Look past the laws (pudding) and understand the regs (Oreo)

Buckle Your Seat Belts-
Administrative Abound Changes

Administrative agencies at both the federal and state level have announced a number of important changes for human resources administration and benefit plans, and the year is only half over.  Selected important changes are listed below.

FEDERAL

Department of Labor (“DOL”)

• DOL has issued a Notice of Proposed Rule Making with regard to changes in the FLSA, including but not limited to, an increase in the salary threshold for the so-called white-collar exempt employees (administrative executive and professional) from $23,660 annually ($455 weekly) to $35,308 annually ($679 weekly immediately with more increases thereafter), and from $100,000 to $147,414 annually for those in the highly compensated salaried exempt category.
• DOL issued an opinion letter making it clear that it considers service providers obtained through a virtual marketplace referral service to be independent contractors, rather than employees, for FLSA purposes.  Such an opinion recognizes changes to our increasingly Common gig economy.  Click Here
• DOL issued an opinion letter for FMLA purposes stating that an employer may not delay the designation of FMLA-qualifying leave or designate more than 12 weeks of leave (or 26 weeks of military caregiver leave) as FMLA leave.  Click Here

Department of HHS Health and Human Services (“HHS”)

• HHS has issued new guidelines regarding faith-based objections contrary to a health care worker’s morale or religious beliefs to performing certain medical procedures, such as abortions and sterilization procedures.  These are issued as Conscience Protections for Health Care Providers.  Click Here
• HHS has proposed a rule which will remove sexual orientation and gender identity protections from HHS health care discrimination regulations. 

DOL, HHS, Treasury

• In June, a new regulation was issued which will allow Health Reimbursement Accounts (“HRA”) accounts to be used by employees who do not have access to an employer-sponsored group health plan to purchase individual health coverage through an HRA on a tax-free basis.  Completion of appropriate forms is required.  Click Here

Equal Employment Opportunity Commission (“EEOC”)

• A federal court has extended the compliance deadline for the EEO-1 form (filed by employers with 100 or more employees) for Component 2 (compensation data) for 2018 to September 30, 2019. Form must be obtained from the EEOC.  Component 1 (Demographic data on employee job category, race, ethnicity and sex) should have been filed by May 31, 2019.

Internal Revenue Service (“IRS”)

• Proposed new Health Savings Account (“HSA”) thresholds for 2020.  These are $3,550 for an individual and $7,100 for family coverage.  Revenue Procedure 2019-25.
• Issued an amendment to the Employee Plans Compliance Resolution System (“EPCRS”) allowing an opportunity to self-correct issues for organizations sponsoring retirement plans.  Revenue Procedure 2019-19.  Click Here
• Redesigned the W-4 Form Employee’s Withholding Allowance Certificate for 2020.  Click Here

STATE

Pennsylvania Department of Labor and Industry (“DLI”)

• New regulations regarding “white collar” employees, exempt from overtime under the Pennsylvania Minimum Wage Act are under consideration by this Department.  Salary thresholds will increase to $610 weekly upon the adoption of the final rule making; $766 weekly one year later; $921 weekly two years later and continue to increase in the third year and every third year thereafter.  Limits are included on the amount of incentive pay which can be credited to this salary amount.  Note these amounts do not correspond with those announced by US DOL.
• For workers’ compensation injuries occurring on or after January 1, 2019, the maximum weekly benefit rate will be $1,049.  The minimum rate for those same injuries is $582.77.
• For unemployment compensation purposes for claims filed on or after January 1, 2019, the maximum benefit amount is $573 plus the possibility of dependent’s benefits.

Bottom Line:  Employers should remain attentive to the changes not only in a variety of employment laws, but also in regulations and administrative agency interpretations.  Some of these regulations may even be helpful from a Human Resources standpoint.

This blog was written by Kathy Speaker MacNett at SkarlatosZonarich, who authors our Model Policies and Forms for Pennsylvania Employers. You can find additional articles at Insights on their website.