Search This Blog

Friday, April 30, 2010

COBRA Notices Updated














Alabama@Work
Tommy Eden, Attorney

On April 27, 2010, the federal Department of Labor's Employee Benefits Security Administration once again released updated model COBRA notices that employers and group health plan administrators can use to comply with notice requirements. Under COBRA, as amended, employers or plan administrators must send notices to assistance eligible individuals who are employees, their spouses, and employees' dependents who lose group health plan coverage due to certain qualifying events, including employees' involuntary employment termination that occurs between Sept. 1, 2008, and May 31, 2010. Notices must be provided to assistance eligible individuals within a certain number of days after qualifying events occur. To learn more about notice requirements and review the model notices and DOL guidance see: http://www.dol.gov/ebsa/cobra.html

New notices must be postmarked as mandated to avoid substantial fines of $110 a day and attorney fee claims. Examine all your employee terminations since beginning Sept 1, 2008 and determine if you need to take action today.

Common Sense Counsel: All DOL model notices and forms must be modified for use with your group health plan by inserting specific information and deleting inapplicable provisions. ARRA is highly complicated as this DOL and IRS guidance show. Doing nothing, or guessing wrong, can be expensive.


Tommy Eden is a Lee County native, an attorney with the local office of Constangy, Brooks & Smith, LLP and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com

OSHA’s Severe Violator Enforcement Program








Alabama@Work
Tommy Eden, Attoney

On April 22, the federal Occupational Safety and Health Administration (OSHA), announced its new Severe Violator Enforcement Program becomes effective within 45 calendar days of the announcement. OSHA stated purpose is to focus enforcement efforts against employers that demonstrate “indifference to safe workplace responsibilities under the federal Occupational Safety and Health Act.” Employers can be considered severe violators if they”commit willful, repeated, or failure-to-abate violations for certain serious hazards or unsafe work conditions.” The full text of the announcement is at http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=NEWS_RELEASES&p_id=17544


If you are not easily sacred go to OHSA Recent News and take a look at the fines: http://www.osha.gov/pls/oshaweb/owasrch.search_form?p_doc_type=NEWS_RELEASES&p_toc_level=0&p_keyvalue=&p_status=CURRENT

OSHA also announced its plan to increase the overall dollar amount of penalties that are assessed for OSHA violations. The current maximum penalty for a serious violation, one capable of causing death or serious physical harm, is only $7,000 and the maximum penalty for a willful violation is $70,000. The average penalty for a serious violation will increase from about $1,000 to an average $3,000 to $4,000. Monetary penalties for violations of the OSH Act have been increased only once in 40 years despite inflation. The Protecting America's Workers Act would raise these penalties, for the first time since 1990, to 12,000 and $250,000, respectively. Future penalty increases would also be tied to inflation.

Common Sense Counsel: It is advised that you have a comprehensive safety audit conducted ASAP. The next time the Government “come to help you” the cost of being in the wrong just went up.


Tommy Eden is a Lee County native, an attorney with the local office of Constangy, Brooks & Smith, LLP and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com

Thursday, April 29, 2010

Workplace Drug Testing: HHS Guidelines Effective Date Changed to October 1, 2010















Alabama @ Work
By Tommy Eden

Posted for display in today’s Federal Register for publication tomorrow is a Department of Health and Human Services (HHS) Final Rule changing the effective date of the Revisions to the Mandatory Guidelines for Federal Workplace Drug Testing Programs (Mandatory Guidelines) from May 1, 2010, to October 1, 2010.

The document is available at the Federal Register’s website: http://www.federalregister.gov/OFRUpload/OFRData/2010-10118_PI.pdf or can be viewed by downloading the attachment.

The purpose of the HHS Final Rule is to notify participants in Federal and federally-regulated workplace drug testing programs as soon as possible that they will not be expected to implement the revisions to the Mandatory Guidelines on May 1, 2010, so that they do not unnecessarily expend resources to comply on May 1, or risk compliance problems by prematurely implementing new provisions.

On February 4, 2010 the Department of Transportation issued Notice of Proposed Rulemaking (NPRM) proposing to align its regulated-industry drug testing with the HHS laboratory drug testing requirements. The 60-day public comment period for the NPRM officially ended on April 5, 2010, with late filed comments considered to the extent practicable.

The DOT’s NPRM process takes some time, as does the process of deciding upon and writing the contents of a final rule. The HHS decision to change the effective date of the Mandatory Guidelines should enable the DOT to issue its final rulemaking in time to meet the October 1st date.

Common Sense Counsel: There have been many changes in the DOT regulations over the past 2 years and more to come by October 2010 with a change in cutoff level and the addition of ecstasy to the testing panel. Now is a good time to audit you entire DOT training and compliance program.


Tommy Eden is a Lee County native, an attorney with the local office of Constangy, Brooks & Smith, LLP and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com

Monday, April 26, 2010

Employee Discipline Done Right















Alabama@ Work
By Tommy Eden, Attorney

In Schaaf v. SmithKline Beecham Corp. d/b/a GlaxoSmithKline (11th Cir. Apr. 6, 2010) the Court affirmed the dismissal of an employee’s Family and Medical Leave Act (FMLA) claim holding that SmithKline did not violate the law by demoting an employee when she returned from maternity leave for performance deficiencies discovered while the employee was out on leave.

In July 2002, three District Sales Managers complained in writing to the SmithKline HR department that Schaaf had (1) an antagonistic and inflexible management style, (2) was inaccessible, (3) had poor communications skills, (4) tended to play favorites, and (5) failed to give feedback on performance. SmithKline issued Schaaf a verbal warning, and her supervisor directed Schaaf to complete a Performance Improvement Plan (“PIP”). The PIP required Schaaf to issue previously uncompleted written performance reviews and to attend management-training programs. At about the same time, she informed her supervisor that she was pregnant and would take FMLA leave seven months later. During the next 7 months she failed to complete the performance evaluations, failed to take any training and failed to meet the PIP’s deadline.

During Schaaf’s leave, an interim assumed her duties and the region functioned significantly better with increased productivity, improved communication, and morale was higher. Shortly before Schaaf’s return, concerns were expressed that the region’s increased morale and productivity would end if Schaaf resumed her position. The day Schaaf return from FMLA leave her supervisor gave her a choice of either accepting a demotion or leaving SmithKline. She accepted the demotion and sued for interference with her FMLA rights. The District Court Judge granted SmithKline’s motion to dismiss as a matter of law and Schaaf appealed.

The 11th Circuit Court assumed that Schaaf successfully established a prima facie case for FMLA retaliation: because she showed (1) she took leave to care for her newborn child, (2) SmithKline demoted her, and (3) her demotion was temporally proximate to her leave. SmithKline proved that it demoted Schaaf because of managerial ineffectiveness, a legitimate reason unrelated to her FMLA leave. Schaaf argued that, because SmithKline learned of certain performance issues while she was on leave, her leave caused her demotion. The Court held that the FMLA purpose “is not implicated in the least if an employee’s absence permits her employer to discover past professional transgressions that then lead to an adverse employment action against the employee. Such absurdities would effectively protect deficient employees from adverse employment actions, such that those workers could actually attain job security by seeking leave under the FMLA.” The Court found such argument “laughable” and unsupported by policy, common sense, or the FMLA itself. It is refreshing to hear that type of justice.

Common Sense Counsel: This case is an outstanding example of an employer taking prompt steps to discipline an employee, with well drafted written warnings, supported by statements from co-workers and a Performance Improvement Plan. Remember the 4 steps to good discipline are: 1) Do it Regularly 2) Be Objective 3) Give Examples and 4) Review with Employee. Given the potential risk of liability when taking adverse action against someone just back from FMLA, don’t do this at home without first consulting your management labor counsel.


Tommy Eden is a Lee County native, an attorney with the local office of Constangy, Brooks & Smith, LLP and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com







Monday, April 12, 2010

IRS Releases Forms for Claiming HIRE Tax Exemption















Alabama@Work
By Tommy Eden, Attorney

The Internal Revenue Service has released a new form that will help employers claim the special payroll tax exemption that applies to many newly-hired workers during 2010, created by the Hiring Incentives to Restore Employment (HIRE) Act. The Hiring Incentives to Restore Employment (HIRE) Act Employee Affidavit, is now posted on IRS.gov, along with answers to frequently-asked questions: http://www.irs.gov/businesses/small/article/0,,id=220745,00.html
about the payroll tax exemption and the related new hire retention credit. Form W-11 can be retrieved at http://www.irs.gov/pub/irs-pdf/fw11.pdf

The new law requires that employers get a statement from each eligible new hire, certifying under penalties of perjury, that he or she was unemployed during the 60 days before beginning work or, alternatively, worked less than a total of 40 hours for anyone during the 60-day period. Employers can use Form W-11 to meet this requirement. Though employers need this certification to claim both the payroll tax exemption and the new hire retention credit, they do not file these statements with the IRS. Instead, they must retain them along with other payroll and income tax records.

Most eligible employers use Form 941, Employer’s Quarterly Federal Tax Return, to claim the payroll tax exemption for eligible new hires. This form, revised for use beginning with the second calendar quarter of 2010, is currently posted as a draft form on IRS.gov and will be released next month as a final along with the form’s instructions. See revised draft Form 941: http://www.irs.gov/businesses/small/article/0,,id=220745,00.html

The HIRE Act, signed into law March 18 created two new tax benefits designed to encourage employers to hire and retain new workers. Employers who hire unemployed workers after February 3, 2010, and before January 1, 2011, may qualify for a 6.2% payroll tax incentive, in effect exempting them from the employer’s share of social security tax on wages paid to these workers after March 18. In addition, for each unemployed worker retained for at least a year, businesses may claim a new hire retention credit of up to $1,000 per worker when they file their 2011 income tax returns.

Common Sense Counsel this a great way to stimulate the Alabama economy and get a tax credit. But you must have the Form W-11 signed by the new employee. Also important that you read over the Q&A and use the revised Form 941 once released.


Tommy Eden is a Lee County native, an attorney with the local office of Constangy, Brooks & Smith, LLP and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com