Daniel L. Morgan
The Consolidated Omnibus Budget Reconciliation Act (“COBRA”) requires group health plans to allow qualified beneficiaries who would otherwise lose coverage due to certain events to elect to continue coverage under the plans by paying a monthly premium of up to 102 percent of the plan’s cost of providing the coverage. Qualified beneficiaries include employees and former employees and their spouses and dependents who were covered by the plan at the time of loss of coverage.
COBRA Premium Assistance
The American Rescue Plan Act of 2021 (“ARPA”) requires employers to subsidize the cost of COBRA continuation coverage, or such costs under state mini-COBRA laws where COBRA does not apply—with an assist from Uncle Sam (as described below). This subsidy must be provided for qualified beneficiaries who become eligible for and elect COBRA (or a state’s mini-COBRA) benefits as a result of an employee’s loss of health plan coverage due to an involuntary termination of employment (other than for gross misconduct) or a reduction of hours. ARPA refers to people who satisfy these requirements as “Assistance Eligible Individuals.”
The COBRA and mini-COBRA premium subsidy is available only from April 1, 2021, through September 30, 2021. However, the subsidy also applies to Assistance Eligible Individuals who became eligible for COBRA or mini-COBRA prior to April 1, 2021, but whose COBRA coverage period would have extended to overlap with the period from April 1 through September 30, 2021. (See below for more insight.)
An Assistance Eligible Individual loses the subsidy if they become eligible for coverage under another group health plan, such as a plan sponsored by a new employer or a spouse’s employer), or becomes eligible for Medicare. Individuals receiving this COBRA subsidy must notify their plans if they become eligible for coverage under another group health plan or become eligible for Medicare. Failing to provide this notice can result in the individual having to pay a tax penalty to the IRS.
Continue reading “Employers Need to Gear Up for ARPA’s COBRA Subsidy”
Nicole N. Wentworth
On March 19, 2020, Governor Newsom gave another shot in the arm to California’s COVID-19 supplemental paid sick leave law, which (as amended) goes into effect today, March 29, 2021. The new statute, California Labor Code section 248.2, replaces and expands the state’s supplemental sick leave law that expired at the end of last year.
This new law covers all California employers with more than 25 employees, provides more paid sick leave, adds more qualifying reasons for leave, and entitles some employees to retroactive payment.
It is anticipated that all adults in California will be eligible to receive the COVID-19 vaccine by mid-April, shortly after the new leave law takes effect. Employers should therefore anticipate and prepare for a new a flood of leave requests as employees snag available appointments.
A New Dose of Supplemental Paid Sick Leave
Perhaps the most important update is that the new law provides more supplemental paid sick leave, which must be made available for immediate use upon the employee’s oral or written request.
Under the new law, full-time employees are entitled to 80 hours of supplemental paid sick leave.
Continue reading “California Injects More COVID-19 Supplemental Paid Sick Leave into the State as Vaccine Eligibility Expands”
Brooke T. Iley and Albert B. Krachman
Do not be surprised if, before the end of 2021, the federal government begins requiring contractors to certify or represent that their employees have received COVID vaccinations. The federal government has long conditioned contract awards on contractor compliance with emerging social policy mandates. This practice dates backs to the 1960s, when collateral social policy clauses began appearing in federal contracts. The National Emergency created by COVID-19 would appear ripe for a similar federal government action in federal contracting.
Several factors are converging in the United States which signal the potential for a COVID vaccine Certification or Representation. First, the supply issue should be mostly resolved by June 30, 2021. The Biden administration has committed to make enough vaccines available for every adult in the country by the end of May 2021. Second, the administration has been extremely active in making procurement law changes to conform to its policy objectives. Crafting an Executive Order on COVID Vaccines for federal contractor employees is clearly within the administration’s wheelhouse and target zone. Third, as reported in the March 8, 2021, Wall Street Journal, the largest employers in the country, across all sectors, are already engaged in large scale efforts to vaccinate their own employees. Fourth, while the law in this area is still evolving, the prevailing view is that, with certain exceptions, private employers are legally permitted to mandate their employees receive COVID vaccinations as a condition of continuing employment, subject to a variety of considerations related to employee legal, medical, and workplace accommodations. Finally, the federal government might find a federal contractor vaccine mandate a helpful leverage point in the evolving conflict with those states choosing to disregard COVID protections. Continue reading “Will Federal Contractors Be Required to Certify Employee COVID Vaccinations?”
Mara B. Levin, Anthony A. Mingione, and Jacob W.E. Kearney
The U.S. Equal Employment Opportunity Commission (“EEOC”) released updated guidance on December 16, 2020, to address the impact of COVID-19 vaccinations in the workplace. The guidance indicates that employers may require COVID-19 vaccinations for workers to be able to return to the workplace as long as employers comply with Title VII of the Civil Rights Act (“Title VII”), the Americans with Disabilities Act (“ADA”), and Title II of the Genetic Information Nondiscrimination Act (“GINA”).
Here are a few highlights:
- Administration of the vaccine by the employer (or a contractor on the employer’s behalf) is not a medical examination and does not implicate the ADA, GINA, or Title VII. Employers must ensure, however, that all vaccine pre-screening questions are “job-related and consistent with business necessity” and do not request genetic information.
- Asking or requiring employees to show proof of receipt of a COVID-19 vaccination is not a disability-related inquiry under the ADA because it is not likely to reveal information about any disability, nor does it impact GINA. Subsequent questions, such as “why did an employee not receive the vaccine,” would implicate concerns under the ADA and GINA, however. Employers must therefore also ensure that follow-up questions are “job-related and consistent with business necessity” and avoid asking questions about genetic information or family medical history.
- Employers must provide reasonable accommodations, subject to “undue hardship” analysis, to workers who are unable to get the vaccine because of a disability (under the ADA) or sincerely held religious beliefs (under Title VII).
- An employer may physically preclude an employee who cannot be vaccinated from entering the workplace when that employee poses a “direct threat to the health or safety of individuals in the workplace,” which threat cannot be eliminated by a reasonable accommodation. However, an employer may not automatically terminate the employment of that worker. Employers must consider what protections the employee may have under relevant EEO laws or other federal, state, and local authorities.
We encourage employers working on their return-to-work strategies to review the EEOC guidance as they consider how and whether to implement COVID-19 vaccination requirements. If you have any questions or need guidance specific to your workplace, please do not hesitate to contact Blank Rome for more information.
Daniel L. Morgan
The great majority of 401(k) plans allow participants to borrow against their plan benefits. These loans are secured by the borrowing participant’s plan account and are typically repaid by withholding amounts from the borrower’s paychecks.
Plan loans are subject to a number of limitations, including a repayment period of five years (unless the loan is used to acquire a primary residence) and a maximum borrowing limit of 50 percent of the borrower’s vested account balance or $50,000.* Violating these limits has adverse tax consequences to the borrower, which are not addressed in this article. The focus of this piece is what happens when someone has borrowed from a 401(k) plan within the limits, terminates employment, and then defaults on the loan—in particular, changes made by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and a 2017 change to the tax law, which are helpful to the large number of people who may find themselves in this situation during the pandemic.
Plan Loan Defaults by Terminated Employees = Plan Distributions
Under most 401(k) plans, borrowers who terminate employment before paying off their plan loan must either pay the entire remaining amount of the loan within a period of time specified by the plan after cessation of employment or, failing to do so, be considered to be in default on the loan, in which event the tax law treats the borrower as having received a distribution from the plan in the amount of the unpaid loan balance. The Internal Revenue Service (“IRS”) refers to this amount as a plan offset amount.
Continue reading “Defaulting 401(k) Plan Borrowers in the Time of COVID”
Jason E. Reisman
On August 3, 2020, at the urging of the State of New York, U.S. District Judge Paul Oetken of the Southern District of New York struck down four different provisions of the U.S. Department of Labor’s (“DOL”) implementing regulation for the Families First Coronavirus Response Act (“FFCRA”): (1) the “work availability” requirement, under which paid leave is only available if an employee has work from which to take leave; (2) the requirement of employer permission to take leave intermittently; (3) the definition of “health care provider” for purposes of exclusion from paid leave benefits; and (4) the requirement for an employee to provide certain documentation before taking leave. New York v. U.S. Dep’t of Labor, 2020 WL 4462260 (S.D.N.Y. Aug. 3, 2020).
Although the judge did not issue a “nationwide” injunction, the mere fact that there was a decision by a federal judge striking certain important provisions of the FFCRA regulation left employers (or maybe just their counsel) in a panic about the implications outside of New York. Would this decision impact eligible employees in California? Would the decision be retroactive? Would the DOL appeal? Would it seek a stay of the decision while the appeal was pending? Continue reading “Strident DOL Revises FFCRA Reg, Thumbs Its Nose at NY Federal Court Decision”
During the pandemic, many employers have permitted employees to work remotely/telework in an effort to slow the spread of COVID-19. As the incidence of the virus has subsided in certain geographic areas, employers have begun to reopen their worksites and have required employees to return to their physical place of work. In doing so, these employers have been met with requests from certain employees that they be permitted to continue working remotely, leading to the question of whether the employer is required to grant such a request. In Technical Assistance Questions and Answers issued on September 8, the U.S. Equal Employment Opportunity Commission (“EEOC”) answered the question with a qualified “NO.” Continue reading “EEOC Says Work-from-Home Not Guaranteed as Post-Pandemic Reasonable Accommodation”
Emery Gullickson Richards
As employers seek to support employees losing loved ones to the coronavirus COVID-19, thoughtful consideration of workplace measures takes on critical significance. How employers support employees through the loss of a loved one has an indelible impact on the lives of employees, the work environment, and the organization’s integrity. Bereavement leave policies address the unprecedented circumstances created by the mounting, tragic toll of COVID-19, providing support to employees at the time when they need it most. Although bereavement leave policies are not legally required in most jurisdictions in the United States, most U.S. employers offer some amount of paid bereavement leave.
Bereavement Leave Laws
Only a small number of jurisdictions have bereavement leave laws. For example, the Oregon Family Leave Act (“OFLA”) provides employees at certain employers in the state with the right to take protected leave to make funeral arrangements, attend a funeral, or to grieve a family member who has passed away. This bereavement leave may last for a period of up to two weeks and must be completed within 60 days of the employee learning of the death of their loved one. Similarly, the Illinois Child Bereavement Leave Act provides employees with bereavement leave rights in the event of the loss of a child, and an employee who loses more than one child within a year may take up to six weeks of bereavement leave. Other states, such as Massachusetts, have considered similar laws. Recently, a Massachusetts resident created an online petition urging legislators to take up the cause again amid the coronavirus pandemic, highlighting the increased focus on these policies today. Continue reading “Bereavement Leave and Employee Support Amid COVID-19”
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:
- Childcare—to care for a child due to a school or daycare closure;
- Mandatory quarantine— to care for a family member subject to mandatory quarantine; and
- 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”
Asima J. Ahmad
On April 14, 2020, New Jersey Governor Phil Murphy signed Senate Bill 2353 into law, which excludes mass layoffs resulting from the coronavirus COVID-19 pandemic from the notice and severance pay requirements contained in the Millville Dallas Airmotive Plant Job Loss Notification Act (“NJ WARN”). Prior to this change, employers faced uncertainty on whether they would be obligated to provide notice and severance pay to each full-time employee that was terminated with less than the required 60-days’ notice due to the pandemic.
Specifically, SB 2353 revises the definition of “mass layoff” to mirror the exceptions that are already contained in NJ WARN’s definition of “termination of operations.” As a result, a mass layoff which would otherwise require notice shall not include one “made necessary because of a fire, flood, natural disaster, national emergency, act of war, civil disorder or industrial sabotage, decertification from participation in the Medicare and Medicaid programs as provided under Titles XVIII and XIX of the federal “Social Security Act,” Pub.L. 74-271 (42 U.S.C. s.1395 et seq.) or license revocation pursuant to P.L.1971, c.136 (C.26:2H-1 et al.).” These changes go into effect immediately and are retroactive to March 9, 2020, the date that Governor Murphy declared a COVID-19-based state of emergency and public health emergency in New Jersey via Executive Order 103. Continue reading “NJ WARN Amended in Light of COVID-19 Pandemic”