Benefit Plan Limits - 2024
Commonly used indexed numbers for Qualified Retirement Plans.
Commonly used indexed numbers for Qualified Retirement Plans.
Benefit Plan Limits - 2023
Commonly used indexed numbers for Qualified Retirement Plans.
Commonly used indexed numbers for Qualified Retirement Plans.
HERO Act
New York’s Health and Essential Rights Act – referred to as the NY HERO Act - is in effect now and applies to nearly all New York employers, regardless of size. The purpose of the law is to protect employees in the event of an outbreak of an airborne infectious disease. There was a delay in doing so, but New York now has designated COVID-19 as an airborne infectious disease under the law.
In light of the designation, covered employers who have not done so already must do the following, now:
Establish a written Exposure Prevention Plan. While employers can create their own plans in accordance with the law’s requirements, the NYS Department of Labor has provided model plans for use. Model plans for specific industries can be found here, at the bottom: https://dol.ny.gov/ny-hero-act. A more general model plan, applicable to most office environments, is here: https://dol.ny.gov/system/files/documents/2021/07/model-airborne-infectious-disease-exposure-prevention-plan-p765.pdf. The plan must be included in the employer’s employee handbook, if it has one; be provided to each employee; be posted in a visible and prominent location in the workplace; and be accessible to employees during all shifts.
Designate at least one supervisory-level employee to enforce the Exposure Prevention Plan in the event that an infectious disease designation is made by the State, which, again, now has occurred with respect to COVID-19.
If the Exposure Prevention Plan was established previously, review and update it, if necessary, to ensure that it incorporates current information, guidance, and mandatory requirements issued by Federal, State, or local authorities.
Promptly provide a verbal review of the Exposure Prevention Plan to employees. The supervisory employee who conducts the review must verbally inform (either in person or by telephone) all employees of the Plan’s existence and where it is physically located in the workplace. We strongly recommend documenting the “verbal review” by having employees sign an “attendance sheet” confirming that each employee was advised of the Plan’s existence, location, and substance.
So long as the designation of an airborne infectious disease is in effect, a covered employer must:
Monitor and maintain exposure controls; and
Regularly check for updated information from the NYS Department of Health and the CDC, and update the Exposure Prevention Plan as necessary to reflect that information.
Employers may have heard that the new law also requires the establishment of a “joint labor-management workplace safety committee,” comprising employer-designees and employees. That requirement does not go into effect until November, and we expect to see regulatory guidance between now and then.
Where things stand with the FFCRA tax credits; the new COBRA subsidy.
As the pandemic (hopefully) continues to wind down, we have continued to field questions regarding paid leave for COVID-19 related reasons, and whether that leave might be reimbursable to the employer. The short answer is that reimbursement remains a possibility.
Readers of our bulletins may recall that the Families First Coronavirus Response Act (FFCRA) required the provision of certain paid leave, which if properly documented would be reimbursed to the employer dollar-for-dollar via a credit on payroll taxes. Readers also may recall that the Federal requirements to provide paid leave expired on December 31, 2020.
The bottom line at the current time is that, per the American Rescue Plan Act (ARPA) signed by President Biden earlier this year, employers with fewer than 500 employees still may voluntarily provide FFCRA leave, and the tax credit lives on. That will be the case through September 30, 2021, and applies to wages paid between April 1 and September 30. (FFCRA leave provided between January 1 and March 30 was treated slightly differently; for purposes of this bulletin, we are addressing only the current time.)
The original six reasons why FFCRA leave may be provided are unchanged – specifically, that the employee is unable to work, including telework, because the employee:
Is subject to a Federal, State, or local quarantine or isolation order related to COVID-19;
Has been advised by a health care provider to self-quarantine related to COVID-19;
Is experiencing COVID-19 symptoms and is seeking a medical diagnosis;
Is caring for an individual subject to an order described in (1) or self-quarantine as described in (2);
Is caring for his or her child whose school or place of care is closed (or child care provider is unavailable) due to COVID-19 related reasons; or
Is experiencing any other substantially-similar condition specified by the U.S. Department of Health and Human Services.
The ARPA has added three additional reasons:
The employee is obtaining a COVID-19 vaccine;
The employee is recovering from an illness or complications related to having obtained a COVID-19 vaccine;
The employee is seeking or awaiting the results of a diagnostic test or medical diagnosis regarding COVID-19, when the employee has been exposed or the employer has requested the test of diagnosis.
Please note that while the various reasons for FFCRA leave previously were grouped into Emergency Paid Sick Leave and Emergency Family Medical Leave, the ARPA essentially has dissolved the distinction and has consolidated the reasons for leave for purposes of the amount of leave available (generally up to 12 weeks). That said, there still are distinctions among types and amounts of leave for purposes of the amount of the allowable tax credit.
Separately, the six-month COBRA subsidy period provided under the ARPA started on April 1. The U.S. Department of Labor has published information to help employers comply with the subsidy rules, including information on how to claim the associated tax credit and updated model COBRA forms, here: https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/cobra/premium-subsidy-for-employers-and-advisers.
Qualified Retirement Plans: Welcome Relief for Employers that Hire Employees by March 31, 2021
401(k) and other qualified retirement plans require that, when a plan terminates or experiences a “partial termination,” the benefits of all affected participants must be fully vested. The law provides that whether a partial termination has occurred is determined based on all of the facts and circumstances, but IRS has established that a 20% or greater turnover rate among employees participating in the plan establishes a presumption that the plan did partially terminate and the full vesting rule will apply. The Consolidated Appropriations Act, 2021 (the “CAA”) provides relief from this vesting rule where the number of active participants covered by a partially terminated plan on March 31, 2021 is at least 80% of the number of active participants covered by the plan on March 13, 2020. If you reduced your workforce significantly after March 13, 2020 and are planning to increase your employment rolls, have your plan’s TPA run the numbers for you to see if you can take advantage of this rule, and call us if you need help.
New York and New Jersey EOY Employment Law Reminders and Updates
As this difficult year comes to a close, employment laws in New York and New Jersey are continuing to expand and change. We are providing select EOY reminders and updates, as follows:
If you have employees in New York:
Minimum Wage and Overtime Update:
Minimum Wage: Effective December 31, 2020, the minimum wage in New York State generally will be:
In New York City: $15.00 per hour;
In Nassau, Suffolk, and Westchester counties: $14.00 per hour;
In the remainder of New York State: $12.50 per hour.
Exemptions from Overtime: In order for an employee to be exempt from (i.e., not entitled to) overtime pay (i.e., time and one half the employee’s regular rate for hours worked over 40 in a workweek), several requirements generally must be met. One of those requirements is that the employee is paid on a “salary basis,” and the salary must be at least a particular “floor.” Effective December 31, 2020, the “floor” in New York State, for employees subject to the “executive” and “administrative” exemptions from overtime, generally will be:
In New York City: $1,125 per week ($58,500 annually);
In Nassau, Suffolk, and Westchester Counties: $1,050 per week ($54,600 annually);
In the remainder of New York State: $937.50 per week ($48,750 annually).
Please recall that while New York does not have a salary “floor” for employees subject to the “professional” exemption, there is a Federal threshold that generally applies. It remains $684 per week ($35,568 annually).
New York Paid Family Leave:
Effective January 1, 2021, eligible employees may take up to 12 weeks of job-protected leave; the maximum benefit amount will increase to 67% of an employee’s average weekly wage rate, up to a maximum of $971.61 per week.
The increased maximum benefit amount will result in a higher payroll deduction. (Recall that paid family leave is funded by employee contributions to a paid family leave rider that employers must have on their temporary disability insurance plans.) We recommend that employers confirm with their insurers and payroll providers that all is in order.
New York’s model “Employee Notice of Paid Family Leave Payroll Deduction,” and “Statement of Rights for Paid Family Leave,” are available at the Employer Resources tab here: https://paidfamilyleave.ny.gov/2021.
New York COVID Leave:
As things stand, the Federal Families First Coronavirus Response Act (FFCRA) will expire as planned on December 31, 2020. Through March 31, 2021, employees still voluntarily may offer certain leave under the law and claim the related tax credit, but doing so no longer will be mandatory. However, New York’s own COVID-19 Paid Sick Leave law will remain in effect, and employees also may have recourse to New York Paid Family Leave and statutory disability benefits for this purpose, among other rights under Federal, State, and local law (including paid sick leave under NYS/NYC law). General information can be found here: New Paid Leave for COVID-19 | Paid Family Leave (ny.gov); and summarized more briefly here: COVID-19 Paid Sick Leave - Information for Employers (ny.gov).
Paid Safe and Sick Leave:
The particulars are well beyond the scope of this email, but please be reminded that New York State’s new Paid Sick Leave Law, and New York City’s amendments to its pre-existing Earned Safe and Sick Time Act (ESSTA), have significantly changed the rules for 2021.
If you have employees in New Jersey:
Minimum Wage and Overtime Update: Effective January 1, 2021, the minimum wage in New Jersey generally will be $12.00 per hour.
But, for employees of seasonal or small employers (i.e. employers with less than 6 employees): $11.10 per hour.
The current “Wage and Hour Abstract” poster, reflecting the above, is here: http://lwd.dol.state.nj.us/labor/lwdhome/content/employerpacketforms.html.
With respect to overtime, in order for an employee to be exempt from (i.e., not entitled to) overtime pay (i.e., time and one half the employee’s regular rate for hours worked over 40 in a workweek), several requirements generally must be met. One of those requirements is that the employee is paid on a “salary basis,” and the salary must be at least a particular “floor.” New Jersey continues to follows the Federal overtime rules; as such, the “floor” generally remains $684 per week ($35,568 annually).
New Jersey COVID Leave:
As things stand, the Federal Families First Coronavirus Response Act (FFCRA) will expire as planned on December 31, 2020. Through March 31, 2021, employees still voluntarily may offer certain leave under the law and claim the related tax credit, but doing so no longer will be mandatory. However, employees still also may have recourse to New Jersey Family Leave Insurance and to statutory disability benefits for this purpose, among other rights under Federal, State, and local law (including the New Jersey Earned Sick Leave Law). The New Jersey Department of Labor & Workforce Development released a helpful one-sheet guide for employers considering COVID-related leave scenarios, here: https://www.nj.gov/labor/assets/PDFs/COVID-19%20SCENARIOS.pdf. Please just note that the document is outdated in that it continues to include the FFCRA. Our hope is that a 2021 version will be released soon.
Insurance Contribution Rates:
As a reminder, beginning January 1, 2021, payroll deductions will increase for both Family Leave Insurance (paid for by employee contributions) and Temporary Disability Insurance (paid for by employer and employee contributions). We recommend that employers confirm with their insurers and payroll providers that all is in order.
Yearly Reminders:
At this link http://lwd.dol.state.nj.us/labor/lwdhome/content/employerpacketforms.html you can find the “CEPA (Whistleblower)” notice. In addition to posting the notice as all New Jersey employers must, employers with 10 or more employees must distribute it to their employees annually. There is no particular requirement re: memorializing having done so, but we suggest that employers do so. The “Contact Information” section at the bottom of the notice must be completed.
Employers with 50 or more employees must, in addition to posting the “Gender Equity Notice” found at the same link and providing a copy at the time of hire, also must distribute the notice annually. The acknowledgment at the bottom must be signed, and the signed form must be returned to the employer within 30 days of an employee’s receipt of it
Employment Law Bulletin - New York sick leave update and action items
Per our bulletin earlier this month, New York State recently passed a statewide sick leave law. The State just has begun to release guidance (found here https://www.ny.gov/new-york-paid-sick-leave/new-york-paid-sick-leave#amount-of-leave; please note the FAQs at the bottom) beyond the actual text of the law. In the meantime, though, New York City amended its own, preexisting safe/sick leave law, both in part to match certain elements of the State law, but also to add brand new requirements with which employers must comply in short order. We highlight three of them here.
First, employers must list on employees’ paystubs (or any document issued each pay period) the amounts of accrued and used sick leave and the total balance of accrued leave. This requirement is in effect now, but employers working in good faith on implementation generally have until November 30 to comply. (Please note: even outside of New York City, the new State law also requires that an employer’s payroll records include the amount of sick leave accrued and used by each employee on a weekly basis.)
Second, the amended law requires employers to distribute to employees a notice of the law with its new amendments, and also to conspicuously post the notice at the employer’s place of business in an area accessible to employees. The City has released a model notice, here: https://www1.nyc.gov/assets/dca/downloads/pdf/about/PaidSafeSickLeave-MandatoryNotice-English.pdf. Three important points regarding this new notice: (1) it appears to replace the prior NYC Earned Safe and Sick Time Act notice that employers have been distributing to new hires for years; (2) to reiterate, unlike the prior notice, this new notice must be distributed to employees and must be posted; and (3) finally, although the text of the law is less than clear (and there is an apparent discrepancy on the City’s own website), the safest reading is that the new notice must be given to current employees and posted by October 30. Employees whose primary languages are other than English will need to receive a copy in their primary languages, but that requirement is pending the City releasing translated notices (which it has not yet done).
Third, effective immediately, while an employer still may require certain documentation (such as a note from a licensed medical provider, attesting to both the existence of a need for sick leave and the amount of work hours or days used as sick leave) from an employee after more than three consecutive days of leave, the employer now must reimburse the employee for any cost of obtaining the documentation.
Employment Law Reminder - Election Requirements
As may be familiar from our alert before the primary elections in June, New York has particular requirements regarding employee time off to vote. There also is a notice requirement effective Tuesday, October 20th for most employers, explained below. The requirements are as follows:
An employee who is a Registered Voter is entitled to time off to vote, without a loss of pay, if the employee does not have sufficient time to vote outside of his/her scheduled working time. An employee has “sufficient time” to vote if s/he has 4 consecutive hours either between the opening of polls and the beginning of his/her working shift, or between the end of his/her working shift and the closing of the polls.
Example: if polls are open until 9:00 p.m. and an employee is scheduled to work from 9:00 a.m. to 5:00 p.m., the employee has sufficient time to vote, because s/he has 4 consecutive hours from 5:00 p.m. through 9:00 p.m. to do so. Thus, the employee is not eligible for time off from work to vote.
If an employee does not have sufficient time to vote as explained above, then s/he may take off only as much time as is required to vote, up to a maximum of 2 hours, without any loss of pay. The employer may designate whether time off is provided at the beginning or end of the employee’s shift, and does not have to provide time off mid-shift.
Employers must conspicuously post a notice setting forth the provisions of the law, at least 10 working days before the election and until the close of polls on election day. For employers who are not open on weekends, that means by Tuesday, October 20th to be timely for the November 3rd election. A copy of the notice is here: https://www.elections.ny.gov/NYSBOE/elections/TimeOffToVoteNotice.pdf. Unfortunately, as of this writing, it does not appear that the Board of Elections has provided any guidance in terms of the posting requirement and employees who are working remotely, as many are due to the COVID-19 pandemic. As such, we only can assume that it will be sufficient to email remote employees the link to the notice, with a note that they should (1) follow the link; (2) review its contents in full; (3) direct any questions to Human Resources or another suitable employer designee; and (4) confirm receipt of the email.
An employee who requires working time off to vote must notify the employer at least 2 working days, but no more than 10 working days, prior to the election.
Bulletin: New York State Sick Leave, new FMLA forms, and New Jersey Misclassification Poster
New York State Sick Leave Law.
For New York employers only: Effective September 30, 2020, New York's new statewide sick leave law went into effect, and employees began accruing sick time as of that date (although employers may choose to not permit use of the accrued sick time until January 1, 2021). The good news is that, for employers located in New York City or Westchester County, the new statewide law for the most part does not depart substantially from the local sick leave laws that have been in effect for several years. However, some significant differences already are apparent, and the bad news is that the state has not yet released any regulatory guidance, leaving many questions unanswered. Regardless, New York City and Westchester employers should update their sick leave policies, and employers outside of those locations will need new policies, in very short order. We regularly assist with drafting and administering these types of policies.
New Family Medical Leave Act (FMLA) forms.
The US Department of Labor has released updated forms for use by covered employers (generally, those with 50 or more employees at or within 75 miles of the worksite) in complying with the FMLA. They are available here: https://www.dol.gov/agencies/whd/fmla/forms. These include, among others, the Notice of Eligibility & Rights and Responsibilities, provided to an employee at the time of a request for FMLA leave, and the Designation Notice, used to confirm that the requested leave in fact will be deemed FMLA-qualifying.
Our philosophy generally is that if the government provides model forms, employers ought to use them, and these new forms are convenient (unlike in the past) in that they may be completed and saved electronically. However, we do suggest that employers consider preparing their own forms based on these new templates, without the portions that are unnecessary and not required by law. (For example, there is no reason for the employee receiving the forms to see the instructions to the employer.)
The rules regarding notice and information under the FMLA are complex. We regularly assist employers in the preparation and proper use of the required FMLA forms.
New Jersey "misclassification" poster.
For New Jersey employers only: The NJ Department of Labor and Workforce Development has issued a required poster, addressing the matter of employees who are misclassified as independent contractors, and found here: https://www.nj.gov/labor/forms_pdfs/lsse/mw-899_520_missclassification11x17.pdf. The poster must be posted "in a place or places accessible to all employees in each of the employer's workplaces." For employers who have not yet reopened for in-person work, to whom the poster should be transmitted and how are matters to discuss with counsel.
New Jersey's assault on employers who utilize the services of individual independent contractors continues unabated. We strongly recommend that employers read the misclassification poster in full, and consider whether its contents may require reconsidering the classification of any independent contractors previously or currently engaged.
Employment Law Alert: Reopening resources, with a side of voting and marijuana
Employee Voting in New York
New York State has changed the law in this regard for the second time in as many years, returning to the pre-2019 law. The change affects employee rights with respect to the June 23 primary elections. There is a posting requirement effective June 9, 2020 for most employers, explained below. The law and requirements are as follows:
A Registered Voter is entitled to time off to vote, without a loss of pay, if the Registered Voter does not have sufficient time to vote outside of his/her scheduled working time. An employee has such “sufficient time” if s/he has four (4) consecutive hours either between the opening of polls and the beginning of his/her working shift, or between the end of his/her working shift and the closing of the polls.
Example: if polls are open until 9:00 p.m. and an employee is scheduled to work from 9:00 a.m. to 5:00 p.m., the employee has sufficient time to vote. Thus, the employee is not eligible for time off from work to vote.
If the employee does not have sufficient time to vote as explained above, then s/he may take off only as much time as is required to vote, up to a maximum of 2 hours, without any loss of pay. The employer may designate whether time off is provided at the beginning or end of the employee’s shift, and does not have to provide time off mid-shift.
Employers must conspicuously post a notice setting forth the provisions of the law, at least 10 days before every election and until the close of polls on election day. For employers who are not open on weekends, that means by June 9, 2020 to be timely for the June 23rd primaries. A copy of the poster is on the second page here: https://www.elections.ny.gov/NYSBOE/elections/TimeOffToVoteNotice.pdf.
An employee who requires working time off to vote must notify the employer at least 2 working days but no more than 10 working days prior to the election.
We note that due to the pandemic, Governor Cuomo’s executive orders have relaxed the rules regarding absentee ballots. We have sought guidance from the Board of Elections on the effect of those orders on the requirements above, and have not received a response. We recommend seeking individualized guidance regarding what questions may be asked of employees in this regard, and what documentation may be requested.
Pre-Employment Marijuana Screening in New York City
Effective now, New York City employers generally are prohibited from testing prospective employees for the presence of marijuana or tetrahydrocannabinols as a condition of employment. There are limited exceptions including, among others, with respect to positions requiring a commercial driver’s license; or requiring the supervision or care of certain children, medical patients, or vulnerable persons.
Reopening Resources in New York and New Jersey
As all parts of the States currently are in various stages of reopening, we are providing the below list of resources regarding reopening plans. As the materials have become voluminous and different rules affect different industries, businesses should obtain individualized guidance. We note that industry-specific guidance issued by trade or professional associations/organizations may provide a useful “short cut” to gathering all of the material for particular industries, but also may not be a substitute for individualized guidance.
New Jersey Resources:
NJ FAQs about Phased Reopening: https://covid19.nj.gov/faqs/nj-information/general-public/how-does-new-jersey-plan-to-lift-restrictions-what-does-a-responsible-and-strategic-restart-of-new-jerseys-economy-look-like
NJ Executive Orders (many details of reopening particular industries are contained here): https://nj.gov/infobank/eo/056murphy/approved/eo_archive.html
NJ Division of Consumer Affairs – Guidance for Healthcare Professionals: https://www.njconsumeraffairs.gov/COVID19/Pages/professionals.aspx
NJ Department of Health Guidance on Resuming Elective Surgeries: https://www.nj.gov/health/news/2020/approved/20200519a.shtml
NJ Division of Consumer Affairs – Guidance regarding Other Licensees and Registered Businesses (Non-Healthcare): https://www.njconsumeraffairs.gov/COVID19/Pages/professionals.aspx
New York Resources:
NY’s Reopening Plans: https://forward.ny.gov/ny-forward
To determine whether your business is eligible to reopen, NY’s interactive tool is here: https://www.businessexpress.ny.gov/app/nyforward
Guidelines for various industries permitted to reopen in Phase 1: https://forward.ny.gov/phase-one-industries
Guidelines for various industries permitted to reopen in Phase 2: https://forward.ny.gov/phase-two-industries
Statewide guidance on various industries and services: https://forward.ny.gov/statewide-guidelines. Please note after you have read the guidance, that the business designee should sign, affirming that it is operating according to such guidance and other specific health and safety requirements issued for the industry. Business affirmation webpages can be found at the above link or here: https://forms.ny.gov/s3/ny-forward-affirmation.
In order to reopen when appropriate, as designated by NY’s phased reopening plans, each business must develop a Safety Plan which must be maintained on-site and be made available to the NY Department of Health or other local health official, if requested. NY has developed template plans for businesses to use, and a list of resources that may address industry-specific issues/obstacles. The general Safety Plan Template is found here: https://www.governor.ny.gov/sites/governor.ny.gov/files/atoms/files/NYS_BusinessReopeningSafetyPlanTemplate.pdf
FAQs regarding New York Forward and business reopening: https://esd.ny.gov/nyforward-faq
Other Resources:
The following supplement the resources for best safety and health practices upon reopening, and may provide additional resources for specific industries.
CDC: https://www.cdc.gov/coronavirus/2019-ncov/communication/guidance-list.html?Sort=Date%3A%3Adesc
OSHA: https://www.osha.gov/SLTC/covid-19/index.html. Pease note: OSHA also has issued separate guidance for different industries: https://www.osha.gov/SLTC/covid-19/ and https://www.osha.gov/SLTC/covid-19/controlprevention.html#interim
Employment Law Alert: new Form I-9 and Form 1099-NEC
The new Form I-9 must be used starting May 1, 2020:
U.S. Citizenship and Immigration Services (USCIS) has updated Form I-9, used to verify eligibility to work in the United States. The latest version is found here: https://www.uscis.gov/i-9. Please note that, although the USCIS site references using this new version effective January 31, 2020, the prior version is acceptable through April 30, 2020. Effective May 1, 2020, the new version must be used when an employer completes the verification process for a new employee (and for reverification when necessary).
Updated instructions also may be found at the above link. Although the substantive changes to the form and instructions are not extensive, two items from the new instructions are worth noting:
The instructions now specifically provide that, even though an authorized representative may act on the employer’s behalf to complete Section 2 of the form, the employer is liable for any violation in connection with the form and the verification process. The message: choose your authorized representative wisely.
Also regarding Section 2 of the form, if the employee produces a document or documents satisfying List A, the employer should not write “n/a” or anything else in the List B or C sections.
Penalties for failure to complete, or violations in completing, Form I-9 can be steep – up to $2,292 per employee with respect to whom the violation has occurred.
Form 1099-NEC – the remix:
The IRS recently revived Form 1099-NEC (Nonemployee Compensation), last seen in 1982. As of tax year 2020, payments of $600 or more to independent contractors must be reported on Form 1099-NEC, as opposed to Form 1099-MISC as has been the case for the past few decades. Businesses should consult with their tax professionals regarding the use of the form, but we address it here in the context of continuing to warn employers about misclassifying employees as independent contractors.
The ostensible explanation for bringing back Form 1099-NEC is to resolve a filing date discrepancy. Since 2015, a Form 1099-MISC concerning nonemployee compensation had to be filed by January 31, while a Form 1099-MISC concerning certain other types of payments had to be filed by February 28. Reintroducing Form 1099-NEC takes nonemployee compensation out of Form 1099-MISC entirely. However, if you believe that the preceding was the only motivation for the change, we have a bridge, and we’d love to sell it to you. The reintroduction of Form 1099-NEC means that there now is a form dedicated solely to tracking payments to purported independent contractors, an issue over which the Federal and State governments have been rabid over the past decade, for a simple reason: money. Identifying employees who were misclassified as independent contractors permits the government to pursue unremitted payroll taxes, and to assess those taxes going forward. If your business relies on independent contractor services, we strongly recommend confirming their proper classification with legal counsel.
Employment Law Alert re: COVID-19 - Update
This brief alert follows up on our prior alert regarding the Families First Coronavirus Response Act. We noted in our prior alert that the U.S. Department of Labor would be releasing a poster regarding employee rights under the Act, and it since has done so. You can find a copy of the poster for private employers here: https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf.
Please note that the posting mandatory. The poster must be put up in a conspicuous place on the employer’s premises, although the posting requirement also may be satisfied by (among other things) emailing or direct mailing the poster to employees. We recommend posting the poster on premises (presuming that the employer’s premises are open at this time) and emailing a copy to employees who are working remotely or who are furloughed or otherwise not working at all. The poster does not need to be provided to employees who have been laid off or whose employment otherwise has been terminated. Please note in that regard that a furlough and a layoff are not the same thing – we have seen quite a bit of confusion over that point in the past few weeks.
You can find FAQs regarding the posting requirement here: https://www.dol.gov/agencies/whd/pandemic/ffcra-poster-questions. Employers with large premises that remain open should take particular note of the final two questions and answers.
The U.S. Department of Labor also has released new FAQs on the Act generally, found here: https://www.dol.gov/agencies/whd/pandemic/ffcra-questions. We have received a number of questions regarding the potential exemption from the emergency family leave requirement (and one particular portion of the emergency paid sick time requirement), for businesses with fewer than 50 employees. As such, we found FAQ No. 4 to be interesting. It appears that qualifying for the exemption essentially will be on an “honor system,” subject to regulations that still are forthcoming. That said, the standard to be met for the exemption, from the text of the Act alone, is very high, and we don’t recommend treating it lightly, particularly given the significant danger of an employee complaint in light of the promotion of the new laws in the media.
Finally, in further follow up to our prior alert, we presume that readers are unavoidably aware of the recent “stay at home” orders put in place in New York and New Jersey. We are happy to address questions regarding employer operations in light of those orders.
Employment Law Alert re: COVID-19
Effective on April 2, 2020, the Families First Coronavirus Response Act (the “Act”) provides two different benefits for eligible employees: (1) emergency paid sick leave; and (2) emergency family leave. These provisions expire on December 31, 2020.
Please note that the cost of both paid sick leave and emergency family leave under the Act is to be reimbursed to the employer by way of certain tax credits. We are not addressing the specifics of the tax credits in this alert, but are happy to respond to any questions that you may have.
Emergency Paid Sick Leave:
Who is covered?
This portion of the Act generally applies to private employers with less than 500 employees, and to all employees regardless of length of service. However, an employer of a health care provider or an emergency responder may choose to exclude such an employee from using paid sick time under the Act.
When can paid sick time be used?
An employee must be provided with paid sick time if the employee is unable to work (or telework) due to any of the following:
1. The employee is subject to a Federal, State, or local quarantine or isolation order related to COVID-19.
2. The employee has been advised by a health care provider to self-quarantine due to concerns related to COVID-19.
3. The employee is experiencing symptoms of COVID-19 and is seeking a medical diagnosis.
4. The employee is caring for another individual as described in 1 or 2 above.
5. The employee is caring for the employee’s child because the child’s school or place of care has been closed, or the childcare provider of the child is unavailable, due to COVID-19 precautions.
6. The employee is experiencing any other condition substantially similar to the above, as determined by certain Federal agencies.
How much paid sick time must an employee be given, and how is it paid?
A full-time employee is eligible for up to 80 hours of paid sick time. A part-time employee is eligible for paid sick time in the number of hours that the employee works, on average, in a two-week period.
The government is to provide more guidance on calculating the value of paid sick time, but generally an hour of paid sick time will be paid at the employee’s regular rate of pay. However, there are certain caps. If an employee uses paid sick time for reasons 1, 2, or 3 above, the value of paid sick time is capped at $511 per day, or $5,110 in the aggregate. If an employee uses paid sick time for reasons 4, 5, or 6 above, the value of paid sick time is capped at two-thirds (2/3) of the employee’s regular pay, up to $200 per day or $2,000 in the aggregate.
What rules apply to the use of paid sick time?
Generally:
After the first day of work (or partial day of work) for which an employee receives paid sick time, the employer may require the employee to follow reasonable notice procedures in order to continue receiving paid sick time.
An employer cannot require an employee to use any other type of paid leave (such as paid vacation) before using paid sick time under the Act. Paid sick time under the Act is in addition to any other paid time off available by law or employer policy.
An employer cannot require an employee who uses paid sick time to find coverage or a replacement for the employee’s shift.
Paid sick time not used by December 31, 2020 is forfeited.
Is there anything else to know about paid sick time?
The above is a summary intended to be helpful and does not address each and every provision of the law. However, please note that the law does contain anti-retaliation provisions, and that there will be a posting requirement. Allegedly, the government will provide a model poster by March 25, 2020.
Emergency Family Leave:
Who is covered?
This portion of the Act also generally applies to private employers with less than 500 employees, although employers with less than 50 employees may seek an exemption if compliance would jeopardize the viability of the business. However, an employer would make the application under regulations that as of yet haven’t been released.
To be eligible for leave, an employee must have been employed for at least 30 days. However, an employer of a health care provider or an emergency responder may choose to exclude such an employee from taking leave.
When can an employee take emergency family leave, and for how long?
An eligible employee can take up to 12 weeks of leave if the employee is unable to work (or telework) due to a need for leave to care for the employee’s minor child, if the child’s school or place of care has been closed, or the child care provider of the child is unavailable, due to a COVID-19 related emergency declared by a Federal, State, or local authority.
What rules apply to the use of emergency family leave? Is the leave paid?
Generally:
If the need to use emergency family leave is foreseeable, an Employee must provide notice as soon as practicable.
The first 10 days of emergency family leave are unpaid. (However, paid sick time, as described above, may be applicable.)
In addition to sick time as described above, an employee may use any other paid leave available (such as paid vacation) to cover the 10 days of otherwise unpaid leave, but cannot be required to do so.
After the initial 10 days, the employer must pay the employee two-thirds (2/3) of their regular rate of pay for the number of hours they would otherwise be regularly scheduled to work, were they not on leave. (There is a formula for employees who have varying weekly schedules.) However, the pay is capped at $200 per day and $10,000 in the aggregate.
Generally, an employee who takes emergency family leave is entitled to be restored to the same or an equivalent position upon returning from leave. However, the employee is not entitled to job restoration if:
The employer has less than 25 employees;
The employee’s position no longer exists due to economic conditions or other changes in the employer’s operating conditions that (i) affect employment; and (ii) are caused by a COVID-19 related public health emergency;
The Employer makes reasonable efforts to restore the employee to an equivalent position (with equivalent benefits, pay, and other terms and conditions of employment); and
If the reasonable efforts fail, the employer makes reasonable efforts for one year to contact the employee if an equivalent position becomes available.
For New York Employers:
New York State has passed emergency legislation, effective immediately, guaranteeing job protection and certain paid sick time for an employee who is under a mandatory or precautionary quarantine order due to COVID-19. Although not entirely clear, it appears that these protections are in addition to the Federal protections described above, as well as local paid sick leave laws (such as the New York City Earned Safe and Sick Time Act).
You can find information, including helpful FAQs, here: https://www.governor.ny.gov/paid-sick-leave-covid-19-impacted-new-yorkers/emergency-covid-19-paid-sick-leave
A brief summary for employers is here: https://www.governor.ny.gov/sites/governor.ny.gov/files/atoms/files/COVID_Sick_Leave_Employers_3-18-20_1.pdf
Finally, Governor Cuomo has signed an executive order mandating that telecommuting and work from home procedures be utilized to the greatest extent possible, and that in any event most businesses reduce the in-person workforce at any work location by 75%. It is not clear how, and to what extent, this will be enforced.
New York and New Jersey EOY Employment Law Reminders and Updates
If you have employees in New York:
Minimum Wage and Overtime Update:
Minimum Wage: Effective December 31, 2019, the minimum wage in New York State generally will be:
In New York City: $15.00 per hour;
In Nassau, Suffolk, and Westchester counties: $13.00 per hour;
In the remainder of New York State: $11.80 per hour.
Exemptions from Overtime: In order for an employee to be exempt (i.e. not entitled) from premium overtime pay (i.e. time and one half the employee’s regular rate for hours worked over 40 in a workweek), a number of requirements generally must be met. Among those requirements is that the employee is paid on a “salary basis,” and the salary must be at least a particular “floor.” Effective December 31, 2019, the “floor” in New York State, for employees subject to the “executive” and “administrative” exemptions from overtime, generally will rise as follows:
In New York City: $1,125 per week ($58,500 annually);
In Nassau, Suffolk, and Westchester Counties: $975 per week ($50,700 annually);
In the remainder of New York State: $885 per week ($46,020 annually).
Please recall that while New York State does not have a salary “floor” for employees subject to the “professional” exemption, there is a Federal threshold which, as of January 1, 2020, will be $684 per week ($35,568 annually).
New York Paid Family Leave:
Effective January 1, 2020, eligible employees may continue to take up to 10 weeks of paid leave; the maximum benefit amount will increase to 60% of an employee’s average weekly wage rate, up to a maximum of $840.70 per week.
That increase will result in a higher payroll deduction. (Recall that paid family leave is funded by employee contributions to a paid family leave rider that employers must have on their temporary disability insurance plans.) We recommend that you confirm with your temporary disability insurer and payroll provider that all is in order.
New York State and City Human Rights Laws:
What follows are brief reminders of select items referenced in our prior update, with respect to expanded obligations under these laws.
January 6, 2020: New York State employers generally no longer may request a job applicant’s prior compensation history. Please note that a similar law has been and remains in effect in New York City.
January 11, 2020: The New York City Human Rights Law will extend to protect freelancers and independent contractors so that they can file claims of discrimination, harassment, and retaliation with the New York City Commission of Human Rights.
January 13, 2020: The New York City Human Rights Law generally applies to employers with 4 or more employees. For purposes of counting, as of this date employers must count, among others, independent contractors and freelance workers if they were engaged at any time during the 12 months prior to the date of an alleged violation of the law.
February 8, 2020: The New York State Human Rights Law will apply to all New York State employers, regardless of size (even including those with just one employee).
May 10, 2020: Pre-employment drug testing for marijuana, as a condition of employment, generally will be banned in New York City.
If you have employees in New Jersey:
Minimum Wage and Overtime Update:
Minimum Wage: Effective January 1, 2020, the minimum wage in New Jersey generally will be:
Generally: $11.00 per hour; but
For employees of seasonal or small employers (i.e. employers with less than 6 employees): $10.30 per hour.
The current “Wage and Hour Abstract” poster, reflecting the above, is here: http://lwd.dol.state.nj.us/labor/lwdhome/content/employerpacketforms.html.
Exemptions from Overtime: In order for an employee to be exempt (i.e. not entitled) from premium overtime pay (i.e. time and one half the employee’s regular rate for hours worked over 40 in a workweek), a number of requirements generally must be met. Among those requirements is that the employee is paid on a salary basis, and the salary must be equal to or more than a particular “floor.” Effective January 1, 2020, the “floor” in New Jersey generally will rise in accordance with new Federal law, as follows:
For employees subject to the “administrative,” “executive,” and “professional” exemptions: $684 per week ($35,568 annually);
For employees subject to the highly compensated employee exemption, total annual compensation of $107,432.
New Jersey Family Leave Insurance:
As a reminder, beginning January 1, 2020, payroll deductions will increase for both New Jersey Family Leave and Temporary Disability Insurance benefits. We recommend that employers confirm with their applicable insurers and payroll providers that all is in order.
Prior Compensation History:
Effective January 1, 2020, New Jersey employers generally may not request a job applicant’s prior compensation history. Certain limited exceptions apply.
Yearly Reminders:
At this link http://lwd.dol.state.nj.us/labor/lwdhome/content/employerpacketforms.html you can find the “CEPA (Whistleblower)” notice. In addition to posting the notice as all New Jersey employers must, employers with 10 or more employees must distribute it to their employees annually. There is no particular requirement re: memorializing having done so, but we suggest that employers do so. The “Contact Information” section at the bottom of the notice must be completed.
Employers with 50 or more employees must, in addition to posting the “Gender Equity Notice” found at the same link and providing a copy at the time of hire, also must distribute the notice annually. The acknowledgment at the bottom must be signed, and the signed form must be returned to the employer within 30 days of an employee’s receipt of it.
NJ and NY Employment Law Updates
Over the past few months, NJ and NY have passed a slew of new and amended employment laws. What follows is an update regarding recent and upcoming changes as a result. The below are brief points providing the general thrust of the new developments – each of the laws has various provisions affecting applicability and enforcement. We of course are happy to assist with compliance with any of the below.
In New Jersey:
Salary history ban: Effective January 1, 2020, NJ employers generally no longer may request a job applicant’s prior compensation history.
Medical marijuana protection: NJ now generally prohibits an employer from taking any adverse employment action against an employee based solely on the employee’s status as a registered medical marijuana patient. The law does not prohibit drug testing, but does provide new required procedures that must be followed when an employee or applicant has tested positive for marijuana.
Minimum wage: As of July 1, 2019, the minimum wage for most NJ employers is $10.00 per hour. Beginning January 1, 2020 and each year through 2024, that rate will increase by $1.00 (for a final rate of $15.00). For small employers, generally meaning those with five or less employees, the minimum wage remains $8.85 per hour, and as of January 1, 2020 will increase to $10.30, with varied yearly increases afterward to bring the rate to $15.00 by 2026. The preceding may be affected by certain changes in the consumer price index in the meantime. Employers that believe they are “small” should be certain that they are properly counting employees, as the counting requirements are more complex than merely considering the number of employees at any given time.
Wage violations: NJ’s new Wage Theft Act is in effect now. Among other things, the act requires employers to distribute to current employees and new hires a notice concerning their rights under New Jersey’s wage and hour laws (although the NJDOL has not yet released the model notice); extends the statute of limitations for wage claims from two years to six years; permits treble damages as a remedy for wage violations, along with an award of the claimant’s costs and attorney fees; includes new anti-retaliation measures; provides for personal liability of certain officers and agents of the employer; and creates a third-degree crime criminalizing an employer’s “pattern of wage nonpayment.” In light of the harshness of the new law’s remedies, we strongly recommend that every NJ employer audit and confirm the legality of its wage and hour practices (including, among other things, regarding the minimum wage, premium overtime pay, and exemptions from overtime pay).
In New York:
Salary history ban: Effective January 1, 2020, NY State employers generally no longer may request a job applicant’s prior compensation history. Please note that a similar law has been and currently is in effect in NYC.
Employee appearance and grooming: Effective now, NY has amended the definition of “race” in its anti-discrimination law to include “traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” Protective hairstyles include, among others, “braids, locks, and twists.” As such, workplace grooming or appearance policies that ban, limit, or restrict natural hair or that disparately impact particular races or ethnicities now are unlawful. Also, effective October 8, 2019, employers may not discriminate against employees based on “any attire, clothing, or facial hair” reflecting a sincerely held religious practice.
Pay equity: Effective October 8, 2019, NY's pay equity law, which previously only concerned pay discrepancies with respect to gender, will extend to discrepancies with respect to any protected class of persons recognized under NY’s non-discrimination law (such as age, race, national origin, sexual orientation, and many others). The law requires equal pay among employees who perform “substantially similar” work, when the jobs being compared are “viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.” This is a lower standard for an employee claim than the previous “equal work” standard, and the law permits an employee to establish a violation even if his or her position is not identical to the comparator's position.
Anti-discrimination: NY has (yet again) overhauled its anti-discrimination law to include, among other things, the following:
Effective now, at the time of hire and at annual training, the employer must provide employees with a copy of the employer’s anti-sexual harassment policy as well as the information provided at the anti-harassment training. It is expected that NY will further clarify the latter requirement.
Effective October 11, 2019, protection under the law will extend to independent contractors and domestic workers; an employee claiming a hostile work environment will need to meet a far lower standard of proof than previously, and certain classic employer defenses will be weakened; non-disclosure provisions in settlements of discrimination claims will be prohibited, other than by employee choice; a complaining employee may be awarded punitive damages; and either the employer or employee may be awarded its attorney fees if it is the prevailing party in the dispute (although the standard for an employer to be awarded fees is much more difficult than for an employee).
Effective January 1, 2020, there will be a notice requirement with respect to employee disclosure rights.
Effective February 8, 2020, the anti-discrimination law applies to all NY employers (rather than those with four or more employees, as is the case now).
Effective August 12, 2020, the statute of limitations to make a claim under the law will be extended from one year to three years.
Lactation room accommodation: The following concerns employers in NYC with four or more employees only (although there are NYS and Federal requirements that apply more broadly), and is in effect now. The law requires an employer to provide an employee needing to express breast milk with a lactation room (other than a restroom) and a refrigerator suitable for breast milk storage. An employer also must maintain a written policy with respect to, among other things, the right to request a lactation room and the procedure for doing so. NYC provides model policies and a request form here: https://www1.nyc.gov/site/cchr/law/lactation.page.