Compliance Update – October 2019
Every month, Lincoln puts together the latest compliance news related to family and medical leave laws and regulations – helping you keep track of the important deadlines, compliance considerations and links to additional information.
Family and medical leave
From the courts
Federal Family and Medical Leave Act (FMLA)
September 10, 2019
The United States Department of Labor (DOL) issued Opinion Letter FMLA 2019-3-A that states that an employer may not delay designating paid leave as FMLA leave even if the delay complies with a collective bargaining agreement (CBA) and the employee prefers that the designation be delayed. As previously stated by the DOL in Opinion Letter FMLA 2019-1-A, once an eligible employee communicates a need to take leave for an FMLA-qualifying reason, an employer may not delay designating such leave as FMLA leave, and neither the employee nor the employer may decline FMLA protection for that leave. Employers may adopt a leave policy where as soon as they become aware that an employee needs leave for an FMLA-qualifying reason, they may require that when the employee takes CBA-protected accrued paid leave, such leave will be designated as FMLA leave, i.e., that the leave is concurrently CBA-protected paid leave and FMLA leave. The DOL reiterated that FMLA applies in addition to or along with an employer's polices or any CBAs. Employers may adopt, retain, or amend leave policies, including policies that provide more generous leave, as long as they comply with the FMLA. The terms of any employment practice, policy, benefit program, or plan, including a CBA, may not reduce or deny FMLA benefits and protections.
Washington Q1 and Q2 reports were due August 31, 2019 and the reporting period remained open throughout September. The Employment Security Department (ESD) is aware of technical issues during reporting and has announced that the state will not be assessing penalties or interest for employers having trouble reporting Q1 or Q2 reports or payments submitted after Aug. 31, 2019 at this time. Please consult the Washington PFML reporting website or contact the ESD for further information.
September 5, 2019
The Department of Paid Family and Medical Leave (DFML) has released guidance on the DFML website on when 1099-MISC workers should be included in a business’s workforce count and whether the business needs to report them for the purposes of the PFML program.
For a 1099-MISC worker to be considered a part of the business’s Massachusetts workforce count, the 1099-MISC contractor must: (1) perform services as an individual entity; (2) live in Massachusetts; (3) perform services in Massachusetts; and the 1099-MISC worker must not be an independent contractor as defined by the Massachusetts unemployment statute.
Massachusetts 1099-MISC workers only count toward the total number of covered individuals for purposes of contributions and reporting only if they make up more than 50% of the business’s total Massachusetts workforce (MA W-2 employees and MA 1099-MISC workers combined). Otherwise, an employer is not required to contribute or report on 1099-MISC workers.
September 16, 2019
New Jersey released their 2020 Temporary Disability Insurance (TDI) plan updates. These annual updates align with legislation the state passed earlier in 2019 to increase the taxable wage base on 1/1/2020 and to increase the weekly benefit on 7/1/2020. To limit the increase in employer cost under the state plan due to the significant benefit increase, the state will require the additional cost to be funded solely by employees. Although this change was primarily intended for state plan participants, private plan employers may also utilize the higher employee contributions which will likely shift the overall employee vs. employer costs under a private plan. It’s also important to note that while employee contributions will increase in 2020, employers will still be responsible for all private plan costs that exceed those contributions.
|2020 New Jersey TDI plan updates|
|Maximum weekly benefit||7/1/20 – 12/31/20: Will increase to $881|
|Maximum benefit percentage||1/1/20 – 6/30/20: Remains at 66 2/3%
7/1/20 – 12/21/20: Will increase to 85%
|Maximum employee contribution rate||0.26% (up from 0.17%)
Maximum deduction: $350.74 (up from $58.48)
|Taxable wage base||Employer - $35,300 (up from $34,400)
Employee - $134,900 (New this year)
Note: In previous years, these amounts were equal, but are now separate due to recent legislation changes.
We will have further communication on the implications of these changes to Lincoln’s inforce and new business.
October 4, 2019
A law mandating the automatic processing of an application for paid family leave became effective on October 4, 2019. Passed in November 2018, NJ Assembly Bill No. 2762 provides that when a covered individual applies for temporary disability benefits for disability resulting from pregnancy or the birth of a child, the plan administering benefits must automatically process an application for that individual to its paid family leave benefits program, unless the individual affirmatively opts out of that program. This applies to both the State plan and private plans that offer both temporary disability and family leave benefits. A private plan that offers only temporary disability benefits is required to provide claimants with written notice of the application process for family leave benefits concurrently when issuing written approval of temporary disability benefits.
From the courts
An accommodation to telework requires a context-specific inquiry and is not a legal entitlement under the ADA. The Seventh Circuit ruled that the United States Department of Housing and Urban Development (HUD) did not fail to offer an employee reasonable accommodations or engage in the interactive process in good faith when the employee requested to work from home and HUD presented her instead with appropriate alternative accommodations. HUD offered the employee a four-day work week, generous leave approval (to ease commuting and attending physical therapy), and other accommodations. The court held that an employer must provide a reasonable accommodation, not the accommodation the employee would prefer. Given the restructuring of the department in which she worked and the employee’s updated job description focusing on cross-training, teamwork, and collaboration, which necessarily required her presence in the office, HUD's accommodations were entirely reasonable. The district court held in favor of HUD, and the Seventh Circuit affirmed. (Yochim v. Carson, 935 F.3d 586 (7th Cir. 2019))