Personnel e.bulletin – January 2015
2015 Employment Law Changes & Trends
Prepared for the PHCC Educational Foundation by TPO, Inc.
This bulletin highlights the employment law changes that will take effect this year and those that are trending – enough information to help you ascertain what you need to put on your radar for your attention.
Minimum wage is a perennial issue that has taken on a higher profile amid the slowly recovering economy and growing public debate about income inequality. States continue to take action while the federal minimum wage remains at $7.25 – a bill to increase the minimum wage to $10.10 an hour was blocked in the Senate last April. Please see our separate guide to 2015 minimum wage changes for information your state.
Affordable Care Act
Employer Shared Responsibility Provisions
Starting January 1, 2015, employers with 100 or more full-time (or full-time equivalent) employees that do not offer health insurance to their full-time employees (and dependents), or that offer coverage that is not affordable or that does not provide minimum value, may be required to pay an assessment if at least one of their full-time employees receives a premium tax credit to purchase coverage in the new individual Marketplace.
Employers with at least 50 but fewer than 100 full-time or full-time equivalent employees will generally have an additional year, until 2016, before these rules apply. A full-time employee is one who is employed an average of at least 30 hours per week.
If a business meets the threshold level of 100 full-time or full-time equivalent employees (50 employees starting in 2016), or is close to it, it’s important to understand how these rules may apply and how the payment amounts could be calculated. Businesses with fewer than 50 employees are generally not affected by the Employer Shared Responsibility rules – that is nearly 96 percent of all firms in the United States. These smaller employers do not have to pay an assessment if their full-time employees receive premium tax credits in the new Marketplace.
Improving Quality and Costs – Paying Physicians Based on Value Not Volume
Taxpayers May Contribute Up to $18,000 to Their 401(k) Plans in 2015
The Internal Revenue Service announced cost‑of‑living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2015. Many of the pension plan limitations will change for 2015 because the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment. However, other limitations will remain unchanged because the increase in the index did not meet the statutory thresholds that trigger their adjustment – the limit on annual contribution to an IRA, or example. Refer to the IRS website for specifics.
Social Security Administration
High-Earning Employees Will Find More of Their Salary Subject to Social Security Payroll Taxes Starting January 1, 2015
Based on the increase in average wages, the maximum amount of earnings subject to the Social Security tax (the “taxable maximum”) will increase to $118,500 from $117,000 for 2015. Social Security and Medicare payroll withholding are collected together as the Federal Insurance Contributions Act (FICA) tax. By Jan. 1, U.S. employers should:
- Adjust their payroll systems to account for the higher taxable maximum under the Social Security portion of FICA.
- Notify affected employees that more of their paychecks will be subject to FICA.
Family and Medical Leave Act
The US Department of Labor has released new updated FMLA certification and notification forms that won’t expire for three more years. These new forms can be found in the DOL.gov website.
Occupational Safety and Health Association (OSHA)
New Reporting Requirements
On January 1, 2015, one of OSHA’s newest final rules will go into effect. This new rule will require employers to notify OSHA when an employee is killed within eight hours of the incident, and to report any work-related hospitalization, amputation, or loss of an eye within 24 hours. In the past, OSHA only required an employer to report work-related deaths and hospitalizations of three or more employees. Single hospitalizations, amputations or loss of an eye did not need to be reported.
Even those who are exempt from maintaining injury and illness records will be required to fulfill OSHA’s new severe injury and illness reporting requirements. In order to simplify the reporting process, OSHA is also developing a web portal where employers may report incidents, in addition to the standard phone reporting.
Employment Non-Discrimination Act (ENDA)
Protection for Federal Contractors and Subcontractors
President Obama signed an executive order in July, to ensure that federal contractors and subcontractors do not discriminate against employees or applicants based on their sexual orientation or gender identity – confirming that the federal contracting system will no longer subsidize exclusion and discrimination.
Many businesses, large and small, already offer workplace protections to lesbian, gay, bisexual and transgender (LGBT) employees, as do 18 states and the District of Columbia.
A Look Ahead
Immigration and E-Verify
Immigration reform remains a hot topic for 2015. Proposed legislation includes making E-Verify mandatory for all employers and the potential release of a new version of the Form I-9 by the U.S. Citizenship and Immigration Services (USCIS).
While a broader application for E-Verify is unlikely to be passed, it’s highly probable that the USCIS will introduce a new Form I-9 this year. If so, employers will need to update their procedures to ensure they’re properly verifying employment eligibility for every new hire.
New OSHA Recordkeeping Rules
OSHA plans to issue a final rule that will require employers to electronically submit certain information from the OSHA 300 Log, OSHA 301 Incident Report, and OSHA 300A summary. As of now, employers must only give information if it is requested, but such practices are on the way out. According to OSHA, this final rule will not come into effect until approximately March 2015. It is already creating resistance, however, as many business advocates worry that new electronic posting may create privacy problems for employers.
The Employment Non-Discrimination Act (ENDA)
A bill that would prohibit employment discrimination on the basis of sexual orientation or gender identity is not expected to pass the House. Even still, it represents an important shift toward providing more protection for the LGBT community. Expect other laws and court rulings related to LGBT protection to make headlines in 2014.
The legal and regulatory environment is always changing. Keeping abreast of updates and making a good faith effort to keep compliant is essential. Knowing the trends and areas of focus by regulatory bodies can help you proactively address high-risk areas for your business. Remember to supplement your compliance plan by checking with the states (counties and cities too) where you do business for additional changes.
Be sure to work with an employment attorney – this article does not constitute legal advice. Always seek counsel from local HR professionals – your diligence in navigating situations and keeping policies and practices current will pay off.
This content was developed for the PHCC Educational Foundation by TPO, Inc. (www.tpo-inc.com). Please consult your HR professional or attorney for further advice, as laws may differ in each state. Laws continue to evolve; the information presented is as of December 2014. Any omission or inclusion of incorrect data is unintentional. Please note this article is not intended to provide legal advice or to substitute for supervisor employment law training.
The PHCC Educational Foundation, a partnership of contractors, manufacturers and wholesalers was founded in 1987 to serve the plumbing-heating-cooling industry by preparing contractors and their employees to meet the challenges of a constantly changing marketplace. If you found this article helpful, please consider supporting the Foundation by making a contribution at http://www.phccfoundation.org.
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