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Welcome

The materials and information have been prepared for informational purposes only. This is not legal advice, nor intended to create or constitute a lawyer-client relationship. Before acting on the basis of any information or material, readers who have specific questions or problems should consult their lawyer.

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616.831.1704

[email protected]

Mary V. Bauman

ACA Update

News Flash: The ACA hasn’t gone away

Yes, the individual mandate penalty is going away after the end of this year

However, the employer pay or play mandate is still in effect for large employers

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Last year the IRS began issuing proposed pay or play penalty assessments (also known as “ESRP,” employer shared responsibility payments) with respect to calendar year 2015 2015 was the first year that the pay or play was in

effect

The IRS compared an employer’s filed 1094-C and 1095-Cs with the information from the exchanges as to which individuals were enrolled and received a premium tax credit

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To date, Miller Johnson has represented over 30 employers in responding to these alleged assessments

Nearly $50 million has been at issue

Our clients have been able to successfully defend these assessments

The IRS plans to begin issuing assessments this fall with respect to calendar year 2016

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Another misunderstanding:Congress has not repealed the ACA prohibition on

pre-existing condition exclusions or limitations under employer group health plans

Employers continue to be prohibited in imposing pre-existing exclusions or limitations under their group health plans

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The big unanswered question is what changes to the ACA can we expect going forward?

Several bills are pending in Congress. Whether the bills will pass, particularly in an election year, is uncertain.

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The changes can be grouped into the following general areas: Repeal employer pay or play penalty for 2015

through 2018

Further delay Cadillac tax from 2022 to 2023

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Changes to preserve HSA eligibility:Allow HDHP to cover first $250 single/$500 family

of specified services such as telemedicine expenses before deductible is satisfied

Permit employees to receive certain items and services through onsite or retail clinics before reaching HDHP deductible

Employees would be eligible for an HSA even if the employee’s spouse was enrolled in a general purpose medical FSA as long as the FSA did not reimburse any of the employee’s expenses

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Any bronze or catastrophic plan purchased on the exchange would be considered a qualified HDHP for HSA eligibility purposes

All employees enrolled in Medicare Part A only (and not Part B or D or a Medicare Advantage Plan) would still be HSA eligible

The employee could receive certain qualified concierge services before reaching the HDHP deductible and still be HSA eligible

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Changes to increase HSA contributions Increase HSA annual contributions limits to align

with the HDHP maximum out-of-pocket limits ($6,750 single / $13,500 family for 2019)

Allow both spouses to make age 55 catch-up contributions to the same HSA

Restore FSA / HRA transfers to an HSA

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Changes to expand tax-free distributions from an HSADrugs could be reimbursed even if not prescribed

by a physician (also would apply to medical FSAs)

Expenses incurred up to 60 days before HDHP / HSA established

Gym memberships and exercise classes (also would apply to medical FSAs and potentially, employer group health plans)

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269.226.2979

[email protected]

John F. Koryto

Legal Trends Impacting The Workplace

Immigration Policies And Procedures Affecting Employers

NLRB Developments


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Congressional gridlock at federal level There have been no major changes in employment

law through legislation at the federal level

State law makers pushing aheadMany important employment law changes have

come at the state or municipal level

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Medicinally available:Michigan and 30 more States and the District of

Colombia have either approved or enacted legislation

legalizing marijuana for medicinal purposes

Recreationally available:Alaska, California, Colorado, Maine, Massachusetts,

Oregon, Nevada, Vermont, Washington

What does it all mean?While it is still illegal under federal law, Michigan and

other state laws will create issues in the workplace

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Michigan and other states are expanding paid sick leave benefits Michigan Earned Sick Time: Accrual of 1 hour for every

30 hours worked

Nevada: Protected time off for domestic violence (while not sick leave per se, a growing number of states are granting leave for this reason)

New York: Expanded paid sick leave law to cover situations where an employee or family member is a victim of a family or sexual offense, or stalking

Other: California, Maryland, New Jersey, Oregon, Rhode Island, and Washington expanded paid leave policies

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Several states and cities have passed laws forbidding questions about salary history in interviews to push for pay equity among men, women, and minoritiesCurrently enacted or approved: Connecticut,

California, Delaware, Massachusetts, Oregon, New York City, Philadelphia, Puerto Rico, and San Francisco

Pending Legislation: Idaho, Maryland, New York, Rhode Island, Texas, and Virginia

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Workplace sexual harassment has taken center stage With the prominence of the #MeToo movement, there has

been a renewed focus on sexual harassment in the workplace and a push by many state legislatures to address the problem with new laws

Prevention policies and training Required written anti-harassment policy – California, Maine,

Massachusetts, New York, Rhode Island, and Vermont. Some states also require a certain amount of training hours for certain groups of employees (e.g., supervisors)

Mandatory training - passed in California, Connecticut, New York and Maine. With bills also introduced in Delaware, Pennsylvania, Rhode Island, and Virginia

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Predictive schedulingNew York City (No. 1395 & 1396), Oregon (SB 828),

& Emeryville, CA Resolution (No.17-013 & 17-160)

Social Media Policy - Vermont (HB 462) Prohibits employers from requiring or requesting

that employees or applicant disclose a social media account, access in employer’s presence, change account privacy settings, etc.

Immigration - California (AB 450) Unless otherwise required by federal law, employers

are prohibited from consenting to ICE access to worksite and records

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Employer sponsored immigration petitions facing extensive processing delays, record levels of request for additional evidence, and record levels of visa petition denials – Plan Ahead!

Department of Labor audits of employer immigration filings, and required record keeping are increasing – make sure records are in order!

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ICE enforcement activity and I-9 audits dramatically increased – conduct self-audits and fix problems now!

Social Security mismatch letters to again be issued Spring 2019 – new enforcement proposal threatens employers with increased fines!

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Many pro-immigration groups and growing numbers of U.S. employers, have complained an “invisible wall" has been built to effectively reduce immigration to the U.S., this barrier is blocking many highly skilled employer sponsored immigrants

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The bricks in this “invisible wall” include:New no deference rule, meaning no deference is

afforded to previous approved petition for employment based immigration benefits

Restrictive interpretation of who qualifies as a “specialized knowledge” worker

Returning workers counted toward the annual H-2B visa program quota

Canceling new regulations to update/expand investor and entrepreneur visa requirements

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Proposed rulemaking for joint employer test Possess and exercise substantial, direct and

immediate control over the essential terms and conditions of employment

In a manner that is not limited and routine

Looking for public comment on Purple Communications –employee use of employer email

Already announced a much more employer-friendly standard for handbook policies

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The Board overruled Lutheran Heritage

“Mere maintenance” of neutral employment policies, work rules, and handbook provisions will no longer turn on a single inquiry

Instead, the Board will take into account two things:1. The nature and extent of the potential impact on

NLRA rights

2. The employer’s “legitimate justifications” associated with the rule

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In June, the Board’s GC issued a Memo offering guidance on handbook rules

Analyzes common rules and categorizes as: lawful, unlawful, and requiring individual scrutiny

Among the lawful rules: Civility rules

No photography or recording rules

Insubordination rules

Confidentiality rules

Disloyalty rules

Disruptive behavior rules

Rules against misrepresentation

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269.226.2957

[email protected]

Sarah K. Willey

Marijuana – Holy Smokes

Criminal History

Michigan Minimum Wage And Paid Sick Leave

Sexual Orientation And Gender Identity

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1930s

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Nov. 22, 2010 cover of TIMECover Credit: Photographs by Jeff Redel


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MMMA permits the possession, cultivation, manufacture and use of marijuana (and paraphernalia) to treat or alleviate a registered patient’s debilitating medical condition or symptoms The MMMA does not: Regulate private employment Protect Michigan employees from disciplinary action

for otherwise lawful use of medical marijuanaCreate any obligation by employers to accommodate

medical marijuana

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Marijuana use, possession and sale still illegal under federal law

To date, the USDOJ has not prosecuted for legitimate medical marijuana use

Attorney General Jeff Sessions is not a marijuana fan: “Slightly less awful than heroin”

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On November 6, Michigan voters will have the opportunity to legalize recreational marijuana Specifically, the possession, use, and cultivation of

marijuana by people who are at least 21 years old

Buy 2.5 / Keep 10 / Cultivate 12

If approved, Michigan would be the ninth state to legalize marijuana (AK, CA, CO, ME, MA, NV, OR and WA)

Highly likely to pass

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What this does NOT mean for Michigan employers The proposal does not require an employer to

permit employees to possess or use marijuana in the workplace

The proposal does not prohibit an employer from disciplining an employee for violating a workplace drug policy or for showing up for work with marijuana in his or her system

Whole point is to regulate like alcohol

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One huge difference Employers can test for impairment with alcohol

One huge problemMarijuana stays in the system for a looong time

Urine tests can detect THC for up to 13 days

Hair tests can detect more than 30 days after use

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What this DOES mean for Michigan employers More employees will have marijuana in their system

while at work

More employees will talk about using marijuana

Reasonable suspicion of marijuana in the system vs. reasonable suspicion of impairment

Positive test results will increase

CO: 20% / WA: 23% / NV: 43%

Employers will have difficulty enforcing their policies without casting a wide net

Safety v. staffing

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We have talked in years past about whether employers must consider applicants with a criminal background

Now many employers are considering the flip side: we’d like to hire applicants with criminal backgrounds—what are the risks?

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Negligent hiring / retentionA common law claim that you, the employer,

breached a duty you owed to keep an employee or third party safe (or safeguard their property)

A recognized cause of action in Michigan

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Negligent hiring / retention1. The employer knew or should have known that

the employee had committed similar acts before (on or off the job)

2. The employer had reason to believe that the employee had the propensity to commit the same or a similar act again

Bottom Line: The harm must be foreseeable

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Negligent hiring / retention The connection must be a close one

Brown v Brown

Foreman raped a security guard

No prior criminal record / No history of violent behavior

But: repeated crude, sexually explicit comments to the security guard, which she reported

Michigan Court of Appeals: employer is liable

Michigan Supreme Court: employer is not liable—no knowledge of employee’s propensity to rape

Very tough burden for plaintiffs

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Certificate of employability Issued to prisoners upon release if they: Successfully complete a career and technical education

course Had no major misconducts in the 2 years prior to release Had no more than 3 minor misconducts in the same

period Achieved a sufficient score on a job skills assessment

test

Proof that the employer met its duty of care Full defense against negligence claimObviously additional considerations . . .

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The One Fair Wage proposal

Minimum wage hike $10 – 1/1/19

$10.65 – 1/1/20

$11.25 – 1/1/21

$12 – 1/2/2022

2023 – adjusted annual basis on consumer price index

Notable provision: eliminated tipped workers minimum wage

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Earned Sick Time proposal Effective January 1, 2019

Can satisfy requirements with existing PTO, vacation, sick time policies

Accrual of 1 hour for every 30 hours worked

Must be available for use immediately after accrual

Can be used in the smallest increment that the payroll system uses to count time (likely .25/hr)

Mandatory carryover from one year to the next

Allowed maximum usage of 40 hours per year

No obligation to pay upon termination of employment

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The Republican-led Senate and House passed the proposals into law in a move described by critics as an “attack on democracy”

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If passed as a ballot initiative, changes require ¾ majority in House and Senate

If passed by legislature, simple majority required for amendments

Republicans are not giving away details, but one thing seems certain….

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Senate Majority Leader Arlan Meekhof “We’ll consider different options and a

whole suite of things we think are more friendly to Michigan, to make sure that workers are indeed cared for, and that still provide for economic development moving forward.”

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According to a 2016 survey by Greenberg Quinlan Rosner Research, 35 percent of likely voters in the United States “personally know or work with someone who is transgender.”

That's more than double the 17 percent who answered yes when asked the same question in 2014

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35%

The written law has not changed….

But interpretation of the law has Federal courts

EEOC

Local ordinances

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Title VII protected characteristics – race, color, religion, sex and national origin

Michigan’s Elliott-Larsen Civil Rights Act protected characteristics – religion, race, color, national origin, age, sex, height, weight, familial status and marital status

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Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) U.S. Supreme Court upheld a violation of Title VII based on sex stereotyping – at the time a novel legal theory

Evaluators voting on her partnership eligibility described female employee Hopkins as “macho” and complained that she “overcompensated for being a woman” by not dressing / acting feminine enough

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Supreme Court found that discrimination based on failure to conform to gender stereotypes(non-conformance with gender social norms regarding behavior, dress or grooming) is discrimination “based on sex” prohibited by Title VII

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March 7, 2018– 6th Circuit reverses the dismissal of a gender identity discrimination lawsuit filed by the EEOC against a Michigan funeral home

Funeral home argued that it was protected by its religious beliefs and should be allowed to enforce its dress code

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Court – decision to fire employee because she intended to dress as a woman was sex-based discrimination and unlawful under Title VII

Both transgender and transiting status are protected by Title VII

Rejected funeral home’s religious exercise argument because they were based on “presumed biases” and were not supported by evidence. Cannot rely on customers’ presumed biases to establish a religious freedom.

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EEOC accepts gender identity and sexual orientation discrimination charges

EEOC has filed (and is looking for) lawsuits to sue private employers under Title VII for discrimination based on gender identity / sexual orientation

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Over 25 local municipalities have Local ordinances in Michigan prohibiting LGBT discrimination by private employers. Examples-- Ann Arbor Oshtemo

East Lansing Saugatuck

Lansing Douglas

Kalamazoo Wayland

Battle Creek Detroit

Adrian Mount Pleasant

Muskegon Albion

Portage E. Grand Rapids

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Michigan AG Bill Schuette: Michigan’s civil rights law does not protect gay and transgender people

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Schuette, Currently Attorney GeneralCandidate for Michigan gubernatorial race in

November

MDCR had voted to expand the Commission’s interpretation of Elliott-Larsen to include sexual orientation and gender identity

Republican leaders in House and Senate requested AG opinion

Schuette – law does not specifically mention sexual orientation or sexual identity

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