “best practices”).
The Department of Labor (“DOL”), of which OSHA is a branch, is increasingly becoming the governmental agency before whom employers are brought for retaliation claims arising out of any number of areas of law governing the employment relationship. Not just complaints regarding workplace health Continue reading