2019 – “The Year Of the Woman” in Employment Law

As we enter the 3rd year of the #MeToo movement, all signs point towards another year of heightened legal activities in the area of gender discrimination and gender equality. Sexual harassment claims will continue to garner news headlines, but there are bigger threats for employers. For many employers, 2019 will be less about whether their female employees are being harassed, and more about whether they are being treated fairly and equally.

What’s the difference you ask? The answer is everything else outside of harassment, including pay equity, opportunity equality, and fair treatment for employees who are pregnant and new parents.

There is no greater indication of this heightened focus on equality than the 116th Congress, which has a record number of women serving. Naturally, legislation aimed to combat gender inequality will be at the forefront. In this post, we identify the legislative and legal trends employers should pay attention to in 2019 as we declare it “The Year of the Woman.” Continue Reading

The Latest On Religious Accommodations In The Workplace

Article written for Law360, published on February 6, 2019.

In the past few months, we have seen three different cases of religious accommodation claims, with three very different results.

  • In case one, the U.S. Court of Appeals for the Eighth Circuit affirmed dismissal of a U.S. Equal Employment Opportunity Commission failure-to-hire case, on very narrow grounds.
  • In case two, a Florida jury awarded a hotel kitchen employee $21.5 million, after she was terminated for refusing to work on her Sabbath.
  • In case three, a federal judge in New York approved a $4.9 million settlement of a class action brought by the EEOC against United Parcel Service Inc., which involved claims that the company had not properly handled employee requests for religious accommodation, relaxing dress and uniform rules.

What do these cases tell us?

The obligation to accommodate employees’ religious beliefs and practices remains a critical concept for employers to understand, and a concept which the EEOC and the plaintiffs bar plainly take very seriously.

Employers must be careful in drafting and enforcing policies, and managers and human resources executives must be especially cautious when they say “no” to a request for a religious accommodation, and make sure that their denial is on solid legal footing.

To read the full Law360 article, click here.

New York Employers Look Back on 2018 – and Look Forward to 2019

As we close the books on 2018, New York employers really cannot relax after the bombardment of last year’s employment law changes. Many of these laws will require new levels of compliance in 2019, not to mention the new laws on the horizon.

This post will provide employers with a brief recap of what we saw in 2018, and what we can expect in 2019.

LOOKING BACK ON 2018

As we mentioned in our blog post last January – The New Year Brings New Rules to New York – New York State and City lawmakers were busy in 2018 enacting sweeping employment legislation regarding a variety of topics.

New York State

Paid Family Leave

New York State kicked off 2018 with the implementation of New York’s Paid Family Leave law (“PFL”). We covered the roll-out of this law in November 2017 in our post A New Headache – New York’s Paid Family Leave. The law has now been effect for an entire year, and covered employers should have well-established policies and procedures in place to provide PFL to employees. This includes distributing to employees a written policy regarding PFL, ensuring the employer is covered to provide PFL payments either through an insurance carrier or a self-insured fund, and complying with workplace posting requirements.

Anti-Sexual Harassment Legislation

The #MeToo movement dominated the headlines in 2018, and New York State lawmakers took notice. Throughout the year, the state implemented anti-sexual harassment legislation that touched on everything from employment policies and training, to mandatory arbitration clauses and settlement agreements. We covered these new laws at length in July with our client alert – Fall is Coming! New York’s New Anti-Sexual Harassment Laws Just Around the Corner.

The new State laws are in effect. This means all New York State employers should have already issued a written anti-sexual harassment policy that includes an investigation procedure and complaint form for sexual harassment complaints. Employers should be focused on implementing anti-sexual harassment training that meets all state requirements, which must be completed by October 9, 2019.

Employers should also revise mandatory arbitration agreements to specifically exclude sexual harassment claims. Also, employers cannot require confidentiality in settlement agreements regarding a sexual harassment claim by an employee, unless the employee prefers to have the provision. Continue Reading

Healthcare Employer Off the Hook In A Rubella Vaccine Case

While most of us rarely think about rubella – a largely forgotten disease that should have disappeared with the “MMR” vaccine¹ – it was the focus of a recent Eighth Circuit decision this month. If you are asking yourself how this largely forgotten illness has anything to do with employment, we will tell you: because for Janice Hustvet, it resulted in the termination of her 15-year position with a healthcare employer.

In Janice Hustvet v. Allina Health System, Case No. 17-2963, decided on December 7, 2018, the Eighth Circuit held that the employer had legitimately terminated Ms. Hustvet when she refused the MMR vaccine and failed to complete a respirator evaluation.

Ms. Hustvet was an “Independent Living Skills Specialist” at the Courage Center. In that role, she worked with individual clients, all of whom were treated as having “compromised” or “fragile” immune systems. In 2013, the Courage Center merged with the Allina Health System, a large healthcare system.

Following the merger, in March of 2013, the Courage Center announced to its employees that they would become employees of Allina and would have to undergo pre-employment screening, including a “pre-placement health assessment screen.” That health assessment screen included “tracking for immunity to certain communicable diseases” and a Respirator Medical Evaluation (“RME”). Continue Reading

Health Care Reform – ACA Changes and Other Updates

This Advisory supplements our previous advisories dated January 2018, December 2016, December 2015 (as supplemented in January 2016), October 2014, October 2013, November 2012, November 2011, and October 2010, addressing requirements of the Affordable Care Act (“ACA”). Below is a summary of recent developments impacting health care reform, as well as other recent developments affecting employer-sponsored health plans that will be relevant for employer-sponsored plans in 2019.

Review and Update Plan SPDs
Given the changes that have been made to health care reform over the years (legislative changes, new regulations, courts cases, etc.), clients are well advised to take a fresh look at their summary plan descriptions for certain less obvious changes that might be required. While clients might annually update their summary plan descriptions in ordinary course for co-pays, eligibility and contact information, there are additional technical changes that may or may not be required for certain arrangements.

Individual Mandate Repeal
The Tax Cuts and Jobs Act (the “Act”) eliminates the shared responsibility payment for those individuals who fail to maintain minimum essential health coverage beginning January 1, 2019. The Act did not, however, repeal the employer shared responsibility mandate or reporting requirements. Those requirements are still in play, and the IRS has been actively enforcing these requirements against employers.

ACA Information Reporting Deadlines Extended
The IRS has extended the due dates for furnishing individuals with 2018 ACA information returns on Forms 1095-B and 1095-C from January 31, 2019 to March 4, 2019. The IRS did not, however, extend the deadline for filing ACA information returns with IRS, which remains February 28, 2019 if not filing electronically and April 1, 2019 if filing electronically.

The IRS has extended good-faith transition relief from ACA reporting penalties for employers that can demonstrate they have made good faith efforts to comply with the 2018 information reporting requirements. This relief, however, applies only to furnishing and filing incorrect or incomplete information and not to a failure to timely furnish or file a statement or return. In the latter case, penalties may apply absent reasonable cause.

To read the full advisory on the Kelley Drye website, click here.

IRS Releases Guidance on Employer FMLA Tax Credit

As mentioned in our January 2018 and March 2018 Client Advisories, the Tax Cuts and Jobs Act (the “Act”), provides a temporary corporate federal tax credit, ranging from 12.5 percent to 25 percent, that may be claimed by eligible employers for certain wages paid in 2018 and 2019 to qualifying employees during family and medical leave, pursuant to a written policy and subject to certain maximums and other limitations. The IRS recently released a set of Q&As in Notice 2018-71, that employers will find helpful in evaluating whether or not to claim the tax credit. This advisory summarizes some of the notable guidance provided.

The Notice provides much needed guidance on a number of issues related to how the requirements for the tax credit are satisfied. To be eligible for the tax credit, an employer must have in place a written policy that (i) provides at least two weeks of annual paid family and medical leave to all full-time “qualifying employees” and at least a proportionate (i.e., pro-rata) amount for part-time qualifying employees, (ii) requires a rate of payment that is at least 50 percent of the wages normally paid to such employee, and (iii) if applicable, includes language stating that the employer will in no way interfere with employees’ rights under the leave policy.

  • Written Policy. For 2018 (but not 2019), a written policy may be made retroactively effective to January 1, 2018 (or a later date), provided that it is adopted on or before December 31, 2018 and the employer makes any retroactive leave payments by the last day of the taxable year.
  • Family and Medical Leave. Only leave taken for Family Medical Leave Act (“FMLA”) purposes (such as for births, adoptions and family illnesses) may be eligible for the tax credit and the leave may only be used for these purposes.
  • Rate of Payment. Leave paid by a State or local government or paid leave required by State or local law is not taken into account in determining an employer’s rate of payment eligible for the credit. Conversely, if State or local law does not require the leave to be paid (i.e., leave can be provided as paid or unpaid), then such leave could be taken into account in determining an employer’s rate of payment.
  • Wages. For purposes of determining the wages normally paid to an employee, “wages” refers to amounts normally paid for services performed, excluding overtime (other than regularly-scheduled overtime) and discretionary bonuses. For employees who are paid (in whole or in part) on a basis other than a salaried or hourly rate, until further guidance is issued, an employer must determine wages normally paid to the employee using rules under the Fair Labor Standards Act for determining regular rate of pay.
  • Qualifying and Part-time Employees. The Notice provides guidance on identifying qualifying employees and determining part-time status. For example, for purposes of determining part-time status, the Notice provides that an employer may use any reasonable means to calculate hours of service until further guidance is issued.
  • Providing Different Benefits. Employers may design their policies to provide different benefits to different employee classifications, provided the minimum paid leave requirements are satisfied with respect to each FMLA purpose for which the employer intends to claim the credit. For example, a policy could provide for differences in the rate of pay or duration of paid leave based on the employee’s length of service.

To read the full advisory on the Kelley Drye website, click here.

2018 Qualified Retirement Plan Changes

As we approach the end of 2018, qualified retirement plan sponsors should consider reviewing the various changes brought on by recent legislation, regulations and agency guidance to determine whether any plan amendments or administrative updates are needed. This advisory provides a brief summary of some of the notable changes affecting qualified retirement plans.

Hardship Relief
As mentioned in our February 2018 client advisory, for plan years commencing after December 31, 2018, the Bipartisan Budget Act of 2018 (“Budget Act”) eases hardship withdrawal requirements by:

  • Not requiring a plan loan to be taken before a hardship withdrawal is made.
  • Allowing hardship withdrawals to include qualified matching contributions (“QMACs”), qualified non-elective contributions (“QNECs”), and earnings from all eligible sources.
  • Deleting the six-month suspension on deferrals following a hardship withdrawal.

Pursuant to recent IRS proposed regulations implementing the above legislative changes, plan sponsors may adopt any or all of the above changes for 2019. Plan amendments implementing the changes, however, need not be adopted until the end of the second calendar year that begins after the issuance of the IRS Required Amendment List that includes such changes. Employers seeking to put these hardship relief changes into effect for 2019 should, however, contact their third party administrators now to ensure appropriate administrative changes are in place for a January 1, 2019 effective date.

To read the full advisory on the Kelley Drye website, click here.

Illinois Requires Paid Break Time for Nursing Mothers

In August 2018, Illinois governor Bruce Rauner signed House Bill 1595 (“HB 1595”) amending the Illinois Nursing Mothers in the Workplace Act (the “Act”) to provide paid break time to nursing mothers “as needed” to express milk during work hours. The new requirement took effect immediately, and applies to all Illinois employers with more than five employees.

HB 1595 changes the Act in the following ways:

  • Nursing breaks “may” still run concurrently with other breaks. The prior version of the Act stated that the break time “must, if possible” run concurrently with any break time already provided.
  • Reasonable lactation breaks must be compensated. In light of the Act’s “as needed” language, and absent additional guidance from the State, employers should consider following the most expansive approach, i.e., granting nursing mothers paid break time when requested to express milk.
  • In addition, the amendment specifies that the reasonable, now paid, breaks requirement runs only “for one year after the child’s birth.”
  • Finally, the original Act excused employers from providing additional break time for nursing/expressing employees “if to do so would unduly disrupt the employer’s operation.” HB 1595 changed that affirmative defense language; now, in order to be excused from the additional paid breaks requirement, Illinois employers must establish “undue hardship,” a more demanding standard borrowed from the Americans with Disabilities Act and the Illinois Human Rights Act (“IHRA”). Under the IHRA, “undue hardship” is defined as an “action that is prohibitively expensive or disruptive” when considering its nature and cost, the overall financial resources of the facility, the overall financial resources of the employer, and the type of operation of the employer. The employer bears the burden of proving an undue hardship. Therefore, employers should take a considered approach when rejecting break time for expressing milk based on undue hardship to the employer.

Remember the Affordable Care Act (“ACA”) requires employers to provide “a place, other than a bathroom, that is shielded from view and free from intrusion from coworkers and the public, which may be used by an employee to express breast milk.” See 29 U.S.C. 207(r).

Since the amendment is now in effect, Illinois employers should review their current nursing policy to ensure it complies with the recent amendment. If not, employers should revise it as soon as possible.

New York City Releases Clarification on Anti-Sexual Harassment Training Requirements

New York City employers were given some clarity this week regarding their obligations under the City’s Stop Sexual Harassment Act, as the New York City Commission on Human Rights released new FAQs about the law (found here). These FAQs touch on training and posting requirements that all employers should be aware of.

Training Requirements

The FAQs provide guidance on the types of employees and workers that employers must train. Specifically, the FAQs state that employers must train any employee who works 80 hours or more and works at least 90 days in a calendar year (so the training will cover a large number of part-time and short-term employees). Additionally, employers must also train independent contractors who meet these same working time requirements. However, employers will not have to train independent contractors who have received annual training elsewhere. Regardless, independent contractors will count toward the total number of employees for determining whether the employer has 15 employees, triggering the mandate to provide training.

Beginning in October 2019, New York employers will have to train all covered employees and independent contractors (who do not receive training elsewhere) once every calendar year. The City Commission explained that it is working with the New York State Division of Human Rights to release a training module that will meet the requirements of both the City law and the recently enacted State law. The employer will have to maintain proof of training documents for three years, including employee acknowledgments. Continue Reading

Questions Answered About New Jersey’s Paid Sick Leave Law

Effective October 29, 2018, the New Jersey Sick Leave Law requires employers to allow employees to accrue 1 hour of earned sick leave for every 30 hours work, up to 40 hours each year.  The law permits employers to create policies that provide additional leave time.  Here is a link to the law from the State of New Jersey Department of Labor and Workforce Development website.

Since we originally posted about the Paid Sick Leave Law, we’ve received a number of questions about how the Sick Leave Law will impact various employers.  Here are some FAQs that we’ve received.   Have a question that we didn’t cover?  Let us know. Continue Reading

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