Payroll Services and HR Alerts

Robbie MossHR Topics, Payroll Services

Notice of Exchanges and Subsidies – 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. Additionally, beginning on October 1, 2013, this notice must be provided to each new employee within 14 days of the employee’s commencement of employment.

There are two model notices available: one for employers who offer a company-sponsored health plan to some or all employees, and, one for employers who do not offer a health insurance plan. Both of these model notices are available for download in the HR Support Center “Essentials” tab located under the “HR Forms” section. We have also uploaded an FAQ document regarding this requirement in our Health Care Reform Section under the “Benefits” tab (the Notices are also available there).

The purpose of these Notice of Exchanges and Subsidies is to inform employees of the existence of Health Insurance Exchanges (also called Health Insurance Marketplaces) and 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 these Marketplaces begins October 1, 2013 and coverage is available beginning on January 1, 2014.

Medical Loss Ratio Rebate Checks – The Affordable Care Act requires health insurers to spend a specific percentage of collected premiums on health claim reimbursements and other activities to improve health care quality of members. If your insurance carrier spent more than permitted by statute on administrative costs, as opposed to reimbursement for medical services and activities to improve health care quality, your insurance carrier will be required to provide your group with a Medical Loss Ratio Rebate Check. Such checks must be mailed by August 1st of each year for the previous calendar year. Should your organization receive a Medical Loss Ratio Rebate Check, please refer to our Medical Loss Ratio Rebate Checks: FAQs in the HR Support Center for instructions regarding your responsibilities for distribution as the plan sponsor. Simply click on “Benefits” then “Health Care Reform.” The FAQ document is listed under the “Forms, Templates and Guidelines” heading. Should you have additional questions, please contact your Human Resources Professional.

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Social Media, the means by which individuals may post personal messages, photos and videos to the web, has exploded as a means of electronic communication. Whereas this efficient, ever-present medium has magnified the concept of in the moment connectivity and communication, its impact on workplace policies as well as how organizations conduct business correspondence and advertising has becoming encompassing. The challenges that businesses experience with social media usage involve maintaining policies on what employees share in this very-public, very-difficult-to-delete-medium and yet adhere to the laws under the National Labor Relations Act (NLRA) as it relates to employee rights and communication on social media websites.

In 2012, approximately 94% of all businesses with a marketing department used social media, such as Facebook, Twitter and Google+, to increase brand awareness and to communicate with over one billion users on these sites. Technology is rapidly changing the way we conduct business, and social media has become the dominant form of communication both for business and personal use.

The business benefits of social media are numerous. Social media, when utilized as a customer service tool allows consumers to conduct efficient research about organizations and their products and services. Additionally, companies that incorporate inexpensive social media marketing campaigns benefit through the increase in their organization’s brand awareness.

The biggest challenges and balance in dealing with social media in the workplace is differentiating between effective communications and marketing methods versus vigilant retention of an organization’s security. Complicating these matters further, the law governing social media in the workplace remains unsettled.

Few courts have addressed the legality of monitoring an employee’s social media use on a company- owned communication device, such as a laptop computer, tablet or “smart phone”. Courts have been applying decades-old electronic communication laws, including the Stored Communications Act of 1986, for guidance on social media case litigation. Courts have been struggling with, and debating whether online posted messages, photographs and videos on social media sites are discoverable in court and whether this content is considered to be private and protected from disclosure.

Monitoring employees’ use of social media can be challenging and frustrating. As these websites are often hosted on outside servers not controlled by an organization, the ability and rights of the company to monitor the online social media activities is somewhat stifled. In order to minimize the legal risks associated with the use of social media in the workplace and to ensure that company-owned property is being used appropriately, employers should develop an effective and legal social media policy for their employee handbooks that encompasses clear rules as well as communicates that the organization has no intent of violating Section 7 of the NLRA in its company policy on social media.
Although there are several concerns to balance, key points to consider when drafting a social media policy include:
• Understand your employees’ rights to use social media under the National Labor Relations Act (NLRA).The National Labor Relations Board (NLRB) says that employees have the right to discuss work conditions on social media sites without retribution from their employers. The NLRB has released a series of guiding points in how employers may proceed in regulating employee social media use. This resource provides a good starting point for the creation and administration of social media policies.
• Focus on restricting employee behavior that is not protected under the NLRA. For example: instruct employees not to disclose trade secrets; forbid postings that contain offensive language; and instruct employees not to post harassing or disparaging comments about other employees that could lead to discrimination claims (such as comments related to sex, race, disability or religion).
• Be prepared for discovery. Employers must anticipate that content on social media sites will be relevant in employment litigation. A social media policy should address discovery issues associated with requesting content from these sites and counsel must be prepared to discuss these issues with opposing counsel.
Though social media is an ever-evolving concept and will continue to expand its influence and presence in workplaces, employers can counter its negative impacts and encourage its advantages through thoughtful, compliant workplace policies. To view a sample policy on social media in the workplace, go to the “Policy Library” under the “Essentials” tab in the HR Support Center.
Questions and Answers payroll servicesPayroll Services Question & Answer
Q: One of our employees is in the Army Reserves. She was called to active duty recently; how should we proceed?

A: Under the Uniformed Services Employment and Reemployment Rights Act (USERRA), when a member of the National Guard is called for active duty, the employer is required to provide the employee with an unpaid leave of absence for up to five (5) years. However, for exempt employees, the company must ensure they are paid for any week in which the employee performs any amount of company work without interruption in pay. (This is a requirement under the Fair Labor Standards Act (FLSA) that applies to military service leave.)
Health Care Reform – Automatic Enrollment
The postponement of the employer mandate or “shared responsibility provision” of Health Care Reform until 2015 was a welcome reprieve for many employers. It has led many organizations to browse through other Health Care Reform provisions and timelines. In doing so, several employers have expressed concern regarding the “automatic enrollment” provision which many expected to be implemented in 2014. However, it is important to note that in 2012, the IRS announced the indefinite delay of the automatic enrollment amendment to the Fair Labor Standard Act (FLSA).

The Patient Protection and Affordable Care Act (PPACA) amended the FLSA to require employers with more than 200 full-time employees to automatically enroll new full-time employees in one of the organization’s health benefit plans. The provision also requires the employer to provide adequate notice to the employee as well as the opportunity for the employee to opt out of the health plan. For the purpose of this provision, a full-time employee is defined as one that averages 30 or more hours per week.

While the effective date of the automatic enrollment amendment was unclear in the original legislation, the US Department of Labor stated that it intended to issue automatic enrollment guidance prior to 2014. As a result, most experts anticipated a 1/1/2014 compliance date. However, in 2012, the IRS issued a release stating that, “its automatic enrollment guidance will not be ready to take effect by 2014.” Though, it is still possible that such guidance could be issued in the near future and the compliance date could be later in 2014 or beyond. Many experts believe that a 1/1/15 compliance effective date is the most likely outcome, as the automatic enrollment provision will thus coincide with the employer mandate provision.

The federal government has stated its intention to provide at least a six-month implementation period for employers following the issuance of formal IRS guidance on specific Health Care Reform provisions. Therefore, it is fairly safe to assume that once guidance is issued regarding automatic enrollment, organizations will have at least six months to implement the provision prior to the compliance date.

Employers are anticipating the automatic enrollment guidance to answer many of their inquiries regarding this provision. Perhaps the most important question entails the default plan into which the employer is required to automatically enroll the employee. Additionally, employers are curious as to how to handle employees who were automatically enrolled, but wish to make changes to their benefits plan. For example, employers await guidance as to whether unhappy automatic enrollees will be allowed to drop coverage altogether, or whether their available option will permit them to switch from the default coverage option to other plan selections. The timing requirement for such changes is another factor for which many employers will need to obtain clarification.

Automatic enrollment is one Health Care Reform provision that employers may place on the backburner for now, as there is clearly not enough information to begin the implementation process. However, once the federal government provides direction with respect to automatic enrollment, employers with 200 or more full- time employees will need to consider implementation timeframes, internal resources and possibly outsourcing options.

Should you have questions regarding the automatic enrollment requirement or other Health Care Reform provisions, we recommend directing them to your Health Insurance Broker, Health Insurance Carrier, Human Resources Professional or Accounting/Tax Professional.

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