31 Jan

January 2020 Federal HR Updates

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Employee Retirement Income Security Act – Increased Penalties

What happened?
The Department of Labor (DOL) has increased the penalties for employers if they are found to be in violation under the Employee Retirement Income Security Act of 1974 (ERISA) for group health plan reporting and disclosures.

What are the details?
The following penalties apply effective after January 15, 2020:

  • Summary of Benefits and Coverage (SBC): Up to $1,176 per participant or beneficiary for failure to provide group health plan participants and beneficiaries with an SBC.
  • Employer Children’s Health Insurance Program (CHIP) Notice: Up to $119 per day per employee for failure to provide a CHIP Notice to employees in states that offer group health plan premium assistance through a state CHIP.
  • Summary Plan Description (SPD): Up to $159 per day (not to exceed $1,594 per request) for failure to furnish an SPD to the DOL upon request.
  • Form 5500: Up to $2,233 per day for failure to file an annual report with the DOL (unless a filing exemption applies).

What do employers need to do?
As always, employers should be mindful and ensure they are abiding by the requirements set forth in the Reporting and Disclosure Guide for Employee Benefit Plans.


DOL Issues Final Rule on Joint Employer Relationship

What happened?
The DOL published its final rule January 16, 2020. This final rule will become effective March 16, 2020. The final rule puts clarity on the DOL’s interpretation and adopts a more modified version of a four-factor test.

What are the details?
To determine whether an entity is a joint employer, DOL’s new test examines whether the alleged joint employer:

  1. hires or fires the employee;
  2. supervises and controls the employee’s work schedule or conditions of employment to a substantial degree;
  3. determines the employee’s rate of pay and method of payment; and
  4. maintains the employee’s employment records.

The final rule also clarifies that the potential joint employer must exercise one or more of the four indicia of control to be jointly liable under the FLSA; it is insufficient that an entity has the ability, power, or reserved contractual right to exercise control.

What do employers need to do?

  • Companies should remain diligent over the use of contingent workers by business lines and potential business partners to ensure they are not exercising direct or even indirect control.
  • Companies should make sure that vendors, franchisees, and other business partners determine rates, methods of pay, and how, when, and where work will be performed.
  • Companies should also take steps to confirm who controls hiring, training, and conducting evaluations.

Bill: https://www.federalregister.gov/documents/2020/01/16/2019-28343/joint-employer-status-under-the-fair-labor-standards-act

Article: https://www.jdsupra.com/legalnews/dol-issues-final-rule-on-flsa-joint-32355/



OSHA 300A Posting Requirements

What happened?
By February 1 of each year, employers that are subject to the Occupational Safety and Health Administration’s (OSHA) routine recordkeeping requirements, must post copies of their completed OSHA Form 300A (“Summary of Work-Related Injuries and Illnesses”) from the previous year in visible locations within their employees’ workplaces.

What are the details?
The postings must then be kept in place until at least April 30 every year. These requirements apply to all employers that are not in a partially exempt industry and have more than 10 employees.

What do employers need to do?
On February 1, 2020, employers subject to OSHA recordkeeping requirements must ensure that copies of their completed Forms 300A from 2019 are posted in each of their establishments in a conspicuous place or places where notices to employees are customarily posted.

Until April 30, 2020, these employers must also ensure that their Form 300A postings remain in place and are not altered, defaced, or covered by other material.

OSHA300A: https://www.osha.gov/recordkeeping/new-osha300form1-1-04-FormsOnly.pdf

Article: https://www.osha.gov/recordkeeping/ppt1/RK1exempttable.html


OSHA Electronic Reporting Deadlines

What happened?
Each year, employers that are subject to OSHA’s electronic reporting requirements must submit data from their OSHA Form 300A (“Summary of Work-Related Injuries and Illnesses”) from the previous calendar year, using OSHA’s Injury Tracking Application (ITA). For 2019 information, OSHA started accepting electronic submissions as of January 2, 2020.

What are the details?
Employers have until March 2, 2020, to complete their 2019 electronic reports. These requirements apply to:

  • Covered establishments in a high-risk industry with 20-249 employees; and
  • Covered establishments with 250 or more employees.

What do employers need to do?
Employers subject to OSHA electronic reporting should ensure that they have entered data from their 2019 OSHA forms 300A into OSHA’s ITA by March 2, 2020.

Article: https://www.federalregister.gov/documents/2016/05/12/2016-10443/improve-tracking-of-workplace-injuries-and-illnesses#h-4


IRS Issues Standard Mileage Rates for 2020

What happened?
The Internal Revenue Service (IRS) issued the 2020 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes.

What are the details?
Beginning on January 1, 2020, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will be:

  • 57.5 cents per mile driven for business use, down one-half of a cent from the rate for 2019.
  • 17 cents per mile driven for medical or moving purposes, down three cents from the rate for 2019.
  • 14 cents per mile driven in service of charitable organizations.

What do employers need to do?
Ensure employers are paying employees accordingly.

Bill: https://www.irs.gov/pub/irs-drop/n-20-05.pdf



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