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SHRM Newsletter: Health Care Reform W-2 Form Reporting Delayed

10/18/2010

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October 18, 2010

This is Utah SHRM Legal-mail no. 2010-15 prepared for Salt Lake SHRM, the Human Resources Association of Central Utah (HRACU), the Northern Utah Human Resources Association (NUHRA), the Color Country Human Resources Association (CCHRA), the Bridgerland Society for Human Resource Management and Utah at-large members of the national Society for Human Resource Management (SHRM).

CONTENTS:

-  HEALTH CARE REFORM W-2 FORM REPORTING DELAYED
-  DOL STRATEGIC PLAN FOCUSES ON MISCLASSIFIED WORKERS
-  NEW FINANCIAL INSTITUTION DIVERSITY REQUIREMENTS

-  SOME NEW CALIFORNIA EMPLOYMENT LAWS
-  REMEMBER VOTING INTEGRITY AND ELECTION LEAVE STATE LAWS

HEALTH CARE REFORM W-2 FORM REPORTING DELAYED: The Internal Revenue Service (IRS) has delayed for one year a requirement of the health reform law that employers report the value of an employee's health plan on tax forms.  The IRS issued a notice (found at: http://www.irs.gov/pub/irs-drop/n-2010-69.pdf) indicating that the W-2 reporting requirement will not become mandatory until an employer issues W-2 forms for employee income earned in 2012.  The IRS also has issued a draft (remember, this is only a draft) W-2 form for reporting 2011 income (available at:  http://www.irs.gov/pub/irs-utl/draft_w-2.pdf).  Regarding employer-sponsored health care benefits, the draft form states, “Cost of employer-sponsored health coverage (if provided by the employer). The reporting in Box 12, using Code DD, of the cost of employer-sponsored health coverage is for information only. The amount reported with Code DD is not taxable.”  The bottom line on all this appears to be that you can-but need not-report the value of health benefits on W-2 forms until you issue them in January of 2013, reporting employee income earned in the year 2012.  For more information, see: http://www.shrm.org/LegalIssues/FederalResources/Pages/W2Reporting.aspx  The United States Treasury Department and the IRS anticipate issuing guidance on this reporting requirement before the end of this year, so stay tuned for updates!

DOL STRATEGIC PLAN FOCUSES ON MISCLASSIFIED WORKERSThe national five year strategic plan for the United States Department of Labor (DOL) includes plans for an increased crackdown on employer who misclassify workers as independent contractors instead of as employees.  DOL plans to work jointly with the United States Department of Treasury (i.e. the IRS) to “detect and deter” such misclassifications, which DOL says occur in as many as 30% of US employer and deprives the federal treasury of “billions” of dollars.  Another interesting note, according to the strategic plan: “the FLSA recordkeeping regulations under development will require that covered employers notify each of their workers of their rights under the FLSA, and provide employees with information regarding their hours worked and wage computations.”  You can read the full plan (reader warning…it is over 100 pages long) at: http://www.dol.gov/_sec/stratplan/StrategicPlan.pdf

NEW FINANCIAL INSTITUTION DIVERSITY REQUIREMENTS:  Banks, credit unions and various other financial institutions face new diversity requirements as a result of the passage of the federal financial reform law in July of 2010.  The news law requires the federal agencies affected (Treasury, FDIC, Federal Reserve, National Credit Union Administration, etc.) to establish an office of minority and women inclusion to promote equal employment opportunity and diversity within the regulated financial institutions.  Contractors working with such agencies will have to agree, in their contracts, to fairly include women and minorities in their workforces.  Here are links to a couple of resource articles explaining these requirements in more detail:  http://www.shrm.org/hrdisciplines/Diversity/articles/pages/federalagencydiversity.aspx and http://www.dcemploymentlawupdate.com/2010/07/articles/federal-contracts-1/financial-reform-bill-establishes-diversity-requirements/

SOME NEW CALIFORNIA EMPLOYMENT LAWS:  National SHRM has a helpful article on its website about some new employment laws taking effect in California, including a new paid leave requirement for organ donation.  Here is a link to the article: http://www.shrm.org/LegalIssues/StateandLocalResources/Pages/CalifEnactsNewEmploymentLaws.aspx  Some headline highlights from the article include: (1) “California law previously entitled state employees who had exhausted available sick leave to take up to 30 days paid leave for donating organs to another person, and up to five days paid leave for donating bone marrow to another person. Known as the Michelle Maykin Memorial Donation Protection Act, SB 1304 adds a new Labor Code provision extending this public employee benefit to private employees. Private employers with 15 or more employees will be required to provide up to 30 days of paid leave per year for an organ donation in any one-year period, and up to five days of paid leave per year for a bone marrow donation. Leave may be taken in one or more periods.” (2) “California law provides unemployment insurance benefits to eligible employees who are unemployed through no fault of their own. Until passage of AB 2364, these provisions contained a 'good cause' exception allowing employees to retain their eligibility if they left employment to protect their 'children' from domestic violence abuse. AB 2364 amends this domestic violence 'good cause' exception to specify that an employee retains their eligibility if they voluntarily left employment to protect their 'family' (not simply 'children' as under prior law) from domestic violence abuse.” (3) “AB 569 amends California Labor Code § 512 to exempt the following categories of employees (as defined by the statute) from the meal period provisions otherwise applicable to nonexempt employees: construction occupation, commercial drivers, security officers, gas and electrical corporation employees and those of a publicly-owned local electric utility. The exemption applies only to such employees covered by a valid collective bargaining agreement that expressly provides for the wages, hours of work, and working conditions of employees, which expressly provides for meal periods for those employees, for final and binding arbitration of disputes concerning application of its meal period provisions, for premium wage rates for all overtime hours worked, and a regular rate of pay of not less than 30 percent more than the state minimum wage rate.” 

REMEMBER VOTING INTEGRITY AND ELECTION LEAVE STATE LAWS:  As election day 2010 approaches, keep in mind that some state laws regulate an employer’s efforts to influence the votes of its employees.  Other state laws require that employers allow time off for employees to vote if their work shifts would preclude them from voting.  Here are a couple of links to various state voting leave laws: http://www.shrm.org/LegalIssues/StateandLocalResources/StateandLocalStatutesandRegulations/Documents/statevotinglaw.pdf and http://www.wileyrein.com/resources/documents/fm14049.pdf   Utah’s voting leave law states as follows: “(1) (a) Each employer shall allow any voter to be absent from service or employment on election day for not more than two hours between the time the polls open and close. (b) The voter shall apply for a leave of absence before election day. (c) (i) The employer may specify the hours during which the employee may be absent. (ii) If the employee requests the leave of absence at the beginning or end of the work shift, the employer shall grant that request. (d) The employer may not deduct from an employee's usual salary or wages because of the absence. (2) This section does not apply to an employee who has three or more hours between the time polls open and close during which the employee is not employed on the job. (3) Any employer who violates this section is guilty of a class B misdemeanor.”  Utah law also makes it a criminal misdemeanor for an employer to try to influence an employee’s vote, stating, “It is unlawful for any corporation, or any officer or agent of any corporation, to influence, or attempt to influence, induce, or compel by force, violence, or restraint, or by inflicting or threatening to inflict any injury, damage, harm, or loss, or by discharging from employment or promoting in employment, or by intimidation, or in any manner whatever, any employee to vote or refrain from voting at any election provided by law, or to vote or refrain from voting for any particular person or measure at that election.”  Similarly, Utah law also provides as follows: “It is unlawful for any employer, corporation, association, company, firm, or person to:(i) enclose their employees' salary or wages in envelopes on which there is written or printed any political mottoes, devices, or arguments containing threats, express or implied, intended or calculated to influence the political opinion, views, or action of the employees; or (ii) within 90 days of any election provided by law to put up, or otherwise exhibit, in its, their, or his factory, workshop, mine, mill, boarding house, office, or other establishment or place where employees may be working or be present in the course of employment, any handbill, notice, or placard containing any threat, notice, or information, that if any particular ticket or candidate is or is not elected: (A) work in the establishment will cease in whole or in part; (B) the establishment will be closed; (C) wages of workmen be reduced; or (D) other threats, express or implied, intended or calculated to influence the political opinions or actions of employees.”

Written by: Employment Attorney, Michael Patrick O'Brien
Utah State and Salt Lake SHRM legal director
Email: mobrien@joneswaldo.com
Phone: 801-534-7315
Website: www.joneswaldo.com

Legal-mail is a legal and legislative update service sent out about twice a month to various Utah SHRM members and chapters. As a courtesy to SHRM, the Utah law firm of Jones Waldo Holbrook & McDonough P.C. underwrites the costs of the service. If you have any questions or comments, please contact Michael Patrick O'Brien.

Disclosure: These updates are merely updates and are not intended to be legal advice. Receipt of this information does not create an attorney-client relationship.