Hunton Employment & Labor Perspectives

The Patient Protection and Affordable Care Act requires that employers report the aggregate cost of “applicable employer-sponsored coverage” on Form W-2.  (See our August 6, 2012, posting entitled “Reminder – 2012 Form W-2 Reporting For Group Health Plans” for an explanation of this requirement.)  Applicable employer-sponsored coverage generally includes coverage under any group health plan made available to employees by an employer that is excludable from gross income.  In providing an enumerated list of the types of coverage that are exempt from the reporting requirement, the Internal Revenue Service explained in Notice 2012-9 (Q&A-12) that the term “applicable employer-sponsored coverage” generally does not include any coverage for HIPAA-excepted benefits, other than coverage for on-site medical clinics.

Those employers hoping for an appellate court decision on President Obama’s controversial “recess” appointments to the National Labor Relations Board will have to wait a while longer.  In Richards v. NLRB, 7th Cir. No. 12-1973 (decision issued December 26, 2012), the Seventh Circuit sidestepped a ruling on the “recess” appointment question by denying the employer’s petition for review on standing grounds.

As a result of the National Labor Relations Board’s (the “Board”) decision in Latino Express, Inc., 359 NLRB No. 44 (Dec. 18, 2012), employers will now have greater obligations in cases where individuals are awarded lump-sum backpay.  Making good on its earlier promise, the Board held that employers must reimburse individuals for any additional federal or state income taxes, which may result when a lump-sum backpay award covers more than one calendar year.  The Board also held that employers must submit appropriate documentation to the Social Security Administration (“SSA”) so that backpay is allocated to the appropriate calendar quarters.  The Board’s decision follows, a March 2011 memorandum issued by Acting General Counsel, Lafe Solomon, in which he addressed both of these issues instructing Regions to seek a remedy with a tax component in cases involving lump-sum backpay as well as a remedy requiring employers to notify the SSA of the appropriate periods for allocating backpay.

Beginning January 1, 2013, employers must issue an updated notice form to applicants and employees when using criminal background information under the federal Fair Credit Reporting Act.

Beginning in 2014, sponsors of self-insured group health plans (and insurers for insured group health plans) will be required to pay an annual fee to fund the Transitional Reinsurance Program under the Patient Protection and Affordable Care Act.  The Department of Health and Human Services (HHS) recently proposed additional regulations for this program.  Here is a quick overview of how the program will work under the proposed rules.

California’s Fair Employment and Housing Commission recently amended its regulations to the state’s Pregnancy Disability Leave Law.  The new regulations provide expanded protections and clarifications with regard to employer obligations related to Pregnancy Disability Leave (“PDL”).  The regulations take effect on December 30, 2012.

The U.S. Equal Employment Opportunity Commission (the “EEOC”) recently approved a new Strategic Enforcement Plan to establish national enforcement priorities and provide more transparency for employers who may find themselves the subject of EEOC investigations.  After soliciting public and internal recommendations, the EEOC approved a plan that identifies six specific areas in which the agency believes increased enforcement will result in the most change. 

Implementation of the health care reform law now appears to be a certainty. We have already begun to see a flood of regulations creating new rules around the law’s implementation requirements, most of which will occur in 2013 and 2014.

In order to meet the burgeoning needs and concerns of our clients, the Hunton & Williams Health Care Reform team will be presenting a series of webinars over the coming months.

Please join us for the first in the series
 
Health Care Reform Is Here to Stay – What Do Employers Do Now?

Thursday, January 17, 2013
1:00 – 2:30 p.m. EST

On December 6, 2012, New Jersey Assembly Bill 3581 was introduced and referred to the Assembly Budget Committee.  The Bill would amend New Jersey’s current statute concerning enforcement, penalties and procedures for law regarding failure to pay wages and provide for enhanced penalties, among other things.  The Bill is part of the Assembly’s recent push to promote job creation and economic development through a series of legislative initiatives.

The Second Circuit this week overturned the conviction of a pharmaceutical sales representative for conspiracy to engage in “off-label” marketing in violation of the Food, Drug & Cosmetic Act (the “Act”) in a decision that has implications for “whistleblower” cases brought against pharmaceutical employers by their employees.  In United States v. Caronia, No. 09-5006-cr, 2012 WL 5992141 (2d Cir. Dec. 2, 2012), a divided panel held that the Act could not be interpreted to criminalize truthful “off-label” marketing because such a reading would render the Act an unconstitutional violation of the drug manufacturer’s First Amendment rights.  “Off-label” marketing occurs when a drug or device is approved for one purpose but is marketed for other, non-approved purposes.