August 2014
Welcome to August! It’s still hot; employees may be a bit more relaxed as they embark on or return from vacations and your organization may be experiencing reduced volumes of business and/or work output. Hang in there; the cooler months are just around the corner!
HR Alerts
PCORI Fees due July 31
Under the Affordable Care Act, organizations with self-insured health plans are required to pay an annual fee for the Patient-Centered Outcomes Research Institute. The fee, which is based on the plan’s average number of insured lives, is due each year on July 31. If you have a self-insured health plan, make sure you have filled out IRS Form 720 and submitted it with your payment. Employers with fully funded health plans through an insurance company do not have to worry about submitting the PCORI fee in most cases.
PCORI Fee FAQs:
Q: What is the PCORI fee?
A: The PCORI fee is an annual fee paid by the issuers and sponsors of certain types of health plans. It is intended to help fund the Patient-Centered Outcomes Research Institute, which compiles and distributes findings of comparative clinical effectiveness. The fee was established as a part of the Affordable Care Act.
Q: What is a fully funded health plan?
A: With a fully funded health plan, employers pay a set premium amount to an insurance company. The insurance company is then responsible for paying health care claim costs as outlined in the plan. Therefore, the employer does not directly pay claims and assumes no risk, as the risk of excessive claims is assumed by the insurance carrier. This is the most common form of employer-based health plans.
Q: What is a self-insured health plan?
A: With a self-insured plan, instead of using an insurance company to provide health care coverage, the employer directly pays the health care claims of employees. Typically, the employer will have a pool of money set aside to handle the variability in claims from month to month. In this model, the employer may save money that would have been the insurance company’s profit, but the employer is also assuming much greater risk of having to pay multiple large claims. This plan is typically only chosen by larger employers.
Q: Why do employers with fully funded plans not need to pay the PCORI fee for their health plan?
A: For fully funded health plans, the PCORI fees are paid by the health insurance company. Employers are not responsible for paying the fee or for filing the accompanying tax form.
Q: We offer health insurance to our employees through an insurance company, do we need to worry about any PCORI fees?
A: For employers who purchase group health plans through insurance companies (fully funded plans), the PCORI fee for the health insurance plan will be paid by the insurance carrier. For the most part, employers with fully funded health plans will not be responsible for any PCORI fees. In some limited instances, employers who, in addition to a group health plan, offer FSAs or HRAs that do not meet certain requirements will be responsible for the FSA or HRA PCORI fee and accompanying tax form as the plan sponsor. We recommend consulting your benefits provider or a tax professional if you are unsure of your responsibilities with these types of accounts.
Q: We do not offer health insurance to our employees, do we need to pay a PCORI fee?
A: Employers who do not offer health plans will not be responsible for health plan PCORI fees.
An Eye for an Eye: Workplace Retaliation
When asked which type of Equal Employment Opportunity Commission (EEOC) complaint is the most common, many assume that disgruntled employees file race, gender or disability EEOC charges with the most frequency. However, the most common EEOC charged filed in the last few years has been the charge of retaliation. Charges for allegations of workplace retaliation comprised 41.1% of all EEOC claims in the 2013 fiscal year. Race has been a close second in the past few years, coming in at 35.3% of all EEOC claims in the 2013 fiscal year.
So what is workplace retaliation? According to the EEOC, retaliation occurs when an employer takes an adverse action (such as demotion, termination or disciplinary action) against an employee because he or she engaged in a protected activity. Some protected activities include filing a workers’ compensation claim, reporting illegal behavior to the government or filing an EEOC discrimination charge. Simply put, anytime an organization terminates, demotes, harasses or otherwise retaliates against an individual for filing a charge with a regulatory agency, participating in an internal or external investigation into the charge, or otherwise opposing discrimination in the workplace, the employer may have violated the EEOC guidelines . The reason this claim is so common is that it is often added to other EEOC charges of all types, such as race, religion, national origin, etc. Therefore, when an employee goes to the EEOC to file a charge, they often include retaliation as part of the discrimination claim.
So, how is an employer to protect itself from claims of retaliation?
The first step is to minimize the organization’s risk of EEOC claims in general. It is critically important to treat employees consistently and in accordance with company policy with all aspects of employment, including hiring, pay, benefits, promotion, demotion, disciplinary action, termination, etc. It is also imperative for the management team to establish a working environment that does not condone harassment or bullying, especially based on the victim’s protected class status. Developing and communicating anti-harassment and anti-bullying policies alone is simply not sufficient for an employer to mitigate its risk in this regard. It takes complete support and behavior modeling from the senior management team in order to establish a workplace free from discrimination, harassment and bullying.
The second step is to adequately investigate all claims and allegations of discrimination, harassment and bullying, as well as to ensure that no employee within the organization retaliates against the claimant or others who participate in the investigation. The law protects against retaliation even when such retaliation is inadvertent or unintended in nature. Therefore, it is imperative that employees and managers keep the idea of retaliation at the forefront of their thoughts when working through internal investigations. The company’s anti-discrimination, anti-harassment and anti-bullying policies should all contain a provision prohibiting retaliation against complainants or those who participate in the investigation. Additionally, once a complaint is made, the allegation should be kept confidential to the extent practical so that less people within the organization have to opportunity to retaliate against the claimant.
Often when a discrimination, harassment or bullying complaint is filed against a manager, it takes a substantial amount of restraint from the manager to avoid retaliating against the employee. Therefore, it is suggested to remind the accused employee of the company’s very strict anti-retaliation policies when informing the accused of the complaint. Additionally, once a complaint has been made, it is often helpful to physically separate the complainant from the accused, generally by moving the accused employee to another shift, role, location, etc. at least for a temporary period while the investigation is underway to reduce the company’s exposure to a retaliation complaint and to diminish or cease any continuing harm.
Another item to consider is how the timing of certain employment decisions may look to an outside third party. For example, terminating an employee directly after learning that the employee has filed an EEOC claim certainly may look retaliatory at face value. It is important to consider how the timing of an adverse employment action may appear to a reasonable outsider who knows nothing about your organization. If you are able, it is best to allow an adequate amount of time to pass following the filing of a complaint before taking an adverse employment action against the complainant. However, doing so is not always possible, especially if the complaining employee’s workplace performance or misconduct is negatively affecting the business. Therefore, if the organization must take an adverse employment action against an employee who has recently filed an internal complaint or external charge, it is critically important that the management team collects adequate documentation in order to support the decision and consults with an HR Professional or labor law attorney regarding the situation.
It can be human nature to want to retaliate against employees who have made hurtful allegations against the organization or a member of the senior management team. As Mahatma Gandhi profoundly stated, “an eye for an eye will make the whole world blind.” It is imperative to remember that it violates federal law to retaliate in many complaint situations. Additionally, retaliation does not favorably enhance the organization’s reputation in the community. Through proper policy development, training and senior management behavior modeling, your organization can greatly reduce its exposure to an EEOC charge, including claims of retaliation.
Question & Answer
Question: If an employee is on short term disability and the position that the employee held is either outsourced or no longer a position with the organization, would that be cause to layoff the employee during the disability leave?
Answer: According to federal law, employees out on medical leave generally do not enjoy any additional job protection than do current employees. Therefore, if an employee is out on temporary disability or workers’ compensation leave, and during that time her entire department is laid off due to an organizational structure change, the employee out on leave may be subject to the layoff as well.
The main area of exposure for employers is when the employee out on leave is the only (or one of the only) employees subject to the layoff. It is generally illegal to terminate an employee due to a disability or medical condition. It is often difficult for the employer to demonstrate that the medical leave had no bearing on the termination decision. So there are a few important items to consider prior to terminating an employee who is out on leave:
Was the decision in any way motivated by the employee’s medical condition, disability, workers’ compensation claim or leave of absence?
Would the employee have been terminated regardless of whether she took medical leave due to external forces (outsourcing, business downturn, restructuring, etc.)?
Is the employer able to substantiate such external forces to a reasonable third party if ever challenged on the layoff decision?
Was the employee terminated at the same time as other employees, or at the time when the organization made the change? (It may look discriminatory if the employee is terminated just before returning to work, so the termination should be communicated to the employee on leave when the decision is made.)
Because laying off an employee who is on medical leave is a high-exposure termination, it is important to consult with your HR Professional or legal counsel prior to doing so.
Multi-Generations in the Workplace: Making Differences a Workplace Asset
For the first time in recorded history, the workplace encompasses four distinctive generations. The Traditionalists, sometimes referred to as War Babies, Baby Boomers, Generation X and Generation Y (also known as the Millennial Generation). Each generation was raised under drastically different economic and political climates. Their attitudes toward their careers, interacting with colleagues and balancing their professional and personal lives reflect the unique attributes that each generation brings to the workplace. The generations are defined as:
Traditionalists- born before 1945.
Baby Boomers, categorized by the surge of babies born post-World War II between the years of 1946 and 1964
Generation X born between 1965 and 1980
Generation Y (Millenials) born in 1980 and later are technically adept, highly sophisticated Traditionalists, (or War Babies), as they live up to their name, are notorious for their loyalty and dedication to their employers. Many entered into the workplace and committed to a career path with one organization to whom they loyally committed. This generation entered the workforce well before technological advances became a prominent aspect of business. Therefore, most Traditionalists did not begin using computer equipment in their daily responsibilities until mid-career or later. Traditionalists embrace hard work and loyalty as the foundation of one’s ability to grow professionally within an organization. They also tend to credit the cultivation and maintenance of interpersonal relationships as having a vital influence on their career development.
Baby Boomers, categorized by the surge of babies born post-World War II between the years of 1946 and 1964 began entering the workforce as the Civil Rights Act of 1964 was passed. Women from the Baby Boomer generation joined the workforce in unprecedented numbers. That, combined with the sheer size of this generation, meant that it dominated the overall workforce for many years.
Unlike their immediate predecessors, Baby Boomers are more apt to leave employment for the proverbial “greener pastures” of a new professional opportunity. Renowned for materialism, and nicknamed the “me” generation, has a penchant for accelerating career growth in the quest to earn as large of an income as possible in the shortest amount of time. At times, this results in a personality clash with regard to the relationships and attitudes toward job loyalty between the Baby Boomers and the Traditionalists.
Generation X is notoriously smaller than its immediate predecessor is the first generation whose majority was raised in a two-income household. With the costs of personal computers becoming more affordable, personal computers became a staple in most households, and, Generation X children were provided an advantageous opportunity in acquiring familiarity with technological equipment from a young age and have experienced a shorter learning curve in working with computer technology.
Even more so than the Baby Boomers, Generation X, tends to have an increasingly relaxed attitude toward changing jobs and careers. The conflicts between this group and the Traditionalists, especially, arise from the differing values in communications styles. The younger generation typically chooses electronic communication versus the personal interaction favored by the Traditionalists. In addition, the employer loyalty espoused by the Traditionalist workers is practically nonexistent in the Generation X population.
Generation Y, or the Millenials, includes those born in 1980 and later and is both larger and more tech-savvy than Generation X. Computers and technology have been a component of their entire lives.
These workers are technically adept, highly sophisticated and expect immediate feedback and responses.
Their focus on work-life balance, rather than reaping financial rewards, as well as their desire to receive constant feedback, creates challenges between the Millennials and the three older generations who were not as reliant on continuous communication between managers and their subordinates. Generation X workers, for example, generally embrace a “no news is good news” mantra with regard to communication between supervisors and their direct reports. Generation Y workers generally seek continuous feedback and rewards.
Four generations in one work force creates a great challenge for management teams and HR professionals. By understanding the differences in the generational attitudes as well as establishing how they can collaborate and benefit from one another, an employer will be able to implement a strategy that focuses on each group’s strengths and achieve a competitive workplace advantage.
Tool of the Month:
Bring Your Own Devices Policy
Does your organization allow employees to use their personal cellphones, laptops, etc. for business use? If so, we recommend you implement a Bring Your Own Devices (BYOD) policy to ensure employees are still adhering to your usage and security policies while completing company business on their devices. You can find the BYOD Policy in the HR Support Center, in the Essentials Tab, within the Policy Library in the drop down menu. Feel free to customize this month’s tool for your organization’s needs.
