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Governor Patterson Signs Several New Pieces of Legislation Affecting New York Employers

September 9, 2010

By Subhash Viswanathan

The end of August was a busy time for Governor Paterson who acted on 90 pieces of pending legislation. Several of those laws will have an impact on employers across the State. Below is a brief summary of the new laws.

Domestic Workers Bill of Rights

By signing the “Domestic Workers Bill of Rights” Governor Paterson made New York the first state to have such a law. When he signed the legislation, Governor Paterson remarked that: “Today we correct an historic injustice by granting those who care for the elderly, raise our children and clean our homes the same essential rights to which all workers should be entitled.” The law, which takes effect November 29, 2010, defines a protected domestic worker as a “person employed in a home or residence for the purpose of caring for a child, serving as a companion for a sick, convalescing or elderly person, housekeeping, or for any other domestic service purpose.” Excluded from the definition are persons who: work on a casual basis; provide companionship services and are employed by someone other than the family or household for which the services are provided; and relatives by blood, marriage or adoption of the employer or of the person for whom the worker is providing services under a program funded by a federal, state or local government. Among other things, the law provides the following protections and benefits for covered domestic workers:

1)  the right to overtime pay at time and a half after 40 hours of work in a week, or 44 hours for workers who reside in the employer’s home;

2)  one day of rest every seven days, or overtime pay if it is waived;

3)  three paid days of rest annually after one year of work;

4)  the removal of the domestic workers exemption from the Human Rights Law, and the creation of a special cause of action for domestic workers who suffer sexual or racial harassment; and

5)  the extension of statutory disability benefits to domestic workers, to the same degree as other workers.
 

Bereavement And Funeral Leave For Same-Sex Partners

Another bill signed by the Governor requires that employers who provide leave for the death of an employee's spouse or the child, parent or other relative of the spouse, must provide the same leave to an employee for the death of the employee's same-sex committed partner or the child, parent or other relative of the same-sex committed partner. The law, which is effective October 29, 2010, defines same-sex committed partners as “those who are financially and emotionally interdependent in a manner commonly presumed of spouses.”

Construction Industry Fair Play Act

Finally, in an effort to respond to the issue of employee misclassification in the construction industry, Governor Paterson signed the Construction Industry Fair Play Act, which takes effect on October 29, 2010. The Act creates a presumption that any person performing services for a construction contractor is an employee, not an independent contractor. The presumption can only be rebutted if the person satisfies the requirements to be classified as a separate business entity, as defined by the Act, or the person meets the following criteria which establish independent contractor status:

1)  the individual is free from control and direction in performing the job, both under his or her contract and in fact;

2)  the service must be performed outside the usual course of business for which the service is performed; and

3)  the individual is customarily engaged in an independently established trade, occupation, profession, or business that is similar to the service at issue.

In addition, and for the first time in New York State history, the Act imposes monetary and criminal penalties on construction industry employers that willfully misclassify employees.

Governor Paterson did veto several piece of legislation that would have affected employers across the state, including one which would have mandated that employers excuse the absence/lateness of an employee if such absence/lateness was due to the fact that the employee was responding to an emergency as either a volunteer ambulance worker or volunteer firefighter.

There are several pieces of employment-related legislation the Governor has not yet acted on. We will follow and report on those if and when the Governor signs them.
 

Class Action Discrimination Claims - Some Recent Costly Experiences For Private And Public Sector Employers

September 9, 2010

By Robert A. LaBerge

Several news stories over the past few weeks illustrate the potential expense and embarrassment public and private sector employers can experience from a class action employment discrimination lawsuit.  In the private sector, class action discrimination claims have been pursued with increased frequency over the past five years. These lawsuits have proven to be costly for both large and smaller employers. For example, the Rochester Democrat and Chronicle reported on August 10, 2009, that Elmer W. Davis Company, a commercial roofing contractor in Upstate New York, entered into a consent decree under which it agreed to pay $1,000,000 to resolve a class action race discrimination lawsuit brought by the Equal Employment Opportunity Commission. Msnbc.msn.com reports that the million dollar payout was the largest EEOC settlement ever in the Rochester area.

Elmer W. Davis Company’s settlement can now be added to a long list of multi-million dollar class action settlements. Large class action settlements have affected many national employers in virtually every type of business, including Coca-Cola ($192 million), Texaco ($176 million), State Farm Insurance ($156 million), Home Depot ($104 million), Federal Express ($55 million), Abercrombie & Fitch ($50 million), and Wal-Mart ($17.5 million). Many of these settlements have received considerable publicity and, as is the case with the Elmer W. Davis Company’s settlement, required these companies to implement training, monitoring, and other remedial programs in addition to making large settlement payments to the plaintiff class and its counsel.
 

These potential class action problems are not limited to private sector employers. Forbes.com recently reported that the federal government is defending itself from a class action discrimination claim brought by representatives of applicants for temporary census taker jobs. The plaintiff group, which potentially consists of up to 100,000 minority applicants, alleges that the U.S. Census Bureau discriminated by rejecting applicants with criminal records. The complaint was filed in the Southern District of New York in March 2010 and challenges, among other things, the U.S. Census Bureau’s alleged practice of rejecting applicants with arrest records, even when those arrests did not result in convictions. The complaint was recently amended and now also relies upon a letter that the EEOC’s former Acting Chair Stuart Ishimaru apparently sent to the Census Bureau in July 2009 after his agency received inquiries from many applicants who claimed to have been disqualified because of their prior arrest records. The complaint states that Mr. Ishimaru warned in his letter that the information the EEOC had gathered suggested that the “Census Bureau’s approach [was] overbroad and may run afoul” of Title VII.

The Daily Labor Report and Law 360° have also reported over the past few weeks on a number of other class action discrimination cases in which employers are facing multi-million dollar claims; these reports indicate that the employers have received mixed results in these cases. All of these cases highlight the need for employers of all sizes, in all industries, to take steps to address and to minimize potential class action discrimination problems. These steps can include implementing preventative and compliance measures, such as internal audit and review of hiring, promotional, and termination policies, and implementing procedures and safeguards for identifying and promptly responding to troubling claims involving pattern and practice discrimination allegations or multiple similarly situated employees.
 

Self-Insured Group Health Plans Must Arrange for Independent External Claims Review

September 7, 2010

Self-insured group health plans are not subject to the New York State Insurance Department's existing external appeals process for claims denied by insurers. However, a new interim enforcement rule issued by the Employee Benefits Security Administration requires that self-insured plans put external review procedures in place by the first day of the first plan year that begins on or after September 23, 2010 -- January 1st, for health plans with a calendar plan year. These rules (EBSA Technical Release 2010-1) require the group health plan to hire at least three independent review organizations (IROs) to make decisions with respect to the claims when an external appeal is requested.

The rules contain important requirements governing the selection of an IRO and the way the IRO functions. For example, an IRO cannot be hired or compensated based on the likelihood it will agree with the plan's prior decision. In addition, claims must be rotated among the IROs to ensure independence. The contracts with the IRO must contain specific terms detailing the IRO's responsibilities, such as timing and response criteria with respect to standard and expedited external appeals. In conducting the review, the IRO may not give any deference to the group health plan’s prior determination. The entire process, from the date or the request for external review to the final determination, must take no longer than 45 days. An expedited process must be available for decisions that: can seriously jeopardize the life or health of the claimant; would jeopardize the claimant's ability to regain maximum function; or relate to admission or emergency services and the claimant has not been discharged.

The group health plan has responsibilities, too. For example, the plan must quickly evaluate whether the claim is eligible for external review, and provide the documents and information that form the basis for the original denial.

Group health plans must quickly adopt procedures that are compliant with the EBSA Technical Release. IROs are already soliciting this business from self-funded group health plans. Remember, ERISA compels plan administrators to prudently select and monitor its service providers, including IROs. A group health plan sponsor should evaluate and document the qualifications of any IRO it considers hiring, and enter into fully compliant contracts, including business associate agreements, with such providers.
 

Can Employers Prohibit Employees From Expressing Their Religious Views in the Workplace?

September 1, 2010

By Subhash Viswanathan

An interesting case from the United States District Court for the Western District of Kentucky addresses a particularly difficult religious accommodation question: at what point can an employer prohibit an employee from expressing religious views in the workplace? According to the Court’s opinion, the case involved a nurse employed by the University of Louisville’s medical center. Based on her reading of portions of the Bible, the employee believed she had calculated the date for either the end of the world or the coming of the Antichrist, 12/21/2033. She also believed that she was compelled by her religion to share her views and her calculations with her co-workers. The co-workers complained to their manager that the employee would not stop talking to them about the subject, even when they asked her not to, and that she was scaring them. The manager had a conversation with the employee and told her to stop or face discipline. Although the employee was not disciplined, she submitted her resignation as a result of the conversation.

In granting the Hospital's motion for summary judgment, the Court first noted that the employee could not establish a prima facie case of failure to accommodate her religious beliefs because she had failed to show the employer took any adverse action against her. The Court went on, however, to conclude that even if the employee had been disciplined, she could not state a failure to accommodate claim, because the employer was not required to accommodate the employee’s religious beliefs under these circumstances. Although the case was brought under Kentucky state law, the Court relied on federal court precedent in Title VII cases to find that an employer does not have an obligation to accommodate an employee’s desire to impose her religious views on co-workers by harassing them. Were an employer required to provide such an accommodation, it would create an undue hardship because it necessarily infringes on the rights of co-workers.

This does not mean, of course, that an employer can prohibit all forms of religious expression in the workplace. But where the employee’s expression consists of attempting to proselytize co-workers who object to the conduct, and amounts to harassment, the employer can ask the employee to stop, and if she does not stop, impose discipline.
 

NY DOL Issues Revised WARN Regulations

August 25, 2010

By Colin M. Leonard

Earlier this year, we posted on the New York State Department of Labor’s new regulations governing New York’s WARN Act, the state statute that requires certain employers to provide 90 days notice to employees, their employees’ unions, if any, and to government agencies, before engaging in certain actions which result in losses of employment. In July, the New York DOL issued revised emergency regulations which replace and supersede the existing regulations. The revisions are not extensive. However, a few of the changes may be significant for New York employers contemplating some form of reduction in force or work hours.

First, the new regulations change the definition of the term “affected employee” by stating that it does not include an officer, director, or shareholder. The initial regulation only excluded business partners, and consultants and contract employees who have employment relationships with other employers or who are self-employed.
 

Only employers with 50 or more employees are covered by New York’s WARN Act. The revised regulations impact coverage determinations by defining the point in time for measuring the number of employees as the date the first notice would be required to be given under the Act.

The revised regulations also make some minor modifications to the required content of the notices which must be provided. More significantly, the revised regulations now apply the notice requirements to employer decisions rescinding a previously issued notice of plant closing, mass layoff, relocation or covered reduction in hours. In other words, when an employer has given notice required by the Act, but then determines that it will not need to engage in the action for which notice was provided, it must use the same notice process to inform affected employees, their unions and the government that it is rescinding its decision.

Finally, the regulations provide that when an employer relies on one of the statutory exceptions, (unforeseeable business circumstances, a natural disaster and the faltering company exception) as a justification for not providing the 90-day notice, it must provide documentation to support the exception.

The revised regulations are still lengthy and complex. Any New York employer contemplating any form of reduction in employment, including a reduction in hours should carefully consider whether the regulations apply and, if so, how it will satisfy the regulatory requirements.

 

New York State Department of Labor Adds Counsel Opinion Letters to Website

August 18, 2010

By Subhash Viswanathan

The New York State Department of Labor recently added to its website opinion letters written by its Counsel’s Office. The Counsel's Office provides legal advice and counsel to the Commissioner of Labor and to programs within the Department. The opinion letters are primarily responses to requests for advice submitted by employers. All the letters are text-searchable.  They cover three general topics: wage and hour law, public works projects and the State Worker Adjustment and Retraining Notification Act (“WARN”). The wage and hour law letters span a wide variety of topics from blood donation leave and accommodations for nursing mothers to employment classifications, independent contractor issues, meal and rest periods, overtime, and wage deductions under Labor Law Section 193. The public works projects letters deal with state requirements for payment of the prevailing wage (the local union wage) by private employers performing work on public works projects. Most of those letters address whether the prevailing wage law applies to particular types of work. There are only a few opinion letters related to WARN, which is not surprising because the statute and its implementing regulations are still relatively new. Interestingly, none of the letters made publicly available predate 2007, the first year of a newly elected Democratic administration.

OSHA Issues High Penalty Failure-To-Abate Citations

August 11, 2010

By Michael D. Billok

An employer that has entered into a settlement agreement with OSHA, or that has been found in violation of OSHA regulations or the general duty clause--either by order of an Administrative Law Judge or as a consequence of accepting a citation--should adhere to all provisions of any agreement, and abate all cited conditions. An OSHA Area Office may assess a failure to abate penalty of up to $7,000 per citation item per day for each day the condition is not abated. Normally, the maximum time period is 30 days, for a maximum penalty per citation item of $210,000, but that time period may be increased in exceptional circumstances.

Last week, OSHA issued citations of over $200,000 each to two New York businesses. The first, totaling $210,000, was issued to Broadway Corp., doing business as Broadway Concrete, for failing to abide by a settlement agreement entered into after first receiving a citation for lack of fall protection back in 2008. OSHA conducted a follow-on inspection in January of this year, and in the new citation alleges that Broadway Concrete performed work at eight sites in New York City without adequate fall protection, in violation of the settlement agreement. The second citation issued last week, totaling $247,000, was issued to U.F.S. Industries, doing business as Sally Sherman Foods, for failing to abate conditions previously cited--lack of fall protection, machine guarding, and inadequate lockout/tagout--following a prior inspection at its Mount Vernon facility.

New York Area Offices have recently issued several other high-penalty failure-to-abate citations, suggesting that this may signal a new direction in enforcement in Region 2 (which includes New York and New Jersey):
 

  • On July 20, OSHA issued citations totaling $112,000 in penalties to a Home Depot in West Nyack, chiefly for failure to abate items regarding potential employee exposure to methylene chloride.
  • On June 2, OSHA issued citations totaling $346,500 in penalties to CEC Elevator Cab Corp in the Bronx, chiefly for failure to abate items regarding various programs and training.
  • On April 28, OSHA issued citations totaling $107,000 to the Service Manufacturing Group in Buffalo, chiefly for failure to abate items regarding cranes, slings, fire extinguishers, and other issues, at its sheet metal fabrication plant.

Last, but certainly not least, last week OSHA issued the third largest citation in history, $16.6 million to several contractors and subcontractors for alleged violations associated with the February 7, 2010 explosion at the Kleen Energy power plant in Middletown, CT. (The two largest OSHA citations were issued to BP in association with a 2005 explosion at its Texas City refinery, and alleged failures to abate conditions following the expiration of a settlement agreement.) 

UPDATE:  SInce this post was first published on August 11, another New York Area Office just issued a six-figure failure-to-abate citation, this time a $114,750 citation to Pierce Industries, a Rochester machine shop, for failing to correct a variety of hazards following an initial citation issued in December 2009.

Court Upholds 55/25 Early Retirement Incentive: Appeal Filed

August 6, 2010

By Subhash Viswanathan

            On July 23, 2010, the Supreme Court of Albany County upheld the constitutionality of Chapter 45 of the Laws of 2010. Chapter 45, which was signed into law by Governor David Paterson on April 14, 2010, creates an early retirement incentive for employees in positions represented by collective bargaining units affiliated with the New York State United Teachers (“NYSUT”) who belong to either the New York State Employee Retirement System (“ERS”) or the New York State Teachers Retirement System (“TRS”), are at least 55 years of age, and have attained at least 25 years of creditable service (“55/25 Legislation”). The 55/25 Legislation allows eligible employees to retire without the reduction in retirement benefits that would normally apply to retirement system members who are on Tiers 2, 3, or 4, and who do not have 30 years of service. A more complete description of the 55/25 Legislation is set forth here.

            Two days after the 55/25 Legislation was signed into law, on April 16, 2010, the Empire State Supervisors and Administrators Association (“ESSAA”), a union that represents primarily administrators and supervisors in public school districts, and the Baldwin Supervisors Association (“BSA”), a local affiliate of the ESSAA, initiated a court proceeding challenging the 55/25 Legislation. Specifically, the ESSAA and BSA alleged that the 55/25 Legislation violated the First and Fourteenth Amendments of the United States Constitution, as well as Article 1, Section 11 of the New York State Constitution, by limiting eligibility only to individuals who are employed in positions represented by collective bargaining units affiliated with NYSUT. The ESSAA and BSA argued that the 55/25 Legislation violated their rights to equal protection and freedom of association.

           

        In the July 23, 2010 decision, the Court rejected the challenge to the 55/25 Legislation, finding that it was not irrational or illogical of the Legislature to limit eligibility only to employees in positions represented by bargaining units affiliated with NYSUT. The Court accepted the argument of the State and NYSUT that “early retirement incentives in the public school context can be particularly effective when targeted at teachers (i.e. individuals who provide direct classroom instruction) because a high-salaried teacher who accepts an early retirement incentive will often be replaced by a new, entry-level teacher at a lower salary” while in contrast “an outgoing administrator will typically be replaced by an individual closer in rank and, therefore, comparable in salary.” According to the Court, as NYSUT represents virtually all of the classroom teachers and teaching assistants employed in public schools across New York State, it was rational for the Legislature to limit eligibility to employees in bargaining units affiliated with NYSUT because “NYSUT affiliated locals are a reasonable proxy for teachers.”

            The Court recognized the fact that there are four public school districts in which NYSUT does not represent teachers and related teaching titles. If the plaintiffs in this case had been teachers at one or more of those public school districts who would have been eligible for the incentive but for their union affiliation, it is not clear whether the outcome would have been the same. It is possible that eligible employees in the same type of position supposedly targeted by the 55/25 Legislation (classroom teachers) who were excluded from the incentive simply because they were not in NYSUT bargaining units might have had an easier time establishing that the NYSUT-only restriction was not rational. In that context, the Court could not have focused solely on the teacher vs. administrator distinction, and the argument that “NYSUT affiliated locals are a reasonable proxy for teachers” would likely be much less persuasive. However, because the plaintiffs in this case were unions that represented primarily administrators and supervisors, the Court did not reach the issue of whether it was rational to exclude the few eligible teachers who are not part of NYSUT bargaining units.

 

            Within several days of the Court’s decision upholding the 55/25 Legislation, the ESSAA and BSA filed a Notice of Appeal. Accordingly, the fate of the 55/25 Legislation has not yet been conclusively determined. TRS recently released a statement that it will continue to implement Chapter 45 as written, but that “the payment of the unreduced retirement benefit to eligible members who retired pursuant to Chapter 45 will be subject to the final outcome of any appellate process.”

 

If the appellate court ultimately finds Chapter 45 to be unconstitutional, it is possible that individuals who have retired under its provisions may have their pensions reduced to reflect the penalty for retiring prior to attaining 30 years of service. However, it is also possible that the appellate court could eliminate the NYSUT-only restriction on eligibility, which would cure the unconstitutionality of the 55/25 Legislation while at the same time not causing a reduction in the pensions of individuals who retired in reliance upon the 55/25 Legislation.

United States Department of Labor to Revise Regulations on Reporting of Costs Related to Union Organizing Campaigns

August 2, 2010

By Colin M. Leonard

As part of its Spring 2010 regulatory agenda, the U.S. Department of Labor (“USDOL”) has indicated it plans to revise its longstanding interpretation of federal law on the reporting and disclosure requirements for employers in connection with a union’s organizing campaign. Such reporting is required under the Labor-Management Reporting and Disclosure Act (“LMRDA”), which contains various financial disclosure requirements for employers, unions and others. Among other things, the LMRDA requires employers to file annual reports with the federal government to disclose agreements made with third parties (and any associated payments), where a purpose of the agreement is to persuade employees with respect to their right to unionize. A willful failure to submit a required report or material false statements made on the report are crimes.

However, the LMRDA does not require reporting to the federal government where the services rendered relate to the “giving or agreeing to give advice” to an employer. Since at least 1962, the long-standing interpretation of the “advice exception” excludes from reporting various persuader activities performed by third party consultants, including the preparation of documents and materials to be used by the employer during the organizing campaign. As long as the third party consultant does not meet directly with employees in connection with persuader activities, agreements relating to these types of services need not be reported. The Office of Labor-Management Standards, which enforces the LMRDA, states that the advice exception has been “broadly interpreted to exclude from reporting any agreement under which a consultant engages in activities on behalf of the employer to persuade employees concerning their bargaining rights but has no direct contact with employees, even where the consultant is orchestrating a campaign to defeat a union organizing effort.” (Emphasis added). In fact, Judge (now Justice) Ruth Bader Ginsburg upheld this interpretation of the “advice exception” when the United Auto Workers sought to challenge the agency’s position in the late 1980s. U.A.W. v. Dole, 869 F.2d 616 (D.C. Cir. 1989).
 

The Obama administration now seeks to narrow the scope of the “advice exception” to require greater reporting and disclosure of an employer’s use of consultants in connection with union organizing efforts. Given the dramatic decline in union membership (now just 7.2% of private sector workers), unions are exploring every avenue to stem the losses. And the Obama administration apparently believes that changing the USDOL's long-standing interpretation of the “advice exception” may help unions reverse that trend by requiring employers to disclose the dollars spent in opposing a union organizing effort.

Because the process of notice and comment rule-making is currently ongoing, with initial promulgation of the draft regulation slated for November 2010, it is not clear exactly what form the revised regulation will take. Many believe that the administration will attempt to revive some version of the regulation that was promulgated in the last days of the Clinton administration and quickly rescinded by the Bush administration. Were the proposed Clinton administration regulation adopted, all services related to the preparation of materials would be reportable, if a purpose of the materials was to persuade employees – even if the consultant never engaged in persuader activities directly with employees.
 

Preventive Care Coverage Requirements Under Health Reform

July 29, 2010

One consequence of losing grandfathered plan status in an employment-based group health plan is the requirement that specified preventive services must be covered on a "first dollar" basis. This means that the specified preventive care services may not be subject to a deductible, co-payment, or other cost-sharing requirement. The agencies jointly responsible for enforcing the Patient Protection and Affordable Care Act ("Affordable Care Act") -- the Internal Revenue Service, the U.S. Department of Labor Employee Benefit Security Administration, and the Department of Health and Human Services -- jointly published interim final regulations ("Regulations") relating to the coverage of preventive care services on July 19, 2010. The Regulations apply to new plans and to non-grandfathered group health plans for plan years beginning on or after September 23, 2010 (January 1, 2011, for calendar year plans).  Key aspects of the Regulations are explained below.

Preventive Care Services

The Affordable Care Act requires that group health plans and health insurance issuers provide first dollar coverage for:

  • Evidence-based items or services that are highly rated by the U.S. Preventive Services Task Force. The regulations list those recommended items and services as of July 14, 2010. The list details 44 items, including such services as screenings for diabetes, blood pressure, cervical, colorectal and breast cancer, certain sexually transmitted diseases, and many services related to pregnancy and childbirth.
  • Immunizations recommended for routine use in children, adolescents and adults by the Centers for Disease Control and prevention, which the regulations define to include such routine childhood vaccines as Measles, Mumps, Rubella, Hepatitis A and B, Tetanus, Diphtheria, Pertussis, and Inactivated Poliovirus, as well as adult immunization for HPV, Meningococcal, Influenza and Zoster, among others.
  • Evidence-informed preventive care and screenings for women, infants, children and adolescents that are contained in guidelines supported by the Health Resources and Services Administration.

A complete list of required preventive services and items required under the Regulations is available at http://www.HealthCare.gov/center/regulations/prevention.html. If additional preventive care services and items are added to the list, the Affordable Care Act requires that there be a minimum interval of one year between the date the recommendations are issued and the plan year in which first dollar coverage must be provided. If a preventive service or item is dropped from the list, the plan may drop the coverage, or impose cost-sharing, with 60 days advance notice to the enrollee.

A group health plan or issuer may provide additional preventive care services beyond those contained in the current requirements, with or without cost-sharing, in its discretion.

If the preventive care recommendation or guideline does not specify how, or how often, the service or item is to be delivered, the Regulations permit the health plan or issuer to use reasonable medical management techniques to determine coverage limitations, such as the frequency, method, treatment, or setting in which the recommended preventive service will be available without cost-sharing.

When Preventive Care is Provided with Other Services

The Regulations recognize that many preventive care services are rendered in connection with other services in an office visit, and contain guidance regarding how the "first-dollar" rule applies in those circumstances. The standard rule is, if the preventive service is billed separately, cost-sharing may be imposed with respect to the office visit. In cases where the preventive service is not billed separately (or, in capitation or similar payment situations, there is no separate tracking of the individual encounter data), the following rules apply:

  • If the primary purpose for the office visit is the preventive service, no cost-sharing may be imposed for the office visit; and
  • If the primary purpose of the visit is not the preventive service, the health plan may impose the applicable cost-sharing requirements to the office visit.

In-Network vs. Out-of-Network Preventive Services

The Regulations specify that a health plan that differentiates between services provided by in-network providers and those available from out-of-network providers is not required to provide coverage for recommended preventive services and items delivered by an out-of-network provider. If such services are delivered by an out-of-network provider, they may be subject to the cost-sharing requirements of the health plan.

The Economic Impact of First Dollar Preventive Services

One of the key considerations employers face regarding whether to maintain grandfather status in a health plan is the cost effect of first-dollar preventive services (see the June, 2010, BS&K Employee Benefit Information Memorandum to determine what plan changes affect grandfather status). The federal Office of Management and Budget has determined that these regulations are economically significant because they are likely to have an annual effect on the economy of $100 million in any one year. For non-grandfathered group health plans, because preventive care expenses that were previously paid out-of-pocket will be covered by group health plans and issuers, the demand for these services will likely increase, and the cost of these services will likely result in higher premiums. Your insurer, insurance broker, or health plan actuary may be able to estimate the actual cost to any particular group health plan.
 

Break Time For Nursing Mothers Under the FLSA - Balancing Obligations Under New York Law With New Federal Requirements

July 23, 2010

By John M. Bagyi

Yesterday, the US Department of Labor issued a fact sheet  that provides general information on the break time requirement for nursing mothers, part of the Patient Protection and Affordable Care Act which took effect March 23, 2010. While these amendments to the Fair Labor Standards Act (FLSA) represent a significant change for employers in many states, since 2007, New York employers have been required to provide reasonable unpaid break time, or permit employees to use paid break time or meal time, to express breast milk. See our earlier posts on New York's requirement.

Thus, for New York employers, the most important observation contained in the US DOL's fact sheet is that the FLSA requirement of break time for nursing mothers to express breast milk does not preempt State laws that provide greater protections to employees. New York's protection of nursing mothers provides employees with a number of protections that exceed those provided under the new federal law. For example, New York law protects expression of breast milk up to three years following the birth of the child (federal law is limited to one year) and applies to all employers (federal law does not apply to employers with fewer than 50 employees).

Given that New York's protection of nursing mothers provides greater protection than the recent FLSA amendments, employers complying with existing New York law will be in compliance with the new federal law as well.

 

No COBRA Subsidy in Unemployment Benefits Extension

July 22, 2010

The emergency jobless benefits bill that cleared Congress today does not revive the COBRA subsidy for involuntary terminations. The subsidy expired with respect to terminations after May 31st.
 

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