Category: Benefits advice and counseling

Act Now! Changes to New York Sick Leave Are Here

Jacob W.E. Kearney, Stephen E. Tisman, Mara B. Levin, and Anthony A. Mingione

New York State’s amendments to its Labor Law requiring all employers to provide sick leave to employees are effective on Wednesday, September 30, 2020. Signed into law by Governor Cuomo in April as part of the State Budget (Senate Bill S7506B), our prior post detailed that the new amendments require employers to provide between 40 and 56 hours of guaranteed sick leave depending on employer size and net income. Starting Wednesday, covered employees will be entitled to accrue sick leave although the employees may be restricted from using that accrued leave until January 1, 2021.

Under New York’s Labor Law’s new requirements:

      • Employers with 100 or more employees must allow employees to accrue at least 56 hours of paid sick leave each calendar year;
      • Employers with between five and 99 employees must allow employees to accrue at least 40 hours of paid sick leave each calendar year;
      • Employers with fewer than five employees but having a net income greater than one million dollars in the previous tax year must allow employees to accrue at least 40 hours of paid sick leave each calendar year; and
      • Employers with fewer than five employees but having a net income less than one million dollars in the previous tax year must allow employees to accrue at least 40 hours of unpaid sick leave each calendar year.

Continue reading “Act Now! Changes to New York Sick Leave Are Here”

Deferral of Employee Social Security Taxes Not Even a Good Idea on Paper

Daniel L. Morgan

In a Memorandum to the Secretary of the Treasury, President Trump directed that the Secretary use his authority to defer the withholding and payment of the employee’s share of certain Social Security taxes for the period September 1, 2020, through December 31, 2020, and that employers be permitted to pay the deferred taxes during the period beginning January 1, 2021, and ending April 30, 2021. On August 28, 2020, the Secretary followed the directive by issuing guidance in the form of IRS Notice 2020-65.

What the IRS Notice Says

According to the Notice, the taxes imposed by Section 3102(a) of the Internal Revenue Code on taxable wages paid (not earned) between September 1, 2020, and December 31, 2020, may be deferred. Importantly, though not explicitly stated, the Notice does not require an employer to defer the withholding and payment of the taxes. It simply extended the deadline for such withholding and payment. Continue reading “Deferral of Employee Social Security Taxes Not Even a Good Idea on Paper”

Empire State Requires All Employers to Provide Sick Leave

Mara B. Levin, Anthony A. Mingione, and Jacob W.E. Kearney

Late last month, Governor Cuomo signed into law the State Budget (S7506B), which includes new paid and unpaid sick leave requirements for employers in New York State. The law requires that all employers provide workers with job-protected sick leave, with the amount of leave dependent upon the employer’s size, number of employees, and net income. The law goes into effect September 30, 2020, but employers can prohibit the use of sick leave accrued under the law until January 1, 2021.

The law requires:

  • Employers with 100 or more employees must provide at least 56 hours of paid sick leave each calendar year;
  • Employers with between five and 99 employees must provide at least 40 hours of paid sick leave each calendar year;
  • Employers with fewer than five employees but having a net income greater than one million dollars in the previous tax year must provide at least 40 hours of paid sick leave each calendar year; and
  • Employers with fewer than five employees but having a net income less than one million dollars in the previous tax year must provide at least 40 hours of unpaid sick leave each calendar year.

Employers can fulfill their obligations by either providing the sick leave in a lump sum at the beginning of the calendar year (i.e., frontloading it) or by allowing employees to accrue sick leave at a rate of not less than one hour for every 30 hours worked, beginning at the later of September 30, 2020, or the commencement of  employment. While current employees will begin accruing sick leave in 2020, employers are not required to permit usage of that accrued time until January 2021. Employees must be allowed to carry unused sick leave over to the next calendar year, but employers can restrict the use of sick leave to the maximum hours guaranteed under the law (either 40 or 56). The carryover of hours is intended to allow employees to maintain continuity and a bank of sick leave, which avoids accruals starting from zero every year; and the cap is meant to keep the total usage in a given year from being problematic for employers. Employers are not, however, required by the law to pay an employee for unused sick leave upon the employee’s termination, resignation, retirement, or other separation from employment.

The law’s requirements act as a floor, and employers can provide employees with additional benefits and sick leave in excess of the law’s requirements.  Significantly, the sick leave requirements in S7506B are not limited to the COVID-19 pandemic but rather are permanent.

Another Round for the Garden State! New Jersey Again Changes Leave and Disability Benefits for COVID-19 Impacted Employees

Thomas J. Szymanski

New Jersey Governor Phil Murphy recently signed S2374 into law, expanding the New Jersey Family Leave Act (“NJFLA”) and New Jersey Temporary Disability Benefits Law (“NJTDBL”) and providing additional employee protections during the coronavirus COVID-19 pandemic and future epidemics, including (1) the expansion of reasons for leave; (2) certification changes; (3) intermittent use of such leave; (4) changes related to highly compensated employees; and (5) the expansion of the scope of compensable leave under NJTDBL. These changes are effective immediately and apply retroactively to March 25, 2020.

NJFLA—Expanded Reasons for Leave

During a state of emergency declared by the Governor, or when indicated to be needed by the Commissioner of Health or other public health authority, due to “an epidemic of a communicable disease, a known or suspected exposure to the communicable disease, or efforts to prevent spread of a communicable disease,” an employee may use NJFLA leave for the following new reasons:

    1. Childcare—to care for a child due to a school or daycare closure;
    2. Mandatory quarantine— to care for a family member subject to mandatory quarantine; and
    3. Voluntary self-quarantine—to care for a family member whose doctor recommends a voluntary self-quarantine.

Continue reading “Another Round for the Garden State! New Jersey Again Changes Leave and Disability Benefits for COVID-19 Impacted Employees”

Guidance for Employers to Address Coronavirus in the Workplace

Brooke T. Iley, Jason E. Reisman, Susan L. Bickley, Anthony B. Haller, Mara B. Levin, and Taylor C. Morosco

COVID-19 (commonly referred to as the “coronavirus”), a respiratory illness that was first diagnosed in Wuhan, China, in late 2019, has hit the United States. The World Health Organization (“WHO”) has declared the outbreak a public health emergency of international concern and the virus is being classified as an epidemic. With the spread of the virus, employers face a series of constantly evolving questions regarding their competing legal obligations to provide a safe workplace, while protecting the privacy rights of their employees, and without violating anti-discrimination laws.

WHAT LAWS ARE POTENTIALLY IMPLICATED?

Before an employer responds to these challenges, they should be familiar with the laws implicated with an epidemic like the coronavirus:

Occupational Safety and Health Act (“OSHA”)

OSHA’s General Duty Clause requires employers to maintain a safe workplace for all workers and to distribute information and training about workplace hazards. It also bars employers from retaliating against employees for exercising their rights to safe workplaces.

The situation is constantly evolving. Employers must monitor the developments about the ongoing outbreak and assess government notifications to formulate appropriate workplace responses and preventative measures.

Americans with Disabilities Act (“ADA”)

The ADA protects employees from discrimination based on their disability, record of a disability, or perceived disability. “Disability” has a broad definition, which could cover the coronavirus. This means that those who have or are suspected of having the coronavirus could be covered by the ADA, depending on its impact on the employee, or, for instance, if an employee is perceived to be disabled. Employers must be sensitive to the risk of discrimination under the ADA. The ADA also requires employers to keep employee medical information and records confidential and in a separate folder from the employee’s personnel file.

Employers must balance these competing legal requirements as they adjust business practices to address coronavirus concerns. Employers should act to protect their workforce, with an eye toward discrimination laws, all the while maintaining tact and sensitivity towards those who have or may be suspected of having contracted the virus. This is not a science and often involves a case-by-case determination.

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Some Highlights from the Recently Enacted SECURE Act, Part 4

Daniel L. Morgan

The final installment of this blog series discussing changes made by the Setting Every Community Up for Retirement Enhancement Act of 2020 (“the SECURE Act”) focuses on modifications to the required minimum distributions rules (“RMDs”).

Two of the most widely reported changes made by the SECURE Act relate to the requirements in the Tax Code that require individuals to receive annual RMDs.

72 Is the New 70½

The tax law generally requires people to begin receiving distributions from employer retirement plans and individual retirement accounts (“IRAs”) by the April 1st following the year in which they reach age 70½.[1] Under the SECURE Act, effective for people who attain age 70½ after December 31, 2019, age 70½ is replaced with age 72. Continue reading “Some Highlights from the Recently Enacted SECURE Act, Part 4”

As We Predicted, Challenges to NY Reproductive Health Decision-Making Law Have Begun

Stephen E. Tisman

In a December 17, 2019, Blank Rome Workplace post, we described the law enacted in New York expanding “protected status” to cover employee decision-making regarding reproductive rights matters. (See blankromeworkplace.com/2019/12/17/new-york-expands-discrimination-protection-to-reproductive-health-decision-making/). We concluded with the prediction that:

The law will undoubtedly be challenged by an employer claiming that providing such coverage violates the employer’s religious beliefs (think Masterpiece Cakeshop v. Colorado Civil Rights Commission). The ultimate fate of this statute will be resolved under federal First Amendment law.

That challenge has begun. On January 31, 2020, a lawsuit was filed in federal district court seeking a declaration that the statute is unconstitutional and void, and for an injunction to bar enforcing it against the plaintiffs. Christopher T. Slattery, et al. v. Andrew M. Cuomo, et al., U.S.D.C., N.D.N.Y., Case No. 5:00-at-99999.

Stay tuned for developments.

Some Highlights from the Recently Enacted SECURE Act, Part 3

Daniel L. Morgan

This third installment of summaries of some of the key provisions of the Setting Every Community Up for Retirement Enhancement Act of 2020 (“the SECURE Act”) discusses an extension of the date for adopting a new employer retirement plan.

Under prior law, an employer that wanted to deduct a contribution to a tax-qualified retirement plan for a tax year had to adopt the plan by the last day of the year, but had up until the due date of the tax return for the year, including extensions, to make the contribution.

Effective for tax years beginning after December 31, 2019, the SECURE Act allows an employer to adopt a tax-qualified retirement plan for a tax year up until the due date, including extensions, of the tax return for the year. Continue reading “Some Highlights from the Recently Enacted SECURE Act, Part 3”

Some Highlights from the Recently Enacted SECURE Act, Part 2

Daniel L. Morgan

In this second of a four-part series providing an overview of some key provisions of the Setting Every Community Up for Retirement Enhancement (“SECURE”) Act of 2019, I summarize the Act’s liberalization of the 401(k) plan nondiscrimination testing safe harbors and the Act’s effort to make it easier for employers to offer annuity payments as a distribution option under 401(k) plans. I also discuss why the changes made by the Act do not go nearly far enough to remove the legal and regulatory barriers that discourage 401(k) plans from offering annuity payments.

Easing of 401(k) Safe Harbor Requirements

An employer can avoid the Internal Revenue Service (“IRS”) nondiscrimination test applicable to elective contributions to a 401(k) plan by satisfying safe harbor requirements that include making a matching contribution or a matching contribution to the plan.

The SECURE Act increases employer flexibility in using these safe harbors, in several respects. Continue reading “Some Highlights from the Recently Enacted SECURE Act, Part 2”