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The Departments of Labor, Health and Human Services and Treasury recently issued joint final regulations expanding the availability of health reimbursement arrangements (“HRAs”) by introducing two new types of HRAs – Individual Coverage HRAs and Excepted Benefit HRAs. The following is a brief overview of the requirements employers must satisfy in order to offer HRA coverage to their employees, and employees’ dependents, under one of these new arrangements.

Background

HRAs constitute group health plans that are subject to various Affordable Care Act (“ACA”) rules. The ACA rules include prohibitions on capping or requiring cost-sharing for certain benefits (the “Market Reforms”).

Under prior guidance, in order to comply with or avoid the Market Reforms, HRAs generally had to be integrated with other qualifying group health plan coverage or limit the scope of reimbursable expenses to benefits excepted from compliance (e.g., limited scope dental or vision coverage). The new regulations make it easier for employers to offer HRA coverage by providing two new options that do not require integration with a group health plan or limiting the scope of reimbursable expenses.

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Last week, the Chicago City Council passed the Chicago Fair Workweek Ordinance (“the Ordinance”), which requires employers to give workers early notice of their schedules or face penalties if they change shifts without sufficient notice.  For employers, this may present an administrative challenge, but employers should be prepared to address this national trend.  New York City, Philadelphia, Seattle, San Francisco, Oregon, and the District of Columbia have already enacted laws to protect worker schedules and limit employer discretion in adjusting employee schedules. Mayor Lightfoot is expected to formally sign the bill and it will subsequently be effective July 1, 2020. The highlights follow:

Who’s Covered?

  • The Ordinance requires employers in any “Covered Industry,” which includes building services, healthcare, hotels, manufacturing, retail, or warehouse services with more than 100 employees globally (250 in the case of non-profits) with at least 50 covered employees, to provide certain protection around the scheduling of an employee’s shifts.
  • For restaurants, the law is applicable for businesses with 30 locations globally and at least 250 employees.
  • The Ordinance applies to all employees, within Covered Industries, who make less than $26 per hour or receive an annual salary of under $50,000.

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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”).…
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Medical marijuana occupies a gray space within the United States. Marijuana is an illegal drug under federal law and is included on the Drug Enforcement Administrations’ Schedule I, along with heroin and LSD. The drugs on this schedule are considered to have “no currently accepted medical use and a high potential for abuse.” In spite of the federal prohibition, thirty states have passed some form of legislation allowing for the medical use of marijuana.

This conflict between state and federal law may cause employers confusion—especially in states with expansive disability protections. For example, the New Jersey Law Against Discrimination (“NJLAD”) which provides extensive protections for individuals with disabilities. The New Jersey Compassionate Use Medical Marijuana Act (“NJCUMMA”) supplements the NJLAD by stipulating that employees using marijuana for a medicinal purpose are considered to have a disability and such use is protected. These protections, of course, do not force employers to allow employees to use marijuana at work but do pose a dilemma when it comes to workplace drug testing. Many companies require employees to pass drug tests for federally prohibited narcotics. However, the NJLAD requires employers to provide reasonable accommodations to disabled individuals. Since the NJCUMMA classifies medical marijuana users as disabled, is a drug test a violation of their accommodations?…
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This year flu season came early and with a vengeance. As we mentioned in our October post, The Rise of Employee Religious Discrimination Claims, mandatory flu vaccines present a common pitfall for employers. As employers seek to avoid flu outbreaks in the workplace, they may unknowingly head toward a flu case in the courtroom. Issues arise when employees present sincerely held religious beliefs, or medical issues, that may preclude their flu vaccine. This is a particular challenge in hospitals.

A recent Third Circuit decision should be heartening to employers who are trying to manage vaccination programs. In Fallon v. Mercy Catholic Medical Center of Southeastern Pennsylvania, No. 16-3573, LINK the Third Circuit affirmed the dismissal of a complaint by an employee who was fired for refusing a vaccine, concluding that an employee did not have a valid religious objection and could be lawfully fired.

The plaintiff, Paul Fallon, had worked at Mercy Catholic since 1994. It was only in 2012 that Mercy Catholic began requiring employee vaccinations. In both 2012 and 2013, Fallon submitted requests for exemption that were approved. Each time Fallon submitted his exemption request, attaching a twenty-two page essay outlining his “sincerely held beliefs” that the vaccine was harmful. However, in 2014, Fallon submitted his same request and received a denial in response, along with an explanation that Mercy Catholic had changed its standards for the exemption. Mercy Catholic requested a letter from a clergyperson supporting his exemption request. Fallon was unable to provide a letter and was ultimately terminated.

Following termination, Fallon filed suit in federal court alleging disparate treatment, religious discrimination and failure to accommodate his religion. After the District Court granted Mercy Catholic’s motion to dismiss, Fallon appealed the decision to the Third Circuit which affirmed the dismissal. In doing so, the Third Circuit undertook an examination of whether Fallon’s beliefs were “religious,” ultimately concluding they were not.…
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Marijuana remains illegal under federal law. However, there are many states, and a few cities, which have legalized medical and recreational marijuana – creating challenges for employers, as these laws “sprout up” (pun intended) across the country.

Also, prior to now, the caselaw was quite clear – an employer could discipline an employee for lawful use of marijuana. See Coats v. Dish Network, LLC, 350 P.3d 849 (Colo. 2015). But the law appears to be changing, as recent cases indicate that courts are beginning to recognize that employees who are lawful users of marijuana are entitled to some protection.

It is a trend that employers need to watch.…
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Earlier this month, the Third Circuit Court of Appeals reversed the lower court’s dismissal of a medical resident’s Title IX suit against Mercy Catholic Medical Center in Philadelphia, which alleged that the plaintiff was kicked out of the hospital’s residency program in retaliation for denying a superior’s sexual advances.  See, Doe v. Mercy Medical Center.

The decision is significant for two reasons: it holds that Title IX is applicable to a private hospital, and also held that the resident was not required to satisfy Title VII’s administrative prerequisites (i.e. file a charge with the EEOC or state agency) before suing the hospital.   Each of these findings opens the door to increased claims against hospitals who sponsor educational programs.

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The American Association of Retired Persons (AARP), the nation’s largest consumer interest group for Americans over 50, is suing the Equal Employment Opportunity Commission (EEOC) over its new wellness program rules, which the AARP alleges violates rules protecting the confidentiality of medical information. The new rules were issued in May but do not take effect until 2017.  The AARP is seeking a preliminary injunction to block the new rules.  The case, filed October 24, in Federal District Court in Washington is AARP v. EEOC.

The AARP contends that wellness programs, which many employers offer to encourage healthier lifestyles and prevent disease, violate anti-discrimination laws that protect workers’ confidential medical information.  According to the AARP, the programs invade workers’ privacy as they often involve medical exams and questioning, and leave them vulnerable to employment discrimination based on disability or genetic information.  The AARP specifically opposes wellness programs because older workers are more likely to have the types of less visible conditions (i.e high blood pressure and heart disease) that can become exposed through participation in wellness programs.   The AARP has typically been supportive of the EEOC’s efforts to provide guidance on wellness programs—but now, the AARP is in the unusual position of finding itself at odds with the EEOC.

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Last year was a ‘big year’ in New York in terms of new employment laws, and 2016 is shaping up to be just as big – as employers come into compliance with the many new laws, and brace for additional changes to come.

Among the most significant new laws are the series of statutes signed by the Governor in October, which all go into effect next week – January 19, 2016 – and which focus on women’s rights and gender equality.  While some of these laws do not break new ground– as they mirror existing federal legislation – they increase penalties, expand the scope of existing laws, and will likely cause the issues of gender equality to be more in the forefront than they were before passage.

Combined with the new minimum wage and an aggressive “employee friendly” agenda by the Governor and the Attorney General, New York employers should stand by and be ready for even greater changes.

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