By Kara Kearns,
Oklahoma; Rona Finkelstein, Maryland; Eileen Gallagher, California;
Ed Coates, Texas
With the New Year, Human Resource professionals
have encountered several significant changes in regulations that
will impact their workload. Some of these changes were
anticipated and others, sparked by the economic downturn, were not.
Since Jan. 1, new regulations or legislation impacted the
following:
- Americans
with Disabilities Act (ADA)
- Family
Medical Leave Act (FMLA)
- Ledbetter
Fair Pay Act
- American
Recovery Reinvestment Act
- I-9s,
Mental Health benefits, and CHIP
Below is a summary of these changes, steps to
comply, and resources that are available to assist with compliance.
Please note that this article is only a summary of new regulations
and is not intended to be legal advice. Human Resources
professionals should consult with their legal counsel on steps to
remain in compliance.
American with Disabilities Amendment Act (Effective
Jan. 1, 2009
)
When
Congress enacted the Americans with Disabilities Act of 1990 (ADA),
it intended to provide a clear and comprehensive national mandate
for the elimination of discrimination against individuals with
disabilities and to provide broad coverage of disabilities under ADA.
Congress expected that the definition of disability under the ADA
would be interpreted the same way the courts interpreted the
definition of a handicapped individual under the Rehabilitation Act
of 1973. However, because of Supreme Court ruling since 1990
and subsequent lower court rulings, that expectation has not been
fulfilled. Congress also found that the Court’s rulings have
narrowed the scope of protection intended to be afforded by the ADA. Therefore, on
Sept. 25, 2008, President George Bush signed the Americans with Disabilities Act
Amendments Act of 2008 ("ADAAA"). It went into
effect
Jan. 1, 2009.
The ADAAA emphasizes that the definition of disability should be
interpreted in favor of broad coverage of individuals to the fullest
extent permitted by the ADA, and generally should not require extensive analysis.
The ADA defines a person with a disability as: 1)
someone with a physical or mental impairment that substantially
limits one or more major life activities; 2) someone with a record
of such impairment; or 3) someone who is regarded as having a
physical or mental impairment – even though there is no impairment
or the impairment is not as limiting as believed by the employer.
The
ADAAA has clarified the definition of a disability by providing
specific examples of major life activities, noting episodic
impairments or remissions in medical conditions and even listing
major bodily functions and qualifying diseases, like diabetes. It
has directed the EEOC to revise the definition of the term
“substantially limits” and determined that the use of the term
“significantly restricted” is too high a standard for employees
to be required to reach.
The
Amendment changes the definition of "regarded as" so that
it no longer requires a showing that the employer perceived the
individual to be substantially limited in a major life activity, and
instead says that an applicant or employee is "regarded
as" disabled if he or she is subject to an action prohibited by
the ADA (e.g., failure to hire or termination) based on an
impairment that is not transitory and minor. It also provides
that individuals covered only under the "regarded as"
prong are not entitled to reasonable accommodation.
As
Human Resource professionals, it is important that we not only
understand these new changes, but also communicate them. The
EEOC has developed compliance materials to assist employers with
these changes and provides a summary statement for distribution and
training purposes. This information can be found at: http://www.eeoc.gov/ada/amendments_notice.html
Family Medical Leave Act (Effective
Jan. 16, 2009
)
The U.S. Department
of Labor published the Final Rule, effective
January 16, 2009, to implement amendments to the Family and Medical Leave Act (FMLA).
The Final Rule covers new military family leave entitlements which
were signed into law by President Bush, as well as other revisions
to the FMLA.
Among the most
significant changes are two amendments to the FMLA resulting from
the passage of military family leave provisions in the National
Defense Authorization Act for FY 2008 (NDAA, Pub. L.110-181). The
first provision provides that eligible employees who are family
members of covered service members are now able to take up to 26
work weeks of leave in a “single 12-month period” to care for a
covered service member with a serious illness or injury incurred
while on active military duty. Not only is FMLA protection
extended from 12 weeks to 26 weeks for qualifying employees, but
this provision also gives FMLA protection to additional family
members beyond those who are eligible to take FMLA leave for other
reasons specified under FMLA.
The second provision
permits an employee to take FMLA leave for “any qualifying
exigency (as the Secretary [of Labor] shall, by regulation,
determine) arising out of the fact that the spouse, or a son,
daughter, or parent of the employee is on active duty (or has been
notified of an impending call or order to active duty) in the Armed
Forces in support of a contingency operation.” The Final
Rule lists a number of categories that would constitute a
“qualifying exigency” to include short-notice deployment,
military events and related activities, certain childcare and school
activities, making or updating financial and legal arrangements,
attending counseling, rest and recuperation leave during deployment,
certain enumerated post-deployment activities, and other activity
not encompassed in the other categories but agreed to by the
employer and employee.
The Final Rule
also provides guidance on the definition of serious health
condition, clarifies the substitution of paid leave, clarifies the
time frames in which employees must return required documentation,
changes the treatment of perfect attendance awards, moves all
employer notice requirements into one section of the regulations,
modifies the employee notice provision, gives guidance as to the
medical certification process, and revises the fitness-for-duty
certification process.
Pursuant to the
Final Rule, employers must provide their employees with notice of
their FMLA rights. Additionally, included in the final rule
are four new Department of Labor certification forms for use when an
employee is requesting leave for a serious health condition for
themselves or a dependent and in the event of the two types of
military-related leave.
For more
information on the FMLA amendments and the
DOL’s Final Rule, go to the U.S. Department of Labor’s Web site, www.dol.gov/esa/whd/fmla
or to www.shrm.org.
Lilly Ledbetter Fair Pay Act (Effective
February 2009)
The Lilly Ledbetter Fair Pay Act of 2009 amends
the Civil Rights Act of 1964, clarifying that a discriminatory
compensation decision occurs each time discriminatory compensation
is paid. This amendment is in response to a 2007 Supreme Court
decision which stated that the statute of limitations starts with
the first discriminatory paycheck. The effect for employers is
that employees now have a much longer window of time within which to
file equal pay lawsuits.
Allen Smith of the Society for Human Resources
Management (SHRM) in an online article, Ledbetter Act Adds Lengthy
To-Do List for HR (Feb. 10, 2009) notes that pay disparities may
exist for a number of defensible reasons including role, education,
experience, industry or geographic location. Key for employers
and Human Resources professionals will be to keep adequate records
documenting pay decisions, and in light of the Ledbetter Fair Pay
Act, to keep those records an appropriate length of time.
American
Recovery Reinvestment Act (Effective February 2009)
The American
Recovery and Reinvestment Act of 2009 (ARRA) includes provisions
that impact benefits continuation under the Consolidated Omnibus
Budget Reconciliation Act of 1985 (COBRA). Under the ARRA,
employees involuntarily terminated from employment between
Sept. 1, 2008
, and
Dec. 31, 2009, may be eligible for a premium subsidy equal to 65% of the COBRA
premium. The subsidy is available for up to nine months of COBRA
coverage.
In order to be
eligible for the subsidy, a terminated employee must meet all the
following requirements:
1. Have been
involuntarily terminated from employment, but not for gross
misconduct,
2. Be ineligible for
other group health plan coverage or Medicare,
3. Have a
modified adjusted gross income that does not exceed $145,000 for
single individuals or $290,000 for married individuals filing
jointly in the year in which the subsidy is received,
4. Not currently
be receiving assistance through the Health Coverage Tax Credit
program under the Trade Assistance Act.
Plan sponsors are
required to provide a new COBRA election notice to employees who
terminated employment (both voluntary and involuntary) after
Sept. 1, 2008, and allow for a new 60-day COBRA election period for those who had
previously not elected COBRA prior to the passage of ARRA.
Former employees
electing the subsidy for COBRA coverage pay 35% of the COBRA rate
for coverage elected and the plan sponsor is required to seek
reimbursement for the subsidy amount. The reimbursement to
plan sponsors is provided through a credit against future payroll
tax payments to the IRS.
Plan sponsors should review their
current COBRA administration policies or consult with their COBRA
vendors, if COBRA administration is outsourced, to ensure their
plans are compliant. Plan sponsors should also review
reimbursement requirements and coordinate with the entity that
processes payroll to submit the reimbursement requests. For
more information about the COBRA subsidy, visit: www.dol.gov/ebsa/cobra.html
or www.irs.gov
I-9s, Mental Health Parity, HIPAA and CHIPRA
Effective
Apr. 3, 2009, employers were required to utilize a revised I-9 form to verify
employees’ eligibility to work in the
United States. For more information about the I-9 process and the new forms
visit http://www.uscis.gov/portal/site/uscis
The Mental Health Parity Act of 2008 requires
health plans to treat mental health conditions like any other
illness. Plan sponsors can no longer apply different plan
limitations for mental health services than other covered services.
The new requirements are effective for plan years starting after
Oct. 3, 2009. For more information visit www.cms.hhs.gov/healthinsreformforconsume/04_thementalhealthparityact.asp
ARRA also included significant changes to HIPAA
privacy and security rules. The new HIPAA regulations impose
larger penalties for non-compliance, require notification of impact
to individuals in the event of a breach, and implement other new
requirements over the next four years. For more information
visit www.hipaa.gov
The Children’s Health Insurance Program
Reauthorization Act (CHIPRA) requires plan sponsors to provide
notices to health plan participants about the availability of CHIP
and requires plan sponsors to share certain information with state
agencies that administer CHIP. Implementation of the new CHIP
regulations is contingent on individual states adopting the new CHIP
eligibility requirements. The Department of Health and Human
Services is scheduled to issue state specific sample notices for
employers to use by
Feb. 4, 2010. For more information visit www.cms.hhs.gov/home/chip.asp
Conclusion
Human Resources professionals should routinely
monitor the regulatory environment for new and revised regulations.
Human Resource professional organizations such as the Society for
Human Resources Management and WorldatWork are good sources to stay
abreast of new regulations. HR professionals should also
consult with their legal counsel when evaluating any new
regulations.
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