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EEOC Wellness Regulations Survive AARP Challenge

A federal court in Washington, D.C. has declined to issue an order that would have halted implementation of the EEOC’s wellness plan regulations under the ADA and GINA. The regulations had been challenged by AARP on the grounds that they failed to adequately protect workers’ rights. However, the court concluded there was no risk of "irreparable harm" to workers in allowing the regulations to remain on the books. This means the regulations remain in force and will apply as scheduled. 

The EEOC’s regulations are generally applicable to wellness programs beginning with the 2017 plan year. The regulations limit the incentives that employers may offer in connection with a wellness program that involves a medical examination or disability-related inquiry. Most wellness programs that involve a health risk assessment or biometric screening are covered. The incentive cannot exceed 30% of the cost of employee-only coverage under the related health plan -- or twice that amount in the case of plans that offer incentives to both employees and their spouses.The regulations also impose notice and confidentiality requirements, in addition to limiting the amount of incentives.

The EEOC’s rules apply in addition to other wellness plan rules under HIPAA and the ACA, with sometimes inconsistent results. For example:

  • Under the HIPAA and ACA regulations, there is no limit on the amount of the incentive that can be offered in a “participation only” wellness program involving completion of a health risk assessment and biometric screening, but the same wellness program generally is subject to      Continue Reading...
OSHA Changes Statute of Limitations on Recordkeeping Citations

OSHA issued a new rule last week related to the statute of limitations for recordkeeping violations.  For those of you scratching your head and wondering what is a "statute of limitations", it is simply a time limit.  Prior to the issuance of the new rule, OSHA could only cite an employer for a recordkeeping failure in the six month period following the error.  The new rule moves that time limit out to five years.  This basically means that errors in your recordkeeping practices can now result in a citation for up to five years after the error. 

As an example, Frosty the Elf sustains an injury on 12/24/2016 loading Santa's sleigh.  North Pole Industries does not have a full-time HR person and Mrs. Claus fails to record the injury in the logs.  Under the old rules, if OSHA did not discover the error prior to June 24, 2017, North Pole Industries was in the clear.  Under the new rule, Mrs. Claus' mistake can now be the basis of a citation until December 23, 2021. 

The new rule takes effect on January 18, 2017.  While the rule has been issued, it is possible the incoming Trump Administration will change directions or Congress may take action to block the rule.  Stay tuned as we move into 2017. 

Wage Garnishment Orders in Kansas: Follow the Rules to Avoid Liability

For employers, receiving garnishment orders is an all-too-common experience. If one of your employees falls behind on child support payments or has a judgment entered against her, you could receive a garnishment order directing you to make payments toward that obligation out of the employee's wages. As commonplace as receiving a garnishment order may be, the penalties for being inattentive to such orders are extraordinary. As an employer, you need to be aware of, and prepared to satisfy, your obligations under Kansas wage garnishment law. 

Background on wage garnishment in Kansas
In 2002, the state legislature amended the garnishment statutes, making the rules substantially consistent in Chapter 60 cases (the typical civil case) and Chapter 61 cases ("limited action" civil cases). Now, the substantive requirements for employers who have received garnishment orders are essentially the same under both chapters. 
Below are some basic guidelines that should help you navigate Kansas wage garnishment rules and the way they have been applied since their 2002 update. This article does not cover all of the rules' nuances. Employers who fail to follow the rules face harsh penalties in Kansas, so you are advised to seek the advice of counsel in handling garnishments.
What is wage garnishment?
When you receive a garnishment order, it means that one of your employees owes a judgment creditor money and the creditor wants to collect the debt by forcing you to withhold money from the employee's paycheck. 
On a garnishment order, you will be listed as the "garnishee." The party seeking the garnishment is the      Continue Reading...
Severance Policy Not Applicable to Employees Who Suffered No Job Loss
Some employers have written policies that provide severance pay when employees lose their jobs through actions like job eliminations or reductions in force. So what happens when employees lose their job with the original employer, pursuant to a consolidation or plant sale, but that employer makes arrangements for them to transfer to comparable jobs with the new employer with no lost work time? The Kansas Court of Appeals recently ruled that City of Topeka employees whose employment was transferred to Shawnee County did not experience a “lay-off due to work or job elimination,” and thus were not eligible for severance pay under the City’s severance pay policy.
The terms of employment for workers in Topeka’s parks and recreation department were governed by the city’s personnel code. One provision of the personnel code addressed severance pay, setting forth who is eligible for it, under what circumstances, and how much.
In 2011, the city decided to consolidate its parks and rec department with Shawnee County’s department. The city and county entered into several “consolidation contracts” that set forth the terms of the consolidation. Moreover, the city’s employees didn’t need to worry about their jobs because the city was able to negotiate an assurance with the county that all city employees who wanted to could transfer to county positions at comparable pay.
The city was able to negotiate other provisions for its employees, including:
  1. They would be able to receive severance pay if the county fired them within the first three years after      Continue Reading...
Ho Ho Oh No! HR Pitfalls at the Annual Holiday Party

As the outdoor air cools and becomes crisp, office-wide relief becomes palpable as businesses finally stop blasting the office’s AC-on-steroids system.  Ugly holiday sweaters that violate all fashion sensibilities, if not office dress codes, start to appear on the regular.  And all are delighted by that one co-worker in the open cubicle area who plays the 24-hour holiday music radio station.  It’s that time of year again!  Time for holiday cheer and avoiding the pitfalls that can come from the annual holiday office party.

The Naughty List
Santa’s list wouldn’t be complete if it didn’t have a few coal recipients.  The following are true stories of office parties that went horribly awry.
  • A California bank branch held an annual holiday party at a local restaurant.  There were only about 15 people in attendance, but they included a female bank teller, the teller’s female boss, and the boss’ boyfriend (a manager at a different bank branch).  The entire affair, including the alcohol, was funded by the bank’s budget.  The office party officially ended, but the party-goers continued their revelries.  But once the bank’s party ended, the bank employees had to fund their own cocktails.  The party continued into the restaurant bar area, then moved to another bar as the night progressed, and finally ended up at the boss’s house.  You can probably see where this is going.  The teller ultimately accused her boss and the boss’s boyfriend of sexual harassment, and brought suit against the bank, alleging that the bank      Continue Reading...
Christmas Vacation, Free Beer, and the FLSA

In the holiday classic Christmas Vacation, family patriarch Clark Griswold is distressed that he has not yet received his bonus, which he is counting on to cover a check he wrote for a new swimming pool. Finally, on Christmas Eve, a courier arrives with a delivery. As his family looks on, Clark opens the envelope to find, not the bonus he is expecting, but a one-year membership in the Jelly of the Month Club. 

Naturally, Clark has an epic meltdown. Well-meaning but misguided Cousin Eddie then kidnaps Clark’s boss and drags him back to the house, so Clark can confront him about cancelling the employees’ bonuses.
“I was expecting a check. Instead I got enrolled in a jelly club. Seventeen years with the company. I’ve gotten a Christmas bonus every year but this one. You don’t want to give bonuses, fine. But when people count on them as part of their salary—well, what you did was just plain …”
“Sucks,” Clark’s son Rusty interrupts.
After looking around the room at the family’s long faces, Clark’s boss has a change of heart and announces that he is reinstating the bonuses. And it’s Merry Christmas to all, and to all a good night—until a SWAT team breaks into the Griswold home to rescue the kidnapped boss, and Uncle Lewis inadvertently triggers a sewer gas explosion.
Promises, Promises
While cancelling a bonus is a great set up for a comedy movie, year-end bonuses can give rise to legal snags that are no laughing matter for employers. Under state wage payment      Continue Reading...
Federal Court Puts DOL Salary Changes on Ice

Late yesterday afternoon, a federal judge in Texas issued an order preliminarily enjoining the DOL's proposed amendments to the white-collar exemptions under the FLSA.  The most notable aspect of these proposed changes was the substantial increase in the minimum salary necessary for exempt status, from the current $23,660 to $47,476 per year. 

This decision arose from two recently filed cases brought against the Department of Labor by a group of state Attorneys General and a coalition of business advocacy groups.  Although the court did not issue a final decision on the merits of the issues, it determined that it was substantially likely that the plaintiffs would prevail on their argument that the DOL lacked the authority to impose a salary requirement that could be determinative of exempt status, regardless of an employee's job duties or responsibilities.

The injunction does not end the litigation in those cases, but it effectively places the regulatory amendments on indefinite hold until those cases conclude through final decisions.  While it's possible that the court could ultimately decide to lift the injunction, or the district court's decision could be reversed on appeal, neither of those decision points is likely to occur in the near term, or before the Trump Administration takes over the DOL.  How and to what extent the Trump DOL decides to continue to fight for these amendments remains to be seen. 

For now, employers should continue to follow the current requirements for exempt status, which are paying a salary of at least $455 per week per the current salary      Continue Reading...

Looking Ahead to 2017

With the outcome of the election in the books, we can begin to look forward to 2017 and beyond.  In most election years, the outcome provides us with a decent idea of what is to come.  This year's election cycle is a bit different than most.  It is a bit difficult to predict how Donald Trump and his presidency will impact the current landscape of employment law.  Here are a few things that might get some attention in the first half of 2017:

  • The topics surrounding health care and the ACA are likely to get plenty of discussion.  Whether there will be significant change is another question.  It isn't easy to make tight or fast turns in large vehicles.  The amount of change to the health care system as a whole generated by the ACA in the last several years is considerable.  It may prove to be slow going if there is an attempt to repeal or significantly modify the ACA.
  • The immigration area is likely to get some attention in 2017.  The scope and nature of that attention is hard to predict.  This is a rather complex set of issues that has been boiled down to simple campaign rhetoric in 2016.  As with health care reform, this area may prove to be complex as well.  Employers should expect some shifts in enforcement priorities in the coming year as the new administration takes over in Washington.  Keep in mind programs like deferred action (DACA) are      Continue Reading...
On Campus Recruiting and Age Discrimination

In a recent decision, the 11th Circuit Court of Appeals ruled that on campus hiring programs used by employers cannot serve as the basis for an age discrimination claim.  The issue resolved by the Court revolved around whether older applicants can make the claim that on campus hiring creates a disparate impact against older applicants.  The disparate impact theory approach was rejected by the Court requiring older applicants to bring claims only for intentional bias.  In plain language, the idea that on campus hiring disadvantages older applicants was rejected by the Court as the grounds for a hiring discrimination claim.   

Employers should keep in mind that this ruling directly applies to only a couple of states in the southeast.  The issue is still unresolved for most of the country, although this ruling would be persuasive in other areas.  This is an issue to keep an eye on as other jurisdictions grapple with these types of age discrimination claims from older applicants. 

Potential Legal Challenge to the New DOL Overtime Regulations

Just a heads up to those of you working hard to plan for the change in the overtime regulations set to take effect on December 1.  It appears that the U.S. Chamber of Commerce plans to file a lawsuit seeking to enjoin the new rule and ultimately seeking to invalidate the regulation.  While nothing has been officially announced, the McKinney Texas Chamber of Commerce issued an announcement that it was joining a coalition supporting the lawsuit which seems to indicate something is about to happen on this front.  Stay tuned to this issue as those upcoming changes you are planning to make may not be necessary if the litigation succeeds. 

EEOC's Position on Sexual Orientation Based Discrimination Rejected by the 7th Circuit

As most of you probably already know, the EEOC has taken the position that bias based on sexual orientation is sex discrimination in violation of Title VII.  In a decision issued by the 7th Circuit Court of Appeals (the first federal circuit court of appeals to hear such a case), the EEOC's position was rejected.  The Court focused heavily on following the precedent established in prior 7th Circuit cases in reaching its conclusion. that Title VII does prohibit bias on the basis of sexual orientation.

This issue is likely to make news through the remainder of 2016 and throughout 2017 as other federal circuit courts of appeals are set to hear cases raising the same issue.  In addition to further court decisions, the Equality Act is pending in Congress which would add sexual orientation and gender identity to the protected classifications currently in existence under federal law.  Stay tuned for further developments.  

Communications Workers of America Open Field Office in Wichita

The Communications Workers of America (CWA) plans to open a field office in Wichita to facilitate organizing efforts at T-Mobile.  The local office will be in downtown Wichita.  While the focus of the organizing effort appears to be T-Mobile, a CWA target nation-wide since 2008, it is possible the CWA will use the office for other organizing activities in the area. 

Department of Justice Adjusts Penalties for Inflation

The Department of Justice ("DOJ") published a new set of civil penalty amounts for a variety of civil matters enforced by the DOJ that are set to go into effect for violations occurring after August 1, 2016.  The new penalty amounts were adjusted for inflation from the prior penalty amounts which in some cases had not been adjusted by the DOJ for quite some time.  As a result, the adjustments to the penalty amounts in some areas were significant. 

As part of the inflation adjustment, the DOJ increased the penalty amounts for the various immigration related violations enforced by the DOJ.  These penalty amounts, initially established between 1980 and 1996, had never before been adjusted.  Of note, the DOJ adjusted the penalty amounts for I-9 paperwork violations from a range of $110 to $1,100 per violation up to a range of $216 to $2,156 per violation.  In addition, the penalty amounts for employing aliens not authorized to work in the United States were also increased significantly.

Employers should make note of these increases related to the I-9 process.  If you haven't audited your I-9 records in some time, now would be a great time to do so in advance of these increased penalty amounts. 

A New Frontier -- Breastfeeding

Earlier this month, four breastfeeding airline pilots filed EEOC complaints against Frontier Airlines for refusing to accommodate their need to express breast milk by way of pumping.  The charges allege Frontier did not provide any accommodation to allow the employees to pump regularly and disciplined one employee for engaging in pumping activity aboard an airplane.  

The EEOC's position on the subject is clear and spelled out in its Enforcement Guidance on Pregnancy Discrimination and Related Issues dated June 25, 2015: "An employee must have the same freedom to address such lactation-related needs that she and her co-workers would have to address other similarly limiting medical conditions."  

These filings serve as a good reminder to employers that the EEOC reads the Pregnancy Discrimination Act to include reasonable accommodation obligations similar to those in the ADA. Various state laws, including one in Kansas, also provide certain protections for breastfeeding and/or expressing breast milk. Employers should carefully consider any request made by an employee to allow for this type of activity.  In addition, not only do employers need to consider Title VII, the Affordable Care Act amended the FLSA to require employers to provide break time and private locations for pumping activity.  

It will be interesting to see how Frontier Airlines responds to these charges.  Stay tuned.   



EEOC Issues Final Wellness Regulations

The EEOC has issued final regulations under the ADA and GINA that address the extent to which employers may use incentives to encourage employees and their spouses to participate in wellness programs that involve disability-related inquiries or medical examinations. Although the regulations allow limited incentives, there are a number of conditions and restrictions. And there are some important differences between the EEOC's rules and other rules governing wellness programs, such as guidance under HIPAA and the ACA. Here are the highlights.

What Wellness Plans Are Covered?

These regulations apply to any wellness plan that involves a disability-related inquiry or medical examination. This will include most wellness plans that require completion of a health risk assessment or biometric screening. It also includes tobacco-related wellness plans that involve any type of medical test to screen for the presence of nicotine, but it does not include tobacco-related programs that merely ask an employee to certify whether they use tobacco (and do not require any other medical examinations).

In an important change from the proposed regulations, the final regulations apply to a wellness program without regard to whether the program is offered in connection with a group health plan. For example, an employer that offers a cash reward to employees for completing a health risk assessment or biometric screening may be subject to the limitations under the final regulations.

What Limits Apply to Wellness Incentives?

For a wellness plan covered by these regulations, the incentive offered to any employee may not exceed 30% of the full cost      Continue Reading...


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Don Berner, the Labor Law, OSHA, & Immigration Law Guy
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