Paragon Business Services - June HR Advisor Newsletter

June 5, 2012 - PRLog -- Welcome

We hope your summer is off to a bright and productive start.  As part of the recent upgrades to the HR Support Center, we hope you will take advantage of the following enhancements: the Wage and Hour Quick Guides section and the additional articles within the Knowledge section. Lastly, since June is National Safety Month, make sure you view the safety-related documents (i.e. checklists, guides, and forms) in the HR Support Center.

HR Alerts

New Pension Benefit Statements Rule Proposal. Expected to make an announcement in June 2012, the Employee Benefits Security Administration (EBSA) is working on a proposed Employee Retirement Income Security Act (ERISA) rule that would require the presentation of a participant's accrued benefits as a lifetime income stream of benefit payments.

New Proposals on Employer Health Insurance Coverage. By June 11, 2012, the Internal Revenue Service (IRS) will accept comments about a new proposed ruling. The Centers for Medicare & Medicaid Services (CMS), Center for Consumer Information and Insurance Oversight (CCIIO), and the IRS released four documents related the Affordable Care Act (ACA) that address employer-provided group health insurance plan reporting requirements and the availability of premium tax credits to individuals and families.  The ACA makes tax credits available to help individuals pay insurance premiums, but these credits do not apply if the individual is eligible for employer-provided coverage that is both affordable (in terms of required employee contribution to premium payments) and provides “minimum value” (in terms of overall cost-sharing).                  

HHS New Medical Loss Ratio Reporting Requirement. The Department of Health and Human Services (HHS) Centers for Medicare & Medicaid Services (CMS) issued a final rule that imposes new reporting requirements on health insurance issuers that meet or exceed the applicable Medical Loss Ratio (MLR) standard for the 2011 reporting year. CMS requires issuers that meet or exceed the MLR standard to send a notice to policyholders that the issuer has met the minimum MLR standard for the 2011 reporting year. An issuer must provide the notice with the first plan document to enrollees on or after July 1, 2012.  

Unemployed Applicants: The New Protected Class

In today’s economic times, a competitive job force embraces workers with various knowledge, skills, abilities, education, and experience levels. Hiring managers attempt to compare and contrast these items when determining the best job candidate for a specific position.  With respect to experience, many hiring managers consider long gaps in employment history on the resume or employment application to be a strike against a potential job candidate. However, due to the high levels of unemployment the country has experienced in the past few years, lawmakers are taking measures to ensure the job candidates who have experienced recent periods of unemployment are still considered viable candidates.

The Equal Employment Opportunity Commission (EEOC) is the agency that oversees discrimination in hiring practices. Some of the traditional protected classes include race, color, religion, national origin, age (40 and over), disability, military or veteran status, etc. Protected classes were developed from previous anti-discrimination laws such as the Civil Rights Act of 1964, Age Discrimination in Employment Act (ADEA), Equal Pay Act, Americans with Disabilities Act (ADA), and the Genetic Information Nondiscrimination Act (GINA).                  

On April 5, 2012, President Obama signed into law the JOBS Act (Jumpstart Our Business Startups) that is intended to prohibit employers from discriminating against job applicants because they are unemployed. Under the Act, it is “an unlawful employment practice” if a business with 15 or more employees refuses to hire a person “because of the individual’s status as unemployed.”  Unselected job applicants will have the right to file a complaint with the EEOC if they are disqualified from consideration due to a recent period of unemployment. The JOBS Act contains the “Fair Employment Opportunity Act of 2011” (FEOA) that treats unemployed job applicants as a protected class under Title VII. The FEOA would make it an unlawful employment practice for an employer or employment agency that:

*Fails or refuses to consider or hire an individual based upon his or her status as unemployed.
*Instructs an employment agency to disqualify an unemployed individual from consideration, screening, or referral for employment.
*Refuses to consider or refer an unemployed individual for a job opportunity.
*Publishes advertisements which indicate that unemployed individuals are disqualified or will not be considered for employment opportunities.    
         
Employers are encouraged to look carefully at their hiring methods (especially when viewing recent gaps in employment history) and to assess the role an applicant’s unemployed status has on hiring decisions. There are several remedies that apply within the JOBS Act that include injunctive relief, reinstatement, lost wages, punitive damages, emotional distress damages, and reasonable attorney’s fees and costs. Employers need to use caution when inquiring into the reasons underlying an applicant’s current unemployment status. Remember, anything more than a minimal investigation into an applicant’s current status (i.e. unemployed) may be considered as an influencing factor in the hiring decision. This can expose the employer to liability if the individual is not ultimately considered or hired for a position.              

Q & A

Direct Deposit

Q. How can we encourage more of our employees to use direct deposit?  

A. Although some state laws indicate employers cannot “require” direct deposit, employers should still inform employees about the benefits of using direct deposit options. Some benefits include:                                

*Convenience and time savings. Reduces travel time to go to the bank to cash the check.                
*Safety and security. It reduces issues around lost, stolen or misplaced checks.                
*Reliability. The money will be available the morning of the payment or sooner.                
*Money management. Helps with managing money into different accounts (i.e. savings plan).                
*Eco-friendly. It helps the environment by electing a “paperless” option, which saves trees.  

Job Reference Immunity Laws – Who’s in Favor?

Many businesses have initiated “Job Reference” policies restricting the nature of information that may be provided about current and former employees to third parties.  While it is at times tempting to feel obligated to provide detailed information regarding a former employee’s performance in an effort to help the prospective employer, doing so may expose the company to some liability. Former employees have successfully sued their past employers for libel, slander, defamation, or negligent misrepresentation arising out of job references. Therefore, it is recommend proceeding with caution with job references and verifications in order to reduce the company’s exposure.              

A fairly common company policy is to only release information that is completely objective in nature, such as the former employee’s dates of employment and job title. If the prospective employer would like additional information (such as salary information), generally employers require the prospective employer to send a written request for such information that includes the former employee’s written authorization to release the information. Company policies should prohibit the release of information that is subjective in nature.  

Tool of the Month: Risk Management Guide

Risk management consists of (1) identifying and analyzing the events that may cause  loss to a business and (2) choosing the best ways to address potentials for such loss.