Benefits Consideration for Onboarding Furloughed and Laid Off Employees
As the COVID-19 pandemic continues to create obstacles for the workplace, many professionals are still having to continue with their day-to-day work lives which include having hard discussions with furloughed and laid-off employees. Read this blog post to learn helpful tips on re-enrolling employees into their benefits.
COVID-19 continues to throw us curveballs. While some states that were continuing on their path to recovery are having to backtrack, others have managed to temporarily halt the progression of COVID-19 and are proceeding as planned.
Amidst all this uncertainty, one thing is certain: human resource professionals continue to face overwhelming obstacles. Below, we outline issues that human resource professionals are likely to face as they onboard furloughed and laid-off employees.
Onboarding Furloughed Employees
HEALTH AND WELFARE PLANS
For employees enrolled in one or more employer sponsored health and welfare plans and receiving coverage during the furlough period:
- Payroll deductions for required employee contributions for the plan generally resume upon return from furlough, subject to any changes in employment status that may affect eligibility.
- To the extent repayment of employee contributions advanced during the furlough period is required, consider how to collect the employee contributions (e.g., through payroll deduction or otherwise), keeping in mind state law requirements related to payroll deductions.
- Consider the extent to which election changes may be made upon return from furlough.
For employees not enrolled in an employer-sponsored health and welfare plan during the furlough period (or enrolled in COBRA continuation coverage):
- Determine when eligibility for the plan resumes in accordance with plan terms (e.g., immediately or after a waiting period), subject to any impact on eligibility due to changes in employment status.
- Consider the process for enrolling employees and the extent to which election changes may be made upon return from furlough, including any HIPAA special enrollment rights.
In addition:
- Evaluate the impact of the furlough on employees' full-time status under the Affordable Care Act's (ACA's) lookback measurement period and stability period requirements.
- Evaluate the impact of return from furlough on participation in wellness program activities and eligibility for wellness program incentives.
- To the extent employees will have staggered work schedules, consider entitlement to benefits based on reduced hours (full time/part time) or new job requirements and whether any plan amendments are needed.
401(K) PLANS
Generally, employee and company contributions resume upon return from furlough; however, changes in job titles or positions may affect eligibility:
- Determine whether employee and company contributions will resume immediately upon return from furlough based on elections in place immediately before the furlough period or whether new elections will be required.
- Determine the extent to which legally required notices relating to plan participation must be provided.
- Address the treatment of loan repayments upon return from furlough.
- Determine the extent to which the period of furlough must be counted for purposes of plan eligibility, vesting and the right to allocation of contributions.
PENSION PLANS
- Consider whether changes in job titles or positions may affect eligibility for continued participation upon return from furlough.
- Review plan terms to determine the extent to which the period of furlough must be counted for purposes of plan eligibility, vesting and benefit accrual.
OTHER BENEFITS
- Consider the impact of return from furlough on any commuter benefits (parking and transit).
- Consider the impact of return from furlough on vacation and holiday accrual.
Onboarding Laid-Off Employees
HEALTH AND WELFARE PLANS
- Treat rehired employees who have been laid off as new hires who must complete new hire paperwork for health and welfare plan eligibility.
- Consider the impact of the termination of employment and rehire on the employee's status as a full-time employee under the ACA's lookback measurement period and stability period requirements.
QUALIFIED RETIREMENT PLANS
- Defer to plan terms and break-in-service rules for purposes of determining the impact of the layoff on plan eligibility, vesting and benefit accrual.
- Review plan terms and procedures for enrolling rehired employees in a 401(k) plan, including application of the plan's auto-enrollment feature, if any.
SOURCE: Pepper, T. (29 July 2020) "Benefits Consideration for Onboarding Furloughed and Laid Off Employees" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/benefits-consideration-for-onboarding-furloughed-and-laid-off-employees.aspx
COVID-19 at-home testing kits can make returning to work safer
As many begin to return to the workplace, both employers and employees are fearful of bringing the COVID-19 virus into the workplace. A company has produced an at-home testing kit for those returning to work. Read this blog post to learn more.
While access to wide-spread coronavirus testing is still a barrier for millions of Americans, computer software company Appian is partnering with Everlywell, a digital health company, to offer COVID-19 at-home testing kits for employees returning to the workplace.
“Everlywell was founded to give people access to high-quality lab tests that can be taken at home,” said Julia Cheek, founder and CEO of Everlywell. “We are proud to support Appian’s customers in providing FDA-authorized COVID-19 testing to help keep them safe.”
Since March, more than 50 million coronavirus tests have been reported to the CDC, of which 5 million were positive. But as states reopen their economies and infection rates increase, there are growing concerns about supply chain problems, according to Politico. Reopening has increased demand for testing, causing samples to pile up faster than labs can analyze them, which is lengthening turnaround times for results — complicating efforts to contain the virus.
Everlywell’s at-home lab tests seek to streamline the process of testing for their employer clients. The COVID-19 test will be integrated within the Appian Workforce Safety solution. Through the partnership, people using Appian’s return-to-site solutions will be able to request home delivery of Everlywell’s COVID-19 testing kit by taking a screening questionnaire based on CDC guidelines. Each test request will be reviewed by an independent physician from Everlywell’s third-party telehealth partner. Test results can be delivered to the test-taker’s mobile device in 24-48 hours after the sample arrives at an authorized lab.
The lab tests have received emergency use authorization from the Food and Drug Administration. The testing used by the company and its lab partners meet the FDA’s performance criteria for COVID-19 test accuracy, and telehealth consultations are included for those who test positive.
“How much you know as an organization is how much you can protect the members of your organization,” says Matt Calkins, CEO of Appian. “This is the fastest way to get information on infection. We've seen that high amounts of testing can help minimize COVID-19. Knowledge is power, so we're trying to get [employers] as much knowledge as possible, as quickly as possible, and provide them with another tool to keep their employees safe.”
As employers make their strategies for returning to work, workplace safety is of top concern. Antibody screening, thermal cameras and on-site nurses are all methods being considered to help employees stay safe. Digital health is playing a major role in helping employees self-report their risks, whether that be the employee taking the subway, or living with someone who’s immunosuppressed. It can also help employers scalably monitor and assess people's symptoms on a daily basis, ensuring that sick employees stay at home and quarantine. Workplace changes may also include desks and workstations being spread further apart, and stricter limitations on large meetings and gatherings in the office.
Appian’s platform helps employers centralize and automate all the key components needed for safe returns to work. Through the platform, employers can process health screenings, return-to-site authorizations, contact tracing, isolation processing, and now, COVID-19 testing.
“A lot of people would rather work with an employer who goes the extra mile, who’s willing to offer and pay for tests if necessary for their own employees, and to quickly deploy it, where there’s even a suspicion of transmission,” Calkins says. “It’s a responsible gesture and a serious signal that the employer cares about the health of their workforce, and employees are reassured that their colleagues are more likely to be healthy.”
SOURCE: Nedlund, E. (30 July 2020) "COVID-19 at-home testing kits can make returning to work safer" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/covid-19-at-home-testing-kits-can-make-returning-to-work-safer
Why continuous listening is the key to a smooth transition back to work
Returning to the workplace during this time can be difficult for many, especially with employers who are being faced with the question of how to create and keep a safe and comfortable workplace scene. Read this blog post to learn more.
As states and businesses reopen in the U.S., many employers are faced with a difficult decision: Should their employees go back to the workplace? And if so, when? Amazon told their workers they likely wouldn’t return until October, while Google announced that their employees wouldn’t go back to the office until 2021. Twitter and Facebook decided most employees could work from home forever.
But once employers do make that decision, they’re then confronted with a more formidable one: How do they get their employees back in a way that is both safe and comfortable for everyone? In short, how do they successfully manage employee experience?
Most companies have coordinated COVID-19 task forces charged with making those decisions and helping their employees navigate the global pandemic. And whether they realize it or not, those task forces are broken down into two different functions: operational and experiential.
When COVID-19 first hit, the task forces had to deal with the operational challenge of moving massive workforces home overnight, and they worked to ensure employees had the equipment and software needed to function remotely. And soon after, many realized they also had another responsibility on their plate: employee mental wellbeing.
Leaders recognized they’d have to find new ways to keep their people sharp, productive, and happy. In fact, their employees’ experience with remote work was a central component in making that big operational move successful.
The same will happen as task forces bring people back to the workplace. In fact, managing employee experience will become a task force’s most critical responsibility. To ensure employees feel comfortable returning to the workplace, company leadership needs to know how they feel about coming back and what safety concerns they may have. Then leadership must act on that information.
But the current situation (and their employees’ feelings) can change rapidly. That’s why a method called “continuous listening” is essential to managing employee experience. At least once a day (if not more), employees should be able to respond to a few questions about how they’re feeling, and leaders can use that real-time information to successfully take care of their teams.
A large retail bank in North America has set up an always-on feedback channel for retail branch employees to identify safety concerns in different branches. The bank recognized that, when it came to health and safety concerns, employees might need to offer feedback immediately rather than waiting for a survey that came around once a day. Other organizations have used pre-screening tools that allow employees to self-report each day so company leadership can decide whether they should come into the workplace.
Continuous listening helps leadership communicate with employees, and vice versa. If there’s ever been a time to listen to your people and manage their employee experience, it’s now.
A Qualtrics study conducted at the beginning of May found that two out of three workers in the United States didn’t feel comfortable returning to the workplace. In fact, nearly half of all workers said they didn’t expect to go back to work until August or later.
Most respondents said they want assurance from public officials like the Centers for Disease Control or state and local governments before returning, while about half said they’d feel more comfortable once a treatment or vaccine is available. Nearly 70%, though, said they trust their company leadership to make the right decision on when to come back.
Once leadership makes that decision, however, employees expect them to enact policies and procedures that will protect workers’ safety. Almost 75% said they want their work facility to be thoroughly and regularly cleaned and disinfected, while 62% said they want strict policies about who cannot come to the office, including those who are sick and have recently traveled. Nearly 60% said they want masks available to everyone who wants one, while the same amount said they want all employees to be required to wear a mask at all times.
A majority expect their company to require those who travel to self-quarantine for 14 days, prohibit handshakes and hugs, and set safety measures around communal food. Almost 40% said they want employees to be brought back in phases instead of all at once.
Employees also want the freedom to take action themselves. Over 60% said they want to be able to wear a mask and maintain social distancing at work, and half said they want more flexible sick-leave policies that employees are encouraged to use, even with minor symptoms. Nearly the same amount said they want to be able to limit the number of people they’re exposed to in workplace meetings, and almost 40% said they want to be able to skip work without penalty or continue working from home if they feel unsafe.
These findings provide companies with a general idea of what their employees want to see before coming back to work, but gathering data specific to each organization is even more helpful. Before and after companies begin their initial return, they’ll need to listen closely and continuously to their employees and should increase emphasis on employee feedback.
After all, employees are an organization’s best ambassadors. Invest in them, and they’ll invest in you.
SOURCE: Choi, J. (27 July 2020) "Why continuous listening is the key to a smooth transition back to work" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/opinion/why-continuous-listening-is-the-key-to-a-smooth-transition-back-to-work
Benefits fair cancelled? 6 strategies for remote benefits communication
Even as states begin to reopen from COVID-19-related closures and many employees return to their places of work, employers can’t rely on past approaches to communicate benefits information during open enrollment and to educate employees about their benefits. It’s unlikely that employers will be hosting large events like benefits fairs, a staple of open enrollment in past years, soon. In addition, some employees may continue to work remotely for an extended period, which means in-person benefits communication can’t be the only strategy.
Employers can consider several alternatives to craft an open enrollment and benefits education and engagement strategy that addresses these issues. For many employers, the solution will be to combine several of these approaches to ensure they are effectively communicating important benefits information and providing employees with more than one way to learn about their benefits and get answers to any questions that may arise.
Before developing a strategy, consider surveying employees to find out how they would prefer to receive information about benefits. Some people find email or printed materials effective, others prefer videos or interactive webinars, while others may be more responsive to receiving information via text message. Once you know your employees’ preferences, you can tailor your approach to increase the likelihood that your employees will use the tools you provide and have a positive experience.
- Recast your benefits fair as a virtual event. If you want to gather employees together and explain benefit options, how the open enrollment process will work this year and provide them with the opportunity to interact with benefit vendors, you could create a virtual event modelled on the in-person benefits fair. Depending on your organization’s size, the number of employees you need to reach, and where they are located (for example office employees, warehouse or field employees, and remote employees), your approach to hosting a virtual benefits fair will vary. A growing number of IT service vendors offer virtual event planning and execution services that include setting up the technology needed to conduct the event, handling invitations and registrations of participants, working with benefits vendors to set up virtual booths and arranging educational webinars as part of the event.
- Use your employee intranet, portal, or app. Regardless of whether you host a virtual event, you can use your employee website, portal or app and upload all the informational and educational material employees will need to make benefit choices. This approach can also include a secure portal that employees use to complete benefits forms. Another good feature to include is a chat, which can be either live chat or a chatbot, where employees can get answers to frequently asked questions and assistance with completing open enrollment forms.
- Host webinars. Webinars not only give you the ability to communicate information about benefits, they also give employees the chance to directly ask the HR and Benefits team questions. In addition to the live webinar, you can record the event and post it on your organization’s employee site or send a link via email so that employees who were not able to attend can still hear your message firsthand.
- Mail printed materials home. Some employees still prefer to receive benefits and enrollment information and forms in a printed format. It can provide a resource that they can easily refer back to when making their benefits sign up decision. Mailing these materials to employees’ home addresses rather than using your business address ensures that all employees, those who have returned onsite and those who are working remotely, have access to the information they need.
- Use texts and calendar reminders. To help employees stay on top of enrollment deadlines, send text messages and add reminders to their work calendars. Text messages can also be used to send links to more in depth information resources so employees can access information when required.
- One-on-one support is key. Employees are bound to have more complicated or confidential questions about their benefits choices, e.g. the need for information about coverage for cancer treatment or labor and delivery. Providing one-on-one phone and chat support from the HR and Benefits team gives employees a way to get answers to questions they don’t want to ask in a more public forum such as a webinar.
A benefits plan is only valuable if employees are knowledgeable about what benefits they have and how to access them. Many of these approaches can also be used on an ongoing basis to provide education on and drive engagement with benefits so employees and employers both get the most out of their plans.
SOURCE: Varn, M. (27 July 2020) "Benefits fair cancelled? 6 strategies for remote benefits communication" (Web Blog Post). Retrieved from https://www.benefitnews.com/opinion/benefits-fair-cancelled-6-strategies-for-remote-benefits-communication
Jobs are being wiped out at airlines, and there’s worse to come
About 400,000 airline workers have been fired, furloughed or told they may lose their jobs due to the coronavirus, according to Bloomberg calculations.
The aviation industry has suffered more than most as the pandemic destroys ticket sales and strips companies of cash. Airlines the world over have drastically cut back on flights due to border restrictions and a lack of appetite for travel, particularly internationally, because people are worried about contracting the virus and spending lengthy periods in quarantine.
British Airways, Deutsche Lufthansa AG, Emirates Airline and Qantas Airways are among the carriers announcing thousands of dismissals and unpaid leave programs. Many more are expected in the U.S. after a ban on job cuts 一 a condition of a $50 billion government bailout 一 is lifted at the end of September. Delta Air Lines, United Airlines and American Airlines have already warned about 35,000 employees that their jobs are at risk. The trio’s combined personnel losses could top 100,000 by year-end.
Even the pilots and cabin crew who manage to keep their jobs are, in general, facing salary cuts.
The 400,000 job-loss figure is for airlines worldwide and covers pilots and cabin crew, who have found themselves on the front lines of the virus fight when they are at work. It includes planned cuts by U.S. carriers and was compiled from company statements, Bloomberg News stories and other media reports.
Job losses in related industries including aircraft manufacturers, engine makers, airports and travel agencies could reach 25 million, according to the International Air Transport Association. The hotels and lodging sector in the U.S. sees 7.5 jobs lost for every one in aviation. Airbus and Boeing are cutting more than 30,000 positions.
SOURCE: Kotoky, A.; Modi, M.; Turner, M. (24 July 2020) "Jobs are being wiped out at airlines, and there’s worse to come" (Web Blog Post). Retrieved from https://www.benefitnews.com/articles/jobs-are-being-wiped-out-at-airlines-and-theres-worse-to-come
‘It’s a fool’s choice’ when employers ignore investments in mental health benefits
Many employers have realized that the coronavirus pandemic has effected their employee's mental health tremendously. Many are now looking into opportunities to innovate change in the way mental health is viewed. Read this blog post to learn more.
As more states reopen and the return to work process gets underway, employers are grappling with how to address the rising mental health issues that have resulted from the COVID-19 pandemic.
The Society for Human Resource Management Foundation, One Mind at Work, and Psych Hub have partnered together to launch Mental Health and Wellness in the Workplace, an initiative to engage HR professionals in education and training opportunities to lead changes in the way mental health and wellness are viewed in the workplace.
“Our focus is on helping HR professionals and managers lead positive social change in the workforce,” says Wendi Safstrom, executive director of the SHRM Foundation. “We think it's critical to help employers and employees manage significant mental health tools related to COVID-19, and even beyond as companies begin to reopen.”
Mental health has been a growing concern among workers as the pandemic has worn on. About 41% of employees feel burnt out, drained, or exhausted from their work, according to data from SHRM. Additionally, nearly one in four employees report frequently feeling down, depressed, or hopeless — yet more than one in three employees reported having done nothing to cope with these feelings.
The SHRM Foundation, One Mind and Psych Hub initiative provides employers and HR professionals with a workplace wellness resource center, as well as training resources to help them address and improve mental health issues among employees.
The training covers topics like promoting workplace wellness, managing mental health during a crisis, and becoming an “agent of change” for workplace mental health.
Providing wide-spread education on mental health ensures that the diverse needs of employees have the opportunity to be met.
“What we're saying to everyone is that you cannot be autocratic here — this is about empathy,” says Garen Staglin, chairman of OneMind and co-founder of OneMind at Work. “You can't mandate that people are going to feel okay just because you tell them it's okay.”
Each member of the alliance brings a particular expertise in their respective practice areas. The SHRM Foundation focuses on workplace social change, One Mind at Work focuses on best practices and tools for brain health in the workplace, and Psych Hub focuses on multimedia learning solutions to mental health and addiction.
The materials are available to all companies and HR professionals via the Psychhub website. Employers, HR, and staff will have access to articles and other content on a variety of mental health subjects.
Investing in this program will not only help employees as they’re struggling now, but ensure investment into their future.
“We did a study that said for every dollar you invest in accelerating workplace best practices for mental health, you'll get a $3 to $5 return in the form of lower absenteeism, improved productivity, better customer service, and lower workers comp claims,” Staglin says. “It's a fool's choice to ignore brain health and workplace mental health, because the costs are extremely high.”
SOURCE: Schiavo, A. (23 July 2020) "‘It’s a fool’s choice’ when employers ignore investments in mental health benefits" (Web Blog Post). Retrieved from employeebenefitadviser.com/news/its-a-fools-choice-when-employers-ignore-invest-in-mental-health-benefits
When Should Managers Call HR?
When one thinks of contacting the HR department, it's often associated with filing a complaint or discussing a workplace issue that is in need of a resolution. There are often more reasons as to why the HR department needs to be contacted. Read this blog post to learn more.
Employers expect supervisors to resolve some issues on their own and to report other things to human resources—or possibly to in-house counsel—rather than to resolve them independently.
But do you know which is which? For example, you probably know that you should report to HR all complaints of unlawful discrimination, harassment or retaliation, even if:
- The employee requests that the complaint be kept confidential.
- The employee implores the supervisor not to consult with HR.
- The complaint appears to lack merit.
But in other instances, the line is less clear. For example, if an employee is frequently late, it's your job to resolve the issue by confronting the employee about his lateness and handling it according to established company policies. But what happens if the chronically tardy employee responds by saying that he has been late because of chemotherapy appointments? That's the kind of information you need to report to HR so a determination can be made about whether a work accommodation is appropriate.
Here are some other clarifications of when to report in suspect categories:
WAGE COMPLAINTS
An employee complaint about not being paid as much as he deserves usually is an employee relations issue, not a legal issue. But when an employee complains that the employer has failed to pay him for time worked or has made improper deductions from his pay, savvy supervisors will see legal red flags. For nonexempt employees, improper deductions may include things like not paying for short breaks. For exempt employees, improper deductions may include deductions inconsistent with the salary basis requirement of the overtime regulations of the Fair Labor Standards Act (FLSA), such as not paying an exempt employee for a holiday when the employer is closed.
By immediately reporting a wage complaint to HR, you let the organization determine whether the complaint has merit. If no money is owed or no improper deductions made, HR can correct—or at least try to correct—the employee's misunderstanding. On the other hand, if there was a mistake, HR can correct it before the employee files a complaint with an administrative agency or court. This should go a long way toward minimizing the employer's exposure to liquidated damages for willful violations of the FLSA, and it also may mitigate an employer's liability under state wage and hour laws, whose requirements and penalties are often more stringent than federal law.
Remember, you must report even minor wage claims. A single employee's small wage loss may signal a systemic problem affecting other employees—in other words, a class action waiting to be born.
ALLEGATIONS OF WRONGDOING BY OTHERS
More and more employees are "blowing the whistle" on alleged wrongs that may not directly affect their terms and conditions of employment—alleged corporate fraud, for example. Managers should report immediately complaints of criminal or fraudulent activity, or violations of statutes such as the Sarbanes-Oxley Act. You also should report alleged violations of core employer policies that may have material legal and business consequences, such as conflict of interest policies, business ethics standards or codes of conduct.
DISCLOSURE OF MEDICAL INFORMATION
Any disclosure of a serious health condition or a physical or mental impairment by a job applicant or employee should be reported to HR—even if the applicant or employee doesn't specifically seek an accommodation. During interviews, you may ask applicants whether they can perform the essential functions of the job for which they have applied—but you may not pursue any medical inquires before making a conditional offer of employment. Likewise, where a current employee's performance or behavior is below standard, managers need to focus on the deficiencies—and not inquire or speculate as to any suspected medical reason that may underlie them.
But what if an applicant says that he cannot perform a particular function because of clinical depression, or an employee acknowledges her performance deficiencies but says that lethargy resulting from her heart condition has caused them? In these cases, even though there was no direct request, the disclosure puts the employer on notice that the applicant or employee may need an accommodation. Accordingly, the employer—that is, HR and not you—may need to begin the interactive process to determine whether a reasonable accommodation is needed.
ACCOMMODATION OR LEAVE REQUESTS
An applicant or employee need not use the legal words "Americans with Disabilities Act (ADA) accommodation" or "Family and Medical Leave Act (FMLA)" to trigger statutory rights. The key is whether a reasonable supervisor would recognize the individual's communication as a request for an accommodation or a leave of absence. With regard to accommodations, for example, you should report requests for help, support, job changes, etc. if the employee—contemporaneously or previously—has disclosed the existence of a serious health condition or impairment.
As for leave, report requests for "time off" for medical or other potential FMLA situations, even if the employee does not utter "FMLA." Even if the employee clearly is not eligible for FMLA leave, you need to report a request for time off because a leave could be a reasonable accommodation under the ADA regardless of FMLA eligibility.
EVIDENCE OF UNION ACTIVITY
If 30 percent of eligible employees in an appropriate bargaining unit sign union authorization cards, the union can petition the National Labor Relations Board for an election. Even if an employer wins the election, the victory can be very costly. The key to avoiding elections is early detection of and rapid response to union activity. But employers often begin their counteroffensive only after the union has obtained the 30 percent showing of interest. Sometimes, this is because supervisors fail to report to HR what they may see as "isolated" signs of union support. A bundle of isolated, minor occurrences may amount to evidence of a serious union campaign.
Direct signs of union activity would include an employee handing out a union flier in the parking lot or wearing a pro-union T-shirt. Indirect warning signs would include unusual off-site gatherings of employees—at barbecues, bowling alleys and bars. You also need to be aware of the restrictions on your behavior under the National Labor Relations Act. Supervisors cannot:
- Spy on employees to see who may be engaging in union activity.
- Promise employees benefits for refraining from union activity.
- Interrogate employees as to whether they or others are engaging in union activity.
- Threaten or take adverse action against employees for engaging in union activity.
While you cannot spy, you can report what you see in plain view. And while you cannot interrogate employees about their union sympathies, you can report what is volunteered or what you inadvertently overhear.
GOVERNMENT COMMUNICATIONS
Inform HR immediately if you receive any communication from a government agency, official or entity, including everything ranging from a charge of discrimination filed with the EEOC or other agency to an on-site visit from a U.S. Department of Labor investigator asking to review certain files in connection with alleged overtime pay violations of the FLSA. It's not your duty to decide whether and to what degree to cooperate. Sometimes, government officials ask for more than they are entitled to have. And even where they have a legal right to the requested information, the manner in which the employer communicates can determine the legal outcome and damages that may flow from it. If an official contacts you by phone, be polite and say, "Our organization/company will cooperate with your request; however, I do not have the authority to respond. Let me give you the name and telephone number of the HR professional with whom you should speak. I also am going to contact HR right now."
LAWYER COMMUNICATIONS
Report immediately—and don't respond—to any subpoenas or letters from lawyers who do not represent the employer. In case of "friendly calls" from lawyers who are "just curious" about a few things, don't provide any information. There is no duty to cooperate with an attorney on a fishing expedition. Instead, say something like this: "I do not have authority to talk with you. Please give me your name and number and I will forward them to HR."
SIGNS OF WORKPLACE VIOLENCE.
Not all workplace violence is preventable. But sometimes there are warning signs that supervisors need to report to HR and/or security immediately, including:
- Discussions of or particular fascination with perpetrators or victims of violence.
- Talk of weapons that seems abnormal in frequency or content.
- Statements about hearing voices or receiving signals.
- Threats of suicide.
SOURCE: Segal, J. (21 July 2020) "When Should Managers Call HR?" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/people-managers/pages/when-should-managers-call-hr.aspx
Employees Look to HR to Evaluate COVID-19 Data Before Reopening
Many employers are looking at the opportunity to allow employees to return to their workplace, but before returning many are asking and reaching out to their HR departments to look and rely on local, state, and federal data in order to make a safe transition back into office. Read this blog post to learn more.
When national staffing and recruitment firm Addison Group began putting in place the necessary measures to reopen the company's offices in Texas, Peg Buchenroth, senior vice president of human resources, relied on local, state and federal data to make the transition.
The company's employees switched to remote work during the week of March 16. Since then, Buchenroth and her colleagues have been monitoring coronavirus cases in Texas, where the numbers are changing fast.
Recent data from Texas health authorities demonstrates why it's important for human resource managers to follow infection and hospitalization rates in different geographies.
According to Texas Department of State Health Services data, nearly 75,000 people tested positive for the coronavirus in the first week of June and more than 1,800 people died of COVID-19. As of July 19, nearly 4,000 people had died from COVID-19 in the state, and the death toll is expected to rise further as reported cases have climbed to over 330,000.
Texas Health and Human Services has posted a warning on its website: "Please note that all data are provisional and subject to change. Probable cases are not included in the total case numbers."
Texas Gov. Greg Abbott began clearing the way for businesses to reopen in May to restart the state's economy but had to roll back those plans after COVID-19 deaths began to rise. In the midst of this, the Addison Group reopened its San Antonio/Houston offices on May 4, its Dallas location on May 18 and its Austin facility on May 20. The company closed its Texas offices for the July 4 holiday and has kept them closed as it considers what to do next.
"While we successfully opened our Texas offices in May for employees who wanted to return to in-person work, we've decided to close these locations and will monitor the situation in case we need to reassess," Buchenroth said. "The safety of our employees remains Addison Group's top priority, and we will continue to leverage federal, state and local data to inform any future decisions."
She said employees who return to the office will need to adhere to Centers for Disease Control and Prevention guidelines, such as wearing a mask and maintaining 6 feet of physical distance from others.
"We want to make sure that employees feel safe when they return to the office," Buchenroth said.
She added that the company takes into consideration the many factors that can influence an employee's decision to return to the office, including child care needs, elder care responsibilities, and serious underlying medical conditions that put individuals at high risk of developing a severe illness from COVID-19.
Coronavirus and COVID-19
Using Data to Inform Reopening
As more businesses reopen, employers will have to decide if going to the office is safe based on the data received from local health authorities. Insight from that data will determine how employers will design their workspaces to allow for adequate social distancing within an office, how many workers will be allowed in the office at a time and whether remote work will continue for the foreseeable future.
John Dooney, an HR Knowledge Advisor at the Society for Human Resource Management, said he has noticed an increase in the number of inquiries from HR professionals about new federal, state and local measures and how to safely reopen businesses. He added that while health officials have gained a better understanding of the coronavirus during the past four months, there is still a lot more to learn.
"The pandemic is evolving, and we haven't had the luxury of time to get the information we need," Dooney said. "I think it's important for HR managers to continually review data from authoritative resources."
HR needs to be aware of the changes states are making as they reverse previous decisions on reopening their economies given increasing coronavirus infections and death rates in states like Arizona, Florida and Texas. The current crisis, Dooney said, should prompt HR professionals to be more involved with their senior leadership teams in the decision-making process.
"HR executives should work with senior managers to come up with the best ideas that protect their employees," Dooney advised. "The leadership team should be looking at not only how to maintain the business, but also how to implement adequate protections."
Employers' responses will also depend on the work environment at each company. Hospitals, supermarkets, pharmacies and delivery services, for example, need employees at their worksites; many knowledge-based businesses, however, are better-suited to rely on remote workers.
Gavin Morton, head of people and financial operations at HR.com, said as discrepancies arise in the actual number of coronavirus infections and deaths caused by COVID-19, employees will want to know that their employers have seen the data, considered it carefully and are concerned about workers' safety.
"We all want to know exactly what's going on, but it is very difficult for medical professionals and coroners to quickly ascribe deaths to COVID-19 or other causes," Morton said. "It is logical that there are both more cases and more infections than are being reported, since the testing numbers are still relatively low, and we may not know for years what the true impact has been."
Morton added that employers are in a powerful position to reduce their employees' anxiety. "Employers need to read carefully to understand what the reliable facts are and use them to inform their employees rather than alarm them. Clarity, calm and honesty go a long way," he said.
Morton said HR professionals should consider and educate the leadership team in two key areas:
- How this information impacts the business and employees. Some data could have little to no impact on a company, depending on such factors as location and type of business, while other information could have a severe impact. An outbreak of cases in a city four hours away may not worry the organization's local employees, but if someone's parents live in that city, he or she may be personally very concerned.
- Employee sentiment. It is critical to understand how employees are feeling and how new data can affect their confidence in their safety.
Contact tracing, new coronavirus cases, new hospitalizations, and increases or drops in the number of people dying from COVID-19 will be critical data that will contribute to HR managers' planning.
Human resource professionals should remember, too, that the data are interrelated.
For example, Morton noted that while an increase in deaths reported is alarming, it doesn't necessarily mean that there are more cases; similarly, falling death rates may not mean that transmission today is low. Information about deaths is only one piece of the puzzle.
Developing measures to secure the safety and encourage the performance of employees during the second half of the year won't be easy, especially if there is suspicion that federal, state and local information on the COVID-19 crisis isn't accurate.
"The numbers are really important, and companies need to pay close attention to information which impacts their employees and their customers," Morton said. "While the data can help guide their decisions, HR leaders and company leaders still need to interpret the data. This is true for any information, and so the uncertainty around death reporting is no different. Company leaders need to use their best judgment based on their knowledge of their business, employees and customers."
SOURCE: Lewis, N. (20 July 2020) "Employees Look to HR to Evaluate COVID-19 Data Before Reopening" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/technology/pages/hr-evaluate-covid19-data-before-reopening.aspx
Overview of COVID-19 Law and Guidance for Health and Welfare Plans
The business operations of many small and large companies have been significantly affected due to the coronavirus pandemic. During this time, health and benefit plans are also being affected. Read this blog post to learn more.
The COVID-19 pandemic has significantly affected the business operations of small and large employers alike. To mitigate the harm from the pandemic to employers, the government has enacted major legislation and issued numerous guidance in the past few months pertaining to COVID-19, including rules that address various aspects of employee benefits.
This article provides an overview of significant COVID-19 legislation and guidance related to employer-sponsored health and welfare benefit plans that has been enacted or issued to date.
Some of these changes are mandatory for group health plans. Other are optional. Employers should carefully review these rules to determine any compliance obligations as well as any opportunities to benefit their businesses and respective employees.
Mandated Coverage of COVID-19 Testing (Mandatory)
Effective March 18, 2020 and until the end of the national emergency period for COVID-19, the Families First Coronavirus Response Act (FFCRA) requires group health plans to cover:
- COVID-19 diagnostic testing.
- Certain items and services that result in an order for, or administration of, the testing.
Plans must provide this coverage without imposing any requirements for cost-sharing, prior authorization, or medical management.
CARES ACT
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which was signed into law on March 27, 2020, amended the FFCRA's coverage mandate to:
- Expand the scope of COVID-19 diagnostic tests that must be covered.
- Include rules regarding the rate at which a plan must reimburse a health care provider for the mandated services.
- Require coverage of preventive services and vaccines for COVID-19 as of 15 days after such a service or vaccine is given an "A" or "B" rating in a recommendation by the U.S. Centers for Disease Control and Prevention (CDC) or U.S. Preventive Services Task Force.
ADDITIONAL GUIDANCE
On April 11, 2020, the FFCRA and CARES Act FAQs provided additional information about this COVID-19 mandate. Items included details on required coverage of COVID-19 antibody tests, rules regarding required disclosures of the new coverage to plan participants, and which items and services related to COVID-19 testing must be covered by a plan.
Continuation of Health Benefits During Certain Leaves of Absence (Mandatory)
The FFCRA also requires (with some exceptions) employers with fewer than 500 employees to provide certain paid sick leave and family and medical leave related to certain COVID-19 reasons, as follows:
- Paid sick leave. An applicable employer must provide two weeks of emergency paid sick leave (EPSL) to an employee who is unable to work (or telework) due to certain reasons related to COVID-19. Reasons include quarantining of an employee (due to a Federal, state or local order or advice from a health care provider) experiencing COVID-19 symptoms, caring for an individual who is quarantined, and caring for a child under age 18 whose school or child care provider is closed.
- Family and medical leave. The employer must also provide up to twelve weeks of expanded Family Medical and Leave Act (FMLA) leave (ten of which is paid) for an employee who has been employed for at least 30 days and who is unable to work (or telework) due to a bona fide need for leave to care for a child whose school or child care provider is closed or unavailable for reasons related to COVID-19.
During FMLA leave, an employer is required to allow the employee to continue his or her group health coverage at the same premium rate as that of active employees. The DOL has also issued FAQs stating that employers must continue employees' coverage during EPSL, as well. Note, there are also implications for retirement plans under the FFCRA and CARES Act. Although those retirement plan rules are not discussed in this article, some of the CARES Act rules are conceptually similar for retirement plans (e.g., 401(k) plans may allow participants to take "Coronavirus-related" 401(k) plan distributions due to certain COVID-19 reasons).
High-Deductible Health Plans and Health Savings Accounts (Optional)
IRS GUIDANCE
IRS Notice 2020-15 (March 11, 2020), which was issued prior to passage of the FFCRA and CARES Act, provided that a high-deductible health plan (HDHP) will not lose its HDHP status if it covers COVID-19 testing and treatment before the statutory minimum HDHP deductible is met. Therefore, the plan can cover those COVID-19 related services without causing participants to be ineligible to contribute to a health savings account (HSA). IRS Notice 2020-29 (May 12, 2020) clarified that the provisions in Notice 2020-15 apply to an HDHP's reimbursement of expenses incurred on and after January 1, 2020.
CARES ACT
The CARES Act amended the HSA rules to provide that, for plan years before December 31, 2021, an HDHP does not lose its HSA-eligible status if it covers telehealth and other remote healthcare services before the HDHP deductible is met. This CARES Act provision is broader than the IRS Notices, as it provides that an HDHP can cover telehealth services regardless of whether the services are related to COVID-19. The CARES Act also allows participants to use their HSAs, health flexible spending accounts (FSAs), and health reimbursement arrangements (HRAs) to pay for certain over-the-counter drugs without a prescription as well as certain menstrual care products.
Extended Form 5500 Filing Deadline for Certain Plans (Optional)
IRS Notice 2020-23 (April 9, 2020) extended certain deadlines for a plan to file the required annual Form 5500. Under Notice 2020-23, the Form 5500 deadline was extended to July 15, 2020 for any plan whose plan year ended in September, October, or November 2019 (or any plan that was given a filing extension between April 1 and July 15, 2020). Ordinarily, a plan must file its Form 5500 (absent an extension) by the last day of the seventh month following the end of the plan year.
Relief for Certain Disclosures Required by ERISA (Optional)
EBSA Disaster Relief Notice 2020-01, which was issued by the DOL on April 28, 2020, extended the deadlines for plans to provide certain notices and disclosures under Title I of the Employee Retirement Income Security Act of 1974 (ERISA). Under Notice 2020-01, a plan will not be treated as violating ERISA if it fails to timely furnish a notice, disclosure, or document required by Title I of ERISA between March 1, 2020 and 60 days after the announced end of the national emergency declaration for COVID-19. The plan fiduciary, however, must act in good faith to furnish the notice, disclosure, or document as soon as administratively practicable. For this purpose, a plan fiduciary can meet the "good faith" standard by furnishing a document electronically if it reasonably believes that the recipient has access to electronic communication.
Extensions of Certain Plan Deadlines (Mandatory)
A joint notice issued by the DOL and IRS (published May 4, 2020) required group health plans to extend certain timeframes for participants during the "outbreak period" (defined as the period from March 1, 2020 until 60 days after the announced end of the national emergency for COVID-19). Those plans are required to disregard the outbreak period for purposes of determining the following periods and dates:
- The 30-day/60-day special enrollment period under the Health Insurance Portability and Accountability Act (HIPAA).
- The 60-day deadline for a qualified beneficiary to elect continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).
- The deadlines for a COBRA qualified beneficiary to pay his or her required COBRA premiums.
- The deadline for an individual to notify the plan of COBRA certain qualifying events (e.g., divorce).
- The deadlines for a participant to file benefit claims, appeals, and external review requests with the plan (or to perfect an external review request).
Because of this joint notice, a group health plan must essentially "pause" the above deadlines during the outbreak period. For example, if an individual experienced a COBRA qualifying event on March 1, 2020, the individual would have until 60 days after the end of the outbreak period (rather than 60 days after March 1) to elect COBRA coverage. This is because the joint notice requires a group health plan to pause the 60-day timeframe for COBRA elections during the outbreak period. Also, because the joint notice was issued on May 4 and is retroactive to March 1, plans may be required to re-process previous claim denials that were based on a participant's failure to meet one of the above deadlines between March 1 and May 4.
Cafeteria Plans and Flexible Spending Accounts (Optional)
2020 MIDYEAR ELECTION CHANGES
IRS Notice 2020-29 (May 12, 2020) relaxed the rules regarding cafeteria plan pre-tax elections in light of the COVID-19 pandemic. Under Notice 2020-20, employers may (but are not required to) amend their cafeteria plans to allow participants to make the following mid-year, pre-tax election changes in 2020:
- An election to enroll in the health plan by an eligible employee who previously declined coverage (e.g., someone who waived coverage during open enrollment).
- An election to change plan options (e.g., from an HMO to a PPO) or add dependents.
- An election to drop coverage by a participant.
- An election to enroll in or drop health FSA or dependent care FSA coverage or to increase or decrease health FSA or dependent care FSA contributions.
An employer that wishes to adopt any of all of the above cafeteria plan changes must disclose the changes to employees and amend its cafeteria plan by no later than Dec. 31, 2020 (i.e., an amendment is not required in advance of making the changes).
EXTENDED GRACE PERIOD TO INCUR FSA CLAIMS AND INCREASE OF MAXIMUM HEALTH FSA CARRYOVER AMOUNT
Notice 2020-29 also permits employers to amend their health and dependent care FSAs to allow employees to incur eligible claims through the end of the 2020 calendar year for any FSA plan year (or for any FSA grace period that ends in 2020). For example, if a health FSA has a grace period until March 15, 2020 for a participant to incur eligible claims for the 2019 plan year, the FSA can allow participants to incur expenses through 2020 and use their 2019 elections to pay for those expenses.
This change does not apply to FSAs with a carryover provision. IRS Notice 2020-33 (May 14, 2020), however, provides for a permanent FSA carryover increase based upon annual indexing. For the 2020 plan year, employers may amend a cafeteria plan with carryover provision to allow participants to carry over up to $550 in unused health account balances in the 2021 plan year. An employer that adopts the extended FSA grace periods or the increased carryover limit must amend its cafeteria plan or FSA (as applicable) by no later than December 31, 2021.
Tax-Free Payment of Employees' Student Loans (Optional)
The CARES Act amended Section 127 of the Internal Revenue Code (education assistance programs) to permit employers to pay up to $5,250 of an employee's student loans on a tax-free basis. This provision applies from the date of enactment of the CARES Act (March 27, 2020) through the end of 2020. The payment must be for either the principal or interest of a qualifying education loan incurred by the employee, and the employer can make payment either directly to the lender or as a reimbursement to the employee.
Takeaways for Employers
As employers grapple with the impact of the COVID-19 pandemic and return to normal business operations, it is important for them to be aware of their compliance obligations under the FFCRA, CARES Act and other guidance issued by governmental agencies. Employers should also carefully review the guidance and legislation for potential avenues of benefit for their business and employees.
Additional guidance for both mandatory and optional items is likely forthcoming as well, and COVID-19 continues to have a major impact on both companies and individuals as new infections spike in numerous states. Accordingly, employers would be well-advised to keep a close eye out for new legislation and guidance in the coming months and periodically evaluate their benefits programs for compliance and competitive considerations.
SOURCE Tyler Hall, A.; Schillinger, E. (16 July 2020) "Overview of COVID-19 Law and Guidance for Health and Welfare Plans" (Web Blog Post). Retrieved from https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/overview-of-covid-19-legislation-and-guidance-for-benefits-plans.aspx
The Saxon Advisor - July 2020
Compliance Check
what you need to know
SF HSCO Expenditures. The last day to submit SF HSCO expenditures, if applicable*, for Q2 is July 30, 2020. *Applicable for employers with 20+ employees doing business in SF and Non-Profits with 50+ employees.
Form 5500 and Form 5558. The deadline for the 2019 plan year’s Form 5500 and Form 5558 is July 31, 2020 (unless otherwise extended by Form 5558 or automatically with an extended corporate income tax return).
Form 8955-SSA. Unless extended by Form 5558, Form 8955-SSA and the terminated vested participant statements for the plan year of 2019 are due July 31, 2020.
Form 5558. Unless there is an automatic extension due to corporate income tax returns, a single Form 5558 and 8955-SSA is due by 2½ months for the 2019 plan year.
Form 5330. For failed ADP/ACP tests regarding excise tax, Form 5330 must be filed by July 31, 2020.
401(k) Plans. For ADP/ACP testing, the recommended Interim is due August 1, 2020.
COVID and the ADA and EEOC
Join us for this interactive and educational Saxon U seminar with Pandy Pridemore, The Human Resources USA, LLC, as we discuss COVID and the Americans with Disabilities Act (ADA) and Equal Employment Opportunity Commission (EEOC).
Medicare 101: A Quick Guide For Employers
Bringing the knowledge of our in-house advisors right to you...
Medicare is a government-funded health insurance program for those aged 65 and above, those under 65 with certain disabilities, and those with End State Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS). Employers that offer group health insurance plans to their employees have an interest in learning how employees’ entitlement to Medicare benefits can affect the administration of those plans.
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Fresh Brew Featuring Saxon's Holiday Favorites
In celebration of Independence Day this past month, the Saxon crew has decided to share one of our favorite summer recipes for this month’s Fresh Brew! We hope you all have a safe and happy holiday!
This Month's #CommunityStrong:Each member of Saxon will be choosing their own charity that they want to make a positive impact on!
This May, June & July, the Saxon team and their families will be choosing their own charity that they would like to make a positive impact towards!
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Monthly compliance alerts, educational articles and events
- courtesy of Saxon Financial Advisors.
