Nierenberg Employment Law PLLC

Consulting · Litigating · Training

Archives

New Aid to Employers Paying Health Benefits for Early Retirees

Joe Nierenberg / May 07th 2010 / No Comments

The White House announced Tuesday that it would help pay medical bills for early retirees who have health insurance provided by their former employers. Under the program, the federal government can reimburse employers for 80 percent of the cost of claims from $15,000 to $90,000 a year for a retired worker who is 55 or older and not eligible for Medicare.

The program will run from June 1 of this year to Jan. 1, 2014, when many early retirees will be able to enroll in health plans offered through new state-based markets known as insurance exchanges. John J. Castellani, president of the Business Roundtable, which represents large employers, welcomed the new program, saying it would make health benefits “more affordable for employers and early retirees and their families.” Kathleen Sebelius, the secretary of health and human services, predicted that 4,500 employers — 3,000 private entities and 1,500 state and local governments — would seek federal aid under the program.

Employers can apply through the U.S. Department of Health and Human Services. Applications will be available by the end of June 2010.

The federal aid will be available to private employers, state and local governments, nonprofit and religious organizations and labor unions that sponsor health benefit plans. It will be available to employers who pay premiums to insure early retirees, as well as to employers who assume the risk themselves and pay claims with their own assets. Under the new law, employers must use the federal money to reduce “health benefit costs” for themselves or their retirees — for example, by reducing premiums, deductibles or co-payments. As a condition receiving federal aid, employers must maintain their current contributions to the cost of retiree health benefits. Many companies expected to apply for the new program already receive federal subsidies under a 2003 law to help offset the cost of providing prescription drug benefits to retirees, Ms. Sebelius said.

Edited from the New York Times, May 7, 2010

Preparing for the Flu

Joe Nierenberg / September 05th 2009 / No Comments

The influenza season approaches. This year the several seasonal virus varieties are joined by a new strain that requires planning and preparation. Previously called “swine flu” and now sometimes known as Pandemic H1N1, the new strain combines the familiar symptoms and dangers of influenza with the concerning prospect of mutation into more severe forms that could spread quickly.

Summary

Employers of all sizes in all industries should prepare now for Pandemic H1N1 influenza outbreaks in their communities. Some preparations are common to all grades of potential outbreak, from mild to severe, and require some thought but limited advance planning. Other preparations, more appropriate for a severe outbreak, require advance planning. The time to develop those plans is now.

Prepare for increased absences. Sending sick workers home and keeping them there until they are better will control the spread of the disease and limit operational interruptions. Family-related leave policies should be reviewed and, if necessary, modified in order to accommodate the likely prospect of schools’ dismissing students and child care programs’ closing.

Encourage relevant hygiene. Post notices about covering coughing mouths and sneezing noses. Ensure availability of soap and tissue. Increase the frequency of surface cleaning.

Plan now for steps that will become necessary if an outbreak becomes more severe. Work environments and processes may need modification to increase distances between workers. Health screening that complies with state and federal law may be advisable in some circumstances.

From the Centers for Disease Control:

Actions Employers Should Take Now

* Review or establish a flexible influenza pandemic plan and involve your employees in developing and reviewing your plan;

* Conduct a focused discussion or exercise using your plan, to find out ahead of time whether the plan has gaps or problems that need to be corrected before flu season;

* Have an understanding of your organization’s normal seasonal absenteeism rates and know how to monitor your personnel for any unusual increases in absenteeism through the fall and winter.

* Engage state and local health department to confirm channels of communication and methods for dissemination of local outbreak information;

* Allow sick workers to stay home without fear of losing their jobs;

* Develop other flexible leave policies to allow workers to stay home to care for sick family members or for children if schools dismiss students or child care programs close;

* Share your influenza pandemic plan with employees and explain what human resources policies, workplace and leave flexibilities, and pay and benefits will be available to them;

* Share best practices with other businesses in your communities (especially those in your supply chain), chambers of commerce, and associations to improve community response efforts; and

* Add a “widget” or “button” to your company Web page or employee Web sites so employees can access the latest information on influenza: www.cdc.gov/widgets/ and www.cdc.gov/SocialMedia/Campaigns/H1N1/buttons.html

Important Components of an Influenza Pandemic Plan

* Be prepared to implement multiple measures to protect workers and ensure business continuity. A layered approach will likely work better than using just one measure.

* Identify possible work-related exposure and health risks to your employees. The Occupational Safety and Health Administration (OSHA) has developed tools to determine if your employees are at risk of work-related exposures and, if so, how to respond (see www.osha.gov/dsg/topics/pandemicflu/index.html).

* Review human resources policies to make sure that policies and practices are consistent with public health recommendations and are consistent with existing state and federal workplace laws (for more information on employer responsibilities, employers should visit the Department of Labor’s and the Equal Employment Opportunity Commission’s websites at www.dol.gov and www.eeoc.gov).

* Allow employees to stay home if they are ill, have to care for ill family members, or must watch their children if schools or childcare facilities close.

* Explore whether you can establish policies and practices, such as flexible worksites (e.g., telecommuting) and flexible work hours (e.g., staggered shifts), when possible, to increased the physical distance among employees and between employees and others if local public health authorities recommend the use of social distancing strategies. Ensure that you have the information technology and infrastructure needed to support multiple workers who may be able to work from home.

* Identify essential business functions, essential jobs or roles, and critical elements within your supply chains (e.g., raw materials, suppliers, subcontractor services/products, and logistics) required to maintain business operations. Plan for how your business will operate if there is increasing absenteeism or these supply chains are interrupted.

* Set up authorities, triggers, and procedures for activating and terminating the company’s response plan, altering business operations (e.g., possibly changing or closing operations in affected areas), and transferring business knowledge to key employees. Work closely with your local health officials to identify these triggers.

* Plan to minimize exposure to fellow employees or the public if public health officials call for social distancing.

* Establish a process to communicate information to workers and business partners on your 2009 H1N1 influenza response plans and latest 2009 H1N1 influenza information. Anticipate employee fear, anxiety, rumors, and misinformation, and plan communications accordingly.

Resources

The following bulletins should be distributed to managers with relevant responsibilities:

Federal Minimum Wage Increases

Joe Nierenberg / July 23rd 2009 / No Comments

Effective July 24, 2009, the federal minimum wage increases to $7.25 per hour. This is the last increase required by the 2007 Minimum Wage Act.

Employers of covered employees must post a notice that describes, among other things, employees’ minimum wage rights. A link for posters is available below, under “Resources.” Note that the U.S. Department of Labor is likely to revise the currently available posters.

Minnesota employers who are not covered by the federal Fair Labor Standards Act’s minimum wage provisions are likely to be covered by the state’s wage and hour laws. Minnesota’s minimum wage remains unchanged, at $5.25 per hour for employers grossing less than $625,000 and $6.15 per hour for employers at or above that level. More information on Minnesota’s minimum wages, including some exemptions, information on the training wage, and discussion of the fact that there is no tip credit allowed in Minnesota, is provided in the official notice available below, under “Resources.”

Whether a particular classification of employee is covered by the federal minimum wage law is an analysis that is beyond the scope of this brief article. The answer depends in part on the nature of the employer’s enterprise and in part on the specific duties of the employee. If you have questions about coverage, you might contact any of the following: the Wage and Hour Division of the Employment Standards Administration of the U.S. Department of Labor; your employment law advisor; or this firm.

Resources:

  1. Federal minimum wage and other wage-and-hour posters
  2. Frequently asked questions about federal employment posters
  3. Compliance assistance with federal wage-and-hour issues
  4. Minnesota employment posters
  5. Information on Minnesota minimum wage law

E.F.C.A. Moves Ahead with Revisions

Joe Nierenberg / July 17th 2009 / No Comments

The Employee Free Choice Act is a bill that was drafted when it had no chance of moving successfully through Congress. It sought to eliminate union elections by allowing unions unlimited time to campaign and then requiring employers to accept the union if sufficient numbers of employees expressed interest. The Bill’s supporters argued that eliminating secret ballot elections would prevent employers from coercing employees during a campaign period. In reality, however, coercion occurs at the point when organizers ask coworkers to sign on to a union campaign. The Bill would have retained that problem, while eliminating an employer’s right to express differing views.

Yesterday Democratic Senators negotiated a compromise to the Bill by retaining an employee’s right to a secret ballot election on becoming unionized. This is a significant development and a gain for employees and management alike.

The Bill still retains other, poorly thought out provisions. For example, if there is an impasse in negotiating a first contract, a third party will be brought in to impose contract terms. But the agency that would manage that process is not presently staffed to do so, and the procedure by which a third party would decide which proposals to impose has not been outlined. Additionally, the civil penalties provided in the Bill would be based on a host of factors that do not include the effect on the employer.

It is clear that the Bill is progressing through the Senate, but it is not the cakewalk that it’s organized supporters had hoped for. Stay tuned.

Resources:

  1. The text of E.F.C.A. as it was introduced originally in the House.
  2. An article in the N.Y. Times on the recent negotiations to retain the secret ballot.

Follow on Twitter

Joe Nierenberg / July 16th 2009 / No Comments

Employee Relations Insight is again carrying regular updates on topics of workplace law and procedure. In addition to this blog and the associated RSS feed (see the bottom of the sidebar), we will be pushing blog-related and other relevant announcements by Twitter. You can subscribe either by visiting here and clicking “follow,” or by sending a text message to Twitter from your phone with the words “follow Nierenberg_Law”.

New E.E.O.C. Guidance on Severance Agreements

Joe Nierenberg / July 16th 2009 / No Comments

On July 15, 2009, the U.S. Equal Employment Opportunity Commission issued updated and comprehensive guidance on the issue of employee waivers of discrimination claims contained in severance agreements. Although the recent guidance is directed to employees, it contains valuable information for management, as well. The document
addresses, among other topics, the requirements of the Older Workers Benefit Protection Act. It also provides a checklist for employees, which has obvious value for human resources staff who are drafting material or preparing for layoff conferences, and model text for an enforceable waiver.

The guidance pertains only to the limited issues presented by discrimination waivers in severance agreements. There are many related issues regarding both general compliance requirements and also problems arising from specific workers or worksites that the guidance does not attempt to address. It is important, therefore, not only to review this recent expression of the E.E.O.C.’s position but also to continue to use more comprehensive checklists, involve in-house expertise, or consult with an employment lawyer.

Additional Resources from U.S. Department of Labor

Joe Nierenberg / May 06th 2008 / No Comments

The U.S. Department of Labor today unveiled the FirstStep Recordkeeping, Reporting and Notices e-laws Advisor. By using this tool, employers can determine which recordkeeping, reporting, and notice requirements apply to them under the major laws administered by the federal Labor Department. This new advisory service has been integrated with the revised FirstStep Poster and FirstStep Employment Law Overview advisory services. All three services are intended to help employers identify the federal employment laws that are relevant to them and then to provide assistance in complying with the requirements. For further information, go to this web page. (Users should note that, while the site is a valuable addition to Internet employment law resources, it does not provide guidance on all of the regulations that the Department administers or on any state laws, nor can it tailor recommendations to specific client objectives.)

F.M.L.A. Amended: 26 Weeks for Military-related Medical Reasons

Joe Nierenberg / February 04th 2008 / No Comments

The federal Family and Medical Leave Act has been amended to add two types of required leaves of absence. The 2008 National Defense Authorization Act (“N.D.A.A.”) amends the F.M.L.A. to provide a new 26 week leave to care for a family member who is in the military and is undergoing treatment or is temporarily disabled due to a serious injury or illness. The N.D.A.A. also extends the familiar 12 week leave to care for a family member who has experienced an as-yet-undefined “qualifying exigency.”

Prior to the 2008 N.D.A.A., the F.M.L.A. required covered employers to grant eligible employees up to twelve workweeks of unpaid leave during a twelve month period for one or more of the following reasons:

  • for the birth and care of the newborn child of the employee;
  • for placement with the employee of a son or daughter for adoption or foster care;
  • to care for an immediate family member (spouse, child, or parent) with a serious health condition; or
  • to take medical leave when the employee is unable to work because of a serious health condition.

The National Defense Authorization Act amendments to the F.M.L.A. extend the scope of the law to permit a “spouse, son, daughter, parent, or next of kin” to take up to 26 workweeks of leave to care for a “member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness.” This part of the N.D.A.A. became effective on January 28, 2008. The Department of Labor is preparing guidance and proposed regulations to implement the new leave.

The amendments also extend the F.M.L.A. by permitting an employee to take leave for “any qualifying exigency (as the Secretary [of Labor] shall, by regulation, determine) arising out of the fact that the spouse, or a son, daughter, or parent of the employee is on active duty (or has been notified of an impending call or order to active duty) in the Armed Forces in support of a contingency operation.” This part of the amendment is not yet effective; it will become effective after the Department of Labor issues final regulations defining “any qualifying exigency.”

Limitations on Vacation Leave Payouts

Joe Nierenberg / November 18th 2007 / 1 Comment

Minnesota’s highest court has issued its opinion in Lee v. Fresenius Medical Care, Inc. This case addresses the question of whether an employer can attach conditions to an employee’s being paid for accrued but unused vacation leave.

Susan Lee worked for Fresenius Medical Care, and had accrued unused paid time off. Fresenius terminated Lee for alleged misconduct. The Fresenius employee handbook provided:

Unless otherwise required by state law, if you do not give acceptable notice, you may not be paid for earned but unused PTO, and you may not be considered eligible for re-employment. In addition, if your employment is terminated for misconduct, you will not be eligible for pay in lieu of notice or payment of earned but unused PTO unless required by state law.

Fresenius denied Lee payment for her unused PTO; Lee sued, arguing that, because she had earned the PTO under the employer’s policy and because accrued PTO is a type of wage, Fresenius violated a Minnesota wage payment statute by refusing to pay for the unused time.

The Minnesota Supreme Court ruled that employers are not required to offer vacation leave or pay in lieu of leave. If they do extend such an offer, they can define eligibility for the leave or payments as they wish, so long as the policy does not violate any law. For example, an employer could offer vacation leave so that it accrues at a certain rate each month, but condition the use of the leave on approval by a manager; or an employer could limit the carryover of leave from one year to the next and require that most or all of an employee’s available leave be taken within some period of time; or—as in the Lee case—an employer could require a minimum notice of termination before the employee is entitled to be paid for accrued but unused leave, or even prohibit such payments completely if the employee is terminated for cause.

In Lee, the Court ruled:

[W]hen employers choose to offer paid time off as a benefit, employers and employees can contract for the circumstances under which employees are entitled to paid time off and payment in lieu of paid time off, so long as the contract provisions are not prohibited by or otherwise in conflict with a statute.

The Court essentially adopted its now-familiar analysis of how an employee handbook can become a binding contract. If the policy text is sufficiently clear, if the employee has sufficient notice of the policy, and if the employee thereafter signifies his or her acceptance of the policy by continuing to work for the employer, then the policy may be contractually binding.

Since the Supreme Court announced this “unilateral contract” approach to employee handbooks in 1983, most employers with handbooks have attempted to avoid any potentially binding effect by plainly stating that the provisions of the handbook are not intended to form a contract. The Lee case, however, supports the better practice of disclaiming the contractual effect of only some provisions while emphasizing that certain other provisions are binding, including for example the limitations on vacation leave or pay.

The Lee case had a strenuously argued dissent. The dissenting judge wrote that, if an employer’s policies define how vacation leave is earned, then once it has been earned it cannot be taken away without constituting an unlawful forfeiture. The majority rejected that analysis, finding instead:

[E]mployers may offer, and employees may accept, a contract provision that attaches conditions to the right to accrued vacation “wages,” whether in the form of actual paid time off or payment in lieu of paid time off…. [S]uch conditions define what has been earned.

The principles of the Lee case apply to vacation, paid time off, non-statutory sick leave, and a range of other benefits that are not mandated by law. Most vacation leave or paid time off policies that were written or revised by Nierenberg Employment Law have been carefully drafted to provide a benefit of time off only, and not payment in lieu of leave; those policies are consistent with this new case and should not need revision. However, all employers should nevertheless review their vacation, sick leave, and paid time off policies to be sure that they reflect the policies and values of the organization and that, if desired, they take advantage of the opportunities presented by this case.

New Minimum Wage Poster and Requirements

Joe Nierenberg / July 06th 2007 / No Comments

A revised Federal minimum wage poster, reflecting the recently enacted minimum wage increases, is now available free of charge on the Department of Labor’s Web site. Every employer of employees subject to the Fair Labor Standard Act’s minimum wage provisions must post a notice explaining the Act in a conspicuous place in all of their establishments so that employees can read it without difficulty.

Effective July 24, 2007, the federal minimum wage for covered non-exempt employees will be $5.85 per hour. The minimum wage increases to $6.55 per hour effective July 24, 2008; and $7.25 per hour effective July 24, 2009.

The tip credit provisions of the federal F.L.S.A. remain the same. An employer is still required to pay $2.13 an hour in direct wages if that amount plus the tips received equals at the least the Federal minimum wage, provided the employer has informed the employee of the tip credit being taken, the employee retains all tips except to the extent they participate in a valid tip pooling arrangement, and the employee customarily and regularly receives more than $30 a month in tips.

Many states also have minimum wage laws. Covered employers must comply with both federal and state requirements. In Minnesota, for example, there are several minimum wages, depending on the size of the organization:

Large employer — $6.15 an hour. “Large employer” is defined as any enterprise whose annual gross volume of sales made or business done is not less than $625,000.

Small employer — $5.25 an hour. “Small employer” is defined as any enterprise whose annual gross volume of sales made or business done is less than $625,000.

Training wage — $4.90 an hour. An employer may pay $4.90 an hour to new employees who are younger than age 20 during their first 90 consecutive days of employment. Permanent or current employees may not be displaced by new employees covered by the training wage.

Minnesota law does not provide a tip credit such as that found in the federal law.

Minnesota recognizes the following exemptions from state minimum wage requirents (among others): babysitters, taxicab drivers, volunteers of nonprofit organizations, elected government officials, people providing police or fire protection, and employees subject to the provisions of the U.S. Department of Transportation (drivers, drivers’ helpers, mechanics and loaders).

Please read the Terms of use and legal notices for this blog.

Archives