As a service to our clients and the community, listed below are helpful alerts on important legal updates in the area of employment law and employee benefits. In addition, our recent client advisories can be viewed and downloaded by clicking on the links below.
Client Alert - October 6, 2011
The National Labor Relations Board announced today that it has postponed to January 31, 2012 the implementation date for its new employee-rights notice-posting rule. The rule previously required employers to comply with the posting compliance beginning November 14, 2011.
The NLRB indicates that the postponement will allow for enhanced education and outreach to employers, particularly those who operate small and medium sized businesses. No other changes have been made to the rule or the form and content of the notice.
Now beginning January 31, 2012, most private sector employers will be required to post the 11-by-17-inch notice, which is available at no cost from the NLRB through its website, either by downloading and printing or ordering a print by mail. To access the form notice, go to: https://www.nlrb.gov/poster.
Client Alert - May 26, 2011
ThePaid Sick Day Bill (SB-913) was passed by the Connecticut Senate yesterday, May 25th, on a 18-17 vote. The Senate represented the only viable obstacle to the bill becoming law. You should anticipate that this bill will pass in the House; Governor Malloy has stated he will sign it. To view the bill in its current form: SB-913 Passed by Senate.
We'll discuss this bill and other legislative updates at our June 14th seminar.
This advisory contains information about recent developments in health care reform and the progress of Connecticut's SustiNet; an explanation of the U.S. Supreme Court's ruling on third-party retaliation by employers; and, guidance on U.S. DOL efforts to crack down on improper classifications of workers. In addition, we've included a brief update on the paid sick leave bill proposed in Connecticut and on new proposed H-1B registration procedures.
June 23, 2010: Client Alert - State Issues Model CT Continuation Notice Form for New 30 Month Continuation
This morning, Connecticut Department of Insurance posted a new model Notice form to be used to provide notice to current and future COBRA or state continuation beneficiaries of their eligibility for extended continuation coverage for up to 30 months. The form may be used as a supplement to your current COBRA (or state continuation) form.
Effective May 5, 2010, Public Act 10-13 extended coverage for certain employees who elect continuation of health coverage for up to 30 months for individuals who lose coverage due to a lay-off, termination of employment (except for gross misconduct), leave of absence or reduction in hours. This change applies to employees covered under Connecticut fully insured small employer and large employer plans. Individuals who are currently on state or federal COBRA as of May 5, 2010, or individuals who experience a qualifying event as of May 5, 2010 are impacted by this law.
June 14, 2010: Client Alert - HHS Issues Regulations on "Grandfathered" Plans
The Department of Health and Human Services issues new regulations today which define when health plans lose their grandfathered status. Based on the plan in effective on March 23, 2010, the new rule provides that plans will lose their grandfather status if they choose to make significant changes that reduce benefits or increase costs.
The “grandfathered” status of health plans is important because grandfathered plans do not have to offer essential health benefits, do not have to provide free preventive care, are immune from the required appeals process, and are not subject to economic discrimination standards.
Under the new regulations, a health insurance plan in effect on March 23, 2010, will lose its exemption, that is, its “grandfathered” status, if:
• the employer changes insurance companies; • it eliminates all benefits for a particular condition or otherwise significantly cuts or reduced benefits; • it increases deductibles or co-payments by more than the rate of medical inflation plus 15 percentage points; • it raises deductibles by more than a percentage equal to medical inflation plus 15 percentage points; • the employer reduces its contribution so that its share of the total cost of coverage declines by more than 5 percentage points; or, • the plan adds or tightens an annual limit on what the insurer pays.
As a service to our clients, we have attached a copy of the newly released HSS Fact Sheet which addresses the new regulations. The regulations will be issued in the near future and should be accessible on the HHS website: http://www.hhs.gov.
May 13, 2010: Client Alert - Connecticut Extends Continuation of Group Health Insurance to 30 Months
Yesterday, the Connecticut Insurance Department issued a Bulletin regarding the new Connecticut law, effective May 5, 2010, that now permits employees/group certificate-holders who lose coverage under a Connecticut fully insured employer group heath policy to elect continuation of coverage for up to 30 months for a qualifying event of layoff, reduction of hours, leave of absence, or termination of employment.
This means that Connecticut fully insured plans subject to state or federal COBRA continuation must provide individuals who elect continuation coverage (due to a qualifying event of layoff, reduction of hours, leave of absence, or termination) a total of 30 months of continuation coverage, rather than just 18 months, so long as the individual makes timely premium payments.
This new requirement to extend continuation for a total of 30 months applies to full insured group health plans issued in Connecticut for employer groups under and over 20 employees. The law does not apply to self-insured plans, plans not issued through the Connecticut Insurance Department, or to stand-alone dental, vision or prescription drug coverage policies.
Notice obligations fall on health insurers and health care centers that have issued a group health insurance policy. Insurers and health care centers, in conjunction with group policyholders and employers, are required to provide notice of the continuation of coverage to impacted individuals within on or before July 4, 2010. Employers should expect to receive information and/or notice forms from their carrier on this new law, so that the insurer and employer can fulfill the notice obligations.
Employees and plan participants who are eligible for the extended 30 months of continuation coverage are those who become have a qualifying event on or after May 5, 2010, as well as those who are currently in the middle of an 18 month continuation period. The new law does not create a second right to elect continuation coverage.
As for the federal COBRA Subsidy under the American Recovery and Reinvestment Act (ARRA) that was previously extended to provide a subsidy to individuals experiencing a qualifying event of involuntary termination occurring on or before May 31, 2010, the COBRA subsidy period remains 15 months. Connecticut’s extension of the continuation coverage period to 30 months does not alter or extend the COBRA Subsidy period of 15 months.
You can read the Connecticut Insurance Department’s Bulletin (HC-77) dated May 11, 2010 which further explains this new law, or you can access the Bulletin by clicking the following link: http://www.ct.gov/cid/lib/cid/BullHC77.pdf.
April 16, 2010: Client Alert - COBRA Subsidy Extended Through May 31, 2010
The COBRA premium subsidy law has been extended once again – until May 31, 2010, instead of expiring on March 31, 2010. The new law, “Continuing Extension Act of 2010,” was signed by President Obama last night. The law extends unemployment benefits the period for eligibility for the COBRA subsidy, through May 31, 2010. Without this bill, to be an assistance eligible individual (AEI) for purposes of the COBRA subsidy (and only have to pay 35% of the COBRA cost from 15 months), the COBRA qualifying event must have been an involuntary termination occurring between September 1, 2008 and March 31, 2010 – now that period extends through May 31, 2010. Otherwise, the provisions of the COBRA subsidy remain unchanged.
Employers and plans should continue using COBRA enrollment forms that contain ARRA COBRA subsidy right information through May 31, 2010. If COBRA forms were sent for terminations from April 1, 2010 to present that did not include COBRA subsidy information, revised forms should be sent to employees and beneficiaries.
April 2010: Client Alert - Health Care Reform Creates Immediate Small Employer Tax Credit
Selected provisions of the new health care reform immediately impact certain small employers. Many of the health care reforms don’t kick this year or until 2014, however this new tax credit is already in force. The tax credit can be claimed on your return for the 2010 tax year.
The small business health care tax credit is in immediate effect for qualifying employers who have less than 25 full-time equivalent employees and average annual wages below $50,000. Note that the definition of “full-time equivalent” incorporates part-timers and excludes seasonal employees, business owners and their families. For some employers, these exclusions may be particularly important. A qualifying employer, either taxable or tax-exempt, who covers at least 50% of the cost of health care coverage for some of its workers (based on the single rate) is eligible for the tax credit. The maximum credit is worth up to 35% of the small business’s premium costs in 2010. On January 1, 2014, the credit increases to 50% for taxable employers. The credit phases out for firms with average wages between $25,000 and $50,000 and for companies with between 10 and 25 full-time equivalent workers. For tax-exempt qualified employers, the maximum credit is 25% for 2010 through 2013. The IRS has just posted helpful information on the credit on its website, including a series of Q&A’s that we have attached here. It is worth reviewing to determine if you may be able to take advantage of the credit on your 2010 return.
In addition, the IRS supplied some sample numbers for a few hypothetical businesses to help businesses understand the math. For example, an auto repair shop with 10 employees that has a payroll of $250,000, with each worker averaging $25,000, and spends $70,000 annually on health insurance premiums would collect a credit of $24,500 for 2010 (35% credit). The math is less clear-cut for most actual small employers, but the IRS does a decent job laying down the basics for small employers at: http://www.irs.ustreas.gov/newsroom/article/0,,id=220809,00.html.
Small employers may want to work the numbers now to see if minor adjustments may ensure eligibility for the credit for 2010 – the credit represents real savings for eligible employers.
Disclaimer: The materials in this Website are provided for informational purposes only and do not constitute legal advice. This Website is not intended to create and does not create an attorney-client relationship between you and Robert Noonan & Associates, or any of its attorneys. You should not act or rely on any information in the site without seeking the advice of an attorney.