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HR Compliance Update
The HR Compliance Update is provided by KPA partner, Ford & Harrison LLC, a labor and employment law firms with a national practice in all aspects of labor and employment law, providing HR advice to HotlinkHR™ clients. http://www.fordharrison.com/ COBRA Premium Subsidiary ExtendedThe Department of Labor ("DOL") has recently published a series of updated model COBRA notice packages designed to assist employers and group health plans to properly provide notice to employees concerning the availability of the COBRA continuation coverage premium subsidy (now available through March 31, 2010). Enacted on March 2, 2010, the Temporary Extension Act ("TEA") extended eligibility for the 65%, 15-month COBRA premium subsidy to employees that are involuntarily terminated through March 31, 2010. The TEA also amended the definition of assistance- eligible individuals to include individuals that experience a loss in group health plan coverage due to a reduction in work hours, and are subsequently involuntarily terminated from employment. In response to the TEA, the DOL updated two of its existing model COBRA notices and published several new model COBRA notices. The following updated and new model COBRA notices are available for download from the DOL website that is dedicated to COBRA and the COBRA premium subsidy: http://www.dol.gov/ebsa/COBRA.html. It is highly likely that the COBRA premium subsidy will be further extended and that the DOL will then have to release another set of updated model COBRA notices. Employers should monitor the DOL website as the COBRA premium subsidy is extended. If you have any questions about the COBRA subsidy extension, please contact the author of this Legal Alert, Lindsay O'Brien at 904-357-2005, or at lobrien@fordharrison.com, any member of Ford & Harrison's Employee Benefits practice group or the Ford & Harrison attorney with whom you usually work. President Signs Law Providing Tax Break for Employers Who Hire Unemployed WorkersOn March 18, 2009, President Obama signed the Hiring Incentives to Restore Employment (HIRE) Act, (Public Law No. 111-147), which, among other things, provides a tax break for employers who hire employees who have been unemployed for the preceding 60 days. The law provides that private employers who hire previously unemployed workers between February 3, 2010 and December 31, 2010 may qualify for a 6.2% payroll tax incentive. Essentially, this incentive exempts employers from paying Social Security taxes on wages paid to these employees after March 18, 2010. The law applies to businesses, agricultural employers, tax-exempt organizations and public colleges and universities. Employers must obtain an affidavit from each unemployed worker who is hired, stating that this person has not been employed for more than 40 hours during the 60-day period ending on the date the person begins employment. The IRS has indicated that it is developing a form employees can use to make the required statement. Employees hired to fill existing vacancies qualify for the exemption as long as the employee the new hire is replacing separated from employment voluntarily or for cause. Family members and other relatives do not qualify. Additionally, for 2011, employers can claim an additional general business tax credit of up to $1,000 for each previously unemployed employee who is retained for at least one year. According to information on the IRS web site, the reduced tax withholding will have no impact on the employee's future Social Security benefits and employers must still withhold the employee's share of Social Security taxes as well as income taxes. Additionally, the employer and employee's share of Medicare taxes still apply to these wages. See "Two New Tax Benefits Aid Employers Who Hire and Retain Unemployed Workers,." To learn more about taking advantage of tax credits including new hire credits, please contact KPA partner Tax Break LLC or download a free white paper on the HIRE ACT. President Announces Recess Appointment of Craig Becker to NLRBOn March 27, 2010, President Obama announced the recess appointment of Craig Becker to the National Labor Relations Board (NLRB). Becker's appointment will last until the end of 2011 when the Senate finishes its next term. President Obama also recess- appointed Democrat Mark Pearce to the Board. Pearce was a partner at a union-side law firm in Buffalo, New York. With the recess appointments, the NLRB now consists of 3 Democrats and 1 Republican. The business community is has expressed concern that, with Becker's appointment, the Board will alter existing processes to make it easier for unions to organize. For more information regarding Becker's background and the concerns raised by his appointment, please see our the Ford & Harrison Legal Alert, EFCA by Fiat? What a Becker Confirmation Could Mean for Employers. If you have any questions regarding the HR Compliance Updates please contact Jim Hendricks at Ford & Harrison LLC , 55 East Monroe Street, Suite 2900,Chicago, IL 60603 |
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