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EEOC Updates on How to Use Background Checks

Cornerstone — Mon, 07 May 2012 16:32:15 +0000

For years, the Equal Employment Opportunity Commission (EEOC) has taken the position that making employment decisions solely based on an applicant’s criminal record may violate Title VII guidelines. Additionally, they have argued that such decisions may result in disparate impact. Recently, the (EEOC) issued an updated Enforcement Guidance with regards to how employers should use background checks in conjunction with hiring, terminations and other employment decisions.

Below is a brief overview that all employers should review:

Eliminate all “catch-all” policies or verbiage. (i.e. the company will only hire those candidates with no criminal record).
Review each candidate and situation on a case by case basis. Identify the nature & gravity of the criminal offense, the time passed since it occurred, the sentence completed, and the nature of the job in question. Someone applying for a receptionist job who was convicted of a DUI 10 years ago should not be overlooked for that one offense. However, someone applying to work in a day care who was arrested for a sexual offense 2 year ago may not be the best candidate.
Review what requirements are “job related and consistent with business necessity”. Does someone who’s sitting at a desk all day really need to have a clean driving record? Probably not. But the person who’s responsible for driving your delivery truck should at least have a recent clean record. Will that speeding ticket from 1996 matter? Doubtful.
Remove blanket questions on your application or interview process that ask if the candidate has ever been convicted of a crime. Simply answering “yes” to such a question does not provide sufficient enough information as to whether or not the conviction is job related, or if the crime was severe or recent enough to warrant concerns about continued unsavory conduct or behavior.

Should you have additional questions, please contact Bethany Holliday, TotalHR Director at 314-373-2982 or bethanyh@cornerstoneinsurancegroup.com

6 Common Mistakes When Dealing with FLSA

Cornerstone — Tue, 24 Apr 2012 19:32:31 +0000

6 Common Mistakes When Dealing with FLSA:

Even though the Fair Labor Standards Act was passed in 1938, many employers still struggle with complying with the regulations. Below are 6 common mistakes a number of employers make:

Allowing “comp time”. While it may seem that all employers will allow an employee to have an extra vacation day in exchange for working on Saturday, or perhaps leave early on Friday as a reward for staying late Thursday, true comp time in lieu of paying overtime is not allowable in the private sector. In fact only state or local government employers, with the agreement of the employees are allowed to provide nonexempt employees with compensatory time off.
Automatically paying OT for Weekends. Having an employee work on Saturday or Sunday is not an automatic overtime check. Employers need to establish when their week starts & ends – most weeks run Sunday through Saturday or Monday through Sunday. Overtime is paid for hours worked in excess of 40 in that week.
Failing to pay overtime without prior authorization. If an employee works overtime, you’re stuck holding the bill. Punishing the employee by withholding the pay is not the way to go. Instead, establish a policy that discusses how overtime will be approved & inform employees that it needs to be approved prior to working it. Failure to obtain appropriate approvals may result in disciplinary action, but never withholding pay.
Assuming the job title is what matters. If I wanted to, I could title myself Queen of all the World, but it doesn’t necessarily make it so. Just because you call an employee a “Manager”, “Director” or “Supervisor”, doesn’t mean they are performing job functions of such. Determining whether an employee is exempt or non-exempt relies on what the employee is actually doing – not their title.
Assuming “Salaried” means “Exempt”. Many employers choose to pay employees a regular salary if, for nothing else, the convenience of it. However, just because you have an employee earning an annual salary does not mean they are performing a job making them exempt from earning OT (See above re: job titles). A number of job functions can, and often are, salaried non-exempt roles – receptionist, administrative assistant & accounting clerks are a few examples.
Reducing exempt level pay for partial days. Exempt level employees are expected to get the job done whether they are working 35, 40, 50 or more hours per week. Part of being exempt means they do not earn overtime when they are working more than 40 hours. Part of the danger with reducing pay when they work less than 40 hours is that you, the employer, jeopardize their status as true exempt level employees.

If you read any of the above & thought “oops!”, it may be time to reevaluate how you are handling your pay, job descriptions & time off. Should you have any additional questions, please contact Bethany Holliday at 314-373-2982 or bethanyh@cornerstoneinsurancegroup.com

OSHA Revises HazCom Standard to Align with GHS

Cornerstone — Mon, 26 Mar 2012 16:08:20 +0000

On March 20, 2012, OSHA filed a final rule with the Federal Register revising the manner in which employers are required to communicate chemical hazards to their employees. The rule, which will take effect in stages through 2016, was written to align the American system with the Globally Harmonized System of Classification and Labeling of Chemicals, commonly referred to as GHS. The new rule adjusts the way chemical labels and material safety data sheets (which will be referred to simply as safety data sheets moving forward) are written to better communicate hazards to employees. These changes are expected to affect 40 million workers at 5 million American workplaces

CHANGES TO THE HCS

The new HCS still requires chemical manufacturers and importers to evaluate the chemicals they produce or import and provide hazard information to employers and workers by putting labels on containers and preparing safety data sheets.

However, the old standard allowed chemical manufacturers and importers to convey hazard information on labels and material safety data sheets in whatever format they chose. The modified standard provides a single set of harmonized criteria for classifying chemicals according to their health and physical hazards and specifies hazard communication elements for labeling and safety data sheets.

Major changes include:

Hazard classification: Chemical manufacturers and importers are required to determine the hazards of the chemicals they produce or import. Hazard classification under the new, updated standard provides specific criteria to address health and physical hazards as well as classification of chemical mixtures.

Labels: Chemical manufacturers and importers must provide a label that includes a signal word, pictogram, hazard statement, and precautionary statement for each hazard class and category.

Safety Data Sheets: The new format requires 16 specific sections, ensuring consistency in presentation of important protection information.

Information and training: To facilitate understanding of the new system, the new standard requires that workers be trained by Dec. 1, 2013, on the new label elements and safety data sheet format, in addition to the current training requirements.

OSHA made limited changes to the proposed rule it had issued previously. Changes related to labeling include flexibility regarding required statements to allow label preparers to consolidate or eliminate inappropriate or redundant statements. The final rule also allows for longer deadlines for full implementation.

CHEMICAL USER AND PRODUCER RESPONSIBILITIES

Responsibilities under the revised HCS will depend on whether an organization is a chemical user or a chemical producer.

Chemical users must continue to update safety data sheets when new ones become available, provide training on the new label elements and update hazard communication programs if new hazards are identified.

Chemical producers must review hazard information for all chemicals produced or imported, classify chemicals according to the new classification criteria and update labels and safety data sheets.

EFFECTIVE DATES

Effective Completion Date	Requirement(s)	Who
Dec. 1, 2013	Train employees on the new label elements and SDS format.	Employers
June 1, 2015 Dec. 1, 2015	Comply with all modified provisions of this final rule, except: Distributors may ship products labeled by manufacturers under the old system until Dec. 1, 2015.	Chemical manufacturers, importers, distributors and employers
June 1, 2016	Update alternative workplace labeling and hazard communication program as necessary, and provide additional employee training for newly identified physical or health hazards.	Employers
Transition Period	Comply with either 29 CFR 1910.1200 (the final standard), or the current standard, or both.	All chemical manufacturers, importers, distributors and employers

Need for Standard Regulations

Prior to the adoption of the GHS by the United Nations in 2003, different countries had many different regulatory systems related to hazard communications. There are a number of disadvantages to these varying standards, including:

Diverse and conflicting requirements created confusion for employers required to provide hazard information to employees;
Labels and safety data sheets may have included symbols and hazard statements that were unfamiliar to readers or not well understood; and
Containers may have been labeled with such a large volume of information that important statements were not easily recognized.

Development of multiple sets of labels and safety data sheets was a major compliance burden for chemical manufacturers, distributors, and transporters involved in international trade. Small businesses had particular difficulty in coping with the complexities and costs involved.

Adoption of the GHS

As a result of the issues outlined above, and in recognition of the extensive international trade in chemicals, there has been a long-standing effort to harmonize these requirements and develop a system that can be used around the world. In 2003, the United Nations adopted the GHS. The new system is being implemented throughout the world by countries including Canada, the European Union, China, Australia and Japan.

In the United States, the adoption of the GHS followed this timeline:

September 2009: OSHA published a proposed rulemaking on to align OSHA’s HCS with the GHS.
March 2010: OSHA held public hearings regarding the proposal.
Oct. 25, 2011: After extensive notice and comment, the Office of Management and Budget (OMB) received the final rule on for a 90-day review.
Jan. 24, 2012: The 90-day deadline expired and the OMB extended the review of the final rule until further notice.
March 20, 2012: The final rule was filed with the Office of the Federal Register for publication on March 26, 2012.

The Department of Transportation (DOT), Environmental Protection Agency, and the Consumer Product Safety Commission actively participated in developing the GHS. DOT has already modified its requirements for classification and labeling to make them consistent with United Nations transport requirements and the new globally harmonized system.

EFFECT OF THE revised HCS

Over five million workplaces and over 40 million workers will be affected by the changes to the HCS. OSHA estimates the revised standard will prevent 43 fatalities and 521 injuries and illnesses annually.

The annualized monetized benefits associated with the final rule’s reductions in safety and health risks are an estimated $250 million a year. OSHA estimates additional annualized benefits of $507 million a year from cost reductions and productivity improvements. OSHA also anticipates that the final rule will generate substantial savings from simplified hazard communication training and from expanded opportunities for international trade due to a reduction in trade barriers.

The estimated cost of the final rule is $201 million annually. The costs includes reclassification of all chemicals, additional training of workers on the new labeling system and familiarization with the modified HCS standard.

More information

More information on the hazard communication standard, including the link to the Federal Register notice, can be found on OSHA’s hazard communication safety and health topics page at www.osha.gov/dsg/hazcom/index.html.

A Valuable Tax Credit for Small Businesses

Cornerstone — Tue, 13 Dec 2011 17:07:11 +0000

As the year draws to a close our minds go forward to limiting our tax exposures. This tax credit for healthcare costs is a great way for small businesses to do just that. Click on the link to read more about this valuable credit for small businesses.

http://www.uhc.com/united_for_reform_resource_center/health_reform_provisions/small_business_tax_credit.htm

Conquering the Challenges of a Wellness Program

Cornerstone — Wed, 19 Oct 2011 16:35:57 +0000

Today’s business environment is challenging and employers need all the help they can get to remain competitive and profitable. Employers are looking for ways to cut costs, and health care costs are often an area to find savings for most businesses. Wellness research is still in the infancy stages, but the growing body of evidence seems to indicate the savings from a wellness program come not only from containing direct medical costs, but an increase in productivity, reduced absenteeism, lower turnover and recruiting cost and improved employee morale. When implementing a health and wellness program many employers face some challenges that are fairly easy to overcome.

Challenge: Employee Engagement
• Getting employees engaged in health and wellness programs can be a challenge. The one-size-fits all philosophy does not work with wellness because health is individualized. Some people may want to meet regularly to lose weight, whereas others may need stress management services, smoking cessation programs. We see programs fail when they are not aligned with what the employee’s want.
Challenge: Wellness is Expensive
• Employers are often fearful of the costs associated with implementing a wellness program because they don’t see how it will help them control direct medical costs. There are many low cost ways to implement a wellness program by leveraging carrier resources or other low cost resources within the community. The end the question should be how much will it cost by NOT investing in a wellness program?
Challenge: High Employee Turnover Rate
• Employee turnover is expensive! 40% of US workers change jobs every five years. By implementing a wellness program you can reduce turnover through employee loyalty. Company sponsored workplace wellness programs send a clear message to employees that management values their well-being.
Challenge: Wellness Takes Time• To encourage employees to participate wellness needs to be made convenient to them; this often means allowing time during the work day. While this may initially impact short-term productivity in the long run healthier and happier employees will be less likely to miss work and more productive when they are at work. Research by Goetzel et al suggests presenteeism costs are higher than medical costs in most cases by 18-60% depending on the medical condition.

Businesses who implement wellness as a core value will reap the distinct competitive advantage of having a healthy, high-performance workforce.

Anderson, D. Give Your Benefits a Boost With Wellness. CDHC Solutions. 2009 May.
Goetzel, R. et al. Health, Absence, Disability, and Presenteeism Cost Estimates of Certain Physical and Mental Health Conditions Affecting U.S. Employers. J Occup Environ Med. 2004:46:398-412
Nicholson, S. et al. How to Present the Business Case for Healthcare Quality to Employers. 2005 November
Taggart, N. A New Competitive Advanctage. Benefits & Compensation Digest. 2009 June.

Updated NLRB Requirement

Cornerstone — Fri, 07 Oct 2011 20:02:26 +0000

The NLRB issued a notice October 5, 2011 advising that they are delaying the requirements of most employers to display an 11 x 17 poster informing employees of their right to form a union. The original deadline for employers was November 14th, and the new deadline is January 31, 2012. As the reason for the delay, the NLRB cited confusion from companies who were unsure if they were subject to NLRB jurisdiction, explaining that a number of primarily small to medium sized companies were unaware if they were covered under the ruling. As a result, the NLRB has indicated they plan to have additional outreach and educational programs to help companies better understand the NLRB, their role and the poster.

As previously mentioned, there is still litigation pending which is seeking to block this ruling overall. Should additional changes or updates occur between now and January 31st, we will update you accordingly.

Wellness and Employee Retention

Cornerstone — Wed, 05 Oct 2011 19:15:16 +0000

Increasing evidence supports the need for employee wellness programs – lower health care costs, increased productivity, and reduced absenteeism. But what about employee retention rates? Retention rates vary greatly from company to company. The companies with the highest retention rates have one common denominator – happy employees!

The extent to which an employee is happy and comfortable with his or her job is the single best determining factor in high retention rates. Employee turnover is expensive and employers are always looking for ways to keep employees at their organization for longer periods of time, but many overlook the impact of a wellness program on happy and healthy employees.

With rising health care costs, concerns about employee health are already high among employers. Research shows that over 70% of health care spending is attributable to modifiable lifestyle behaviors. In any given workforce, these problems are increasingly found on a larger scale. If there is any illness or problem affecting an individual at work, the quality of work will be adversely affected. Thus, the employee’s health is an important factor in determining retention rates.

Proof is in the numbers a recent survey conducted by Principal Financial found that 45% of Americans working in small to medium size companies (10 – 1,000 lives) would stay at their jobs longer because of employer-sponsored wellness programs. Wellness programs are generally designed to do two things: create an awareness of health by identifying health risks and offer a solution. The solution may include education on nutrition, stress management programs, smoking cessation programs…the list is endless. Once we encourage employees to take control of their health, the company will begin to see changes within the organization.

How does something as simple as nutrition education help a company benefit in regards to employee retention? Company sponsored wellness programs send a message to the employees that management values their well-being. Employees will feel taken-care-of when such programs are implemented and this will increase the employee’s commitment towards their work through increases in productivity and efficiency.

Wellness programs are a win-win situation. Employers win by retaining top talent, reducing absenteeism, increasing productivity, reducing health care costs and most importantly employees are healthy and happy! No company will be successful in the global marketplace without healthy and productive people.

New NLRB Requirement

Cornerstone — Thu, 22 Sep 2011 19:25:18 +0000

A new NLRB requirement….. By now, many of you may have heard about a recent ruling from the NLRB (National Labor Relations Board) requiring most private-sector employers to notify employees of their rights under the National Labor Relations Act. Many employers are calling this the “How To Form a Union” poster, as both union AND non-union employers are required to post the document. Currently there is pending litigation attempting to stop this rule from going into effect; however unless the courts rule to the contrary, employers should have the required notice ready for posting in appropriate sites on November 14, 2011 – when the final rule takes effect.

Employers will be required to post the NLRB poster in the same place that other required workplace posters are, or electronically post, if that is how the company notifies their employees of information. This does not mean an email distribution, but rather an online data warehouse where policies or workplace documents are stored.

The required workplace poster is now available for free download from the NLRB website.

Where Are We With Healthcare Reform?

Cornerstone — Tue, 30 Aug 2011 14:49:43 +0000

A number of legal challenges have been filed in various federal courts since the health care reform law was passed in March 2010. While some of the challenges have been decided based on procedural grounds, the main substantive controversy has been whether Congress had the constitutional authority to pass the individual mandate under health care reform. Beginning in 2014, the individual mandate generally requires individuals to purchase health insurance or pay a penalty. The individual mandate is a key component of the health care reform law. Health care policy experts have suggested that, without the individual mandate, health care reform’s other insurance market reforms would be difficult to implement.
COURT RULINGS
So far, there have been at least 30 lawsuits filed by state governments, private citizens and others seeking to overturn the health care reform law. The court rulings, to date, are split. Some courts have upheld the law as constitutional, while others have concluded that a portion of the law, or the entire law, is unconstitutional. For example, one federal district court in Virginia ruled that the individual mandate portion of the law is unconstitutional. Other federal district courts, including one in Michigan and another Virginia court, found that the law is constitutional.
In January 2011, a federal district court in Florida ruled that Congress does not have the authority to require individuals to buy insurance. The Florida district court went further than others that have reviewed the law, holding that the individual mandate cannot be separated from the rest of the law, so the entire statute is invalid. The Florida court issued a stay of its decision while the case proceeds through the appeals process.
The 4th, 6th and 11th U.S. Circuit Courts of Appeal have heard appeals of health care reform challenges, and challenges are currently pending before other U.S. Courts of Appeals. In June 2011, the 6th Circuit Court of Appeals upheld the constitutionality of the individual mandate. The 4th Circuit Court of Appeals is expected to issue its decision soon. The 11th Circuit appeal has received the most attention because it involves the controversial Florida decision invalidating the entire law and includes Republican attorneys general and governors from 26 states.
On Aug. 12, 2011, the 11th Circuit Court of Appeals ruled that the health care reform law’s individual mandate is unconstitutional, upholding the Florida district court decision. However, the Court of Appeals overturned Florida’s decision to invalidate the entire law, preferring to strike only the individual mandate. The Court of Appeals stated that Congress violated the U.S. Constitution by passing legislation that would force all Americans to buy a product or pay a penalty. The opinion said Congress has broad power to deal with the problems of the uninsured, “but what Congress cannot do…is mandate that individuals enter into contracts with private insurance companies for the purchase of an expensive product from the time they are born until the time they die.”
WHAT’S NEXT?
Now that two federal appeals courts have reached differing conclusions on the constitutionality of the health care reform law, the issue may proceed to the U.S. Supreme Court. The Justice Department will have 90 days to appeal to the Supreme Court or ask the entire 11th Circuit to review the ruling. The decision of the 6th Circuit Court of Appeals, which upheld the individual mandate as constitutional, has already been appealed to the Supreme Court. It is likely that the constitutionality of the health care reform law will ultimately be settled by the Supreme Court.

The Cornerstone Insurance Group will continue to monitor the status of the health care reform law and its impact on you and your employees.

What is The Patient Protection and Affordable Care Act?

admin — Mon, 08 Aug 2011 13:06:21 +0000

The Patient Protection and Affordable Care Act (PPACA) is a federal statute that was signed into law by President Barack Obama on March 23, 2010. This act along with the Health Care and Education Reconciliation Act of 2010 (signed into law on March 30, 2010) make up the health care reform of 2010. Together the laws focus on reform of the private health insurance market, providing better coverage for those with pre-existing conditions, making healthcare more affordable for those that financially qualify, improving prescription drug coverage in Medicare and extending the life of the Medicare by approximately 12 years.

What is included in the law?

The law includes numerous health-related provisions that take effect over the next several years, beginning last year in 2010. Some of the major provisions include:

Guaranteed issue and community rating will be implemented nationally so that insurers must offer the same premium to all applicants of the same age, sex, and geographical location regardless of pre-existing conditions.
Health insurance exchanges will form in each state, offering a marketplace where individuals and small businesses can compare policies and premiums, and buy insurance.
Firms employing 50 or more people but not offering health insurance will pay a “shared responsibility payment” if the government has had to subsidize an employee’s health care.
Non exempt persons not securing minimum essential health insurance coverage are also fined under the shared responsibility rules. This requirement to maintain insurance or pay a fine is often referred to as the individual mandate, though being insured is not actually mandated by law.
Improved benefits for Medicare prescription drug coverage are to be implemented.
Medicaid eligibility is expanded to include all individuals and families with incomes up to 133% of the poverty level.
Low income persons and families above the Medicaid level and up to 400% of the poverty level will receive subsidies on a sliding scale if they choose to purchase insurance via an exchange.
Very small businesses will be able to get subsidies if they purchase insurance through an exchange.
Establishment of a national voluntary insurance program for purchasing community living assistance services and support.
The law will introduce minimum standards for health insurance policies and remove all annual and lifetime coverage caps.
Policies issued before the law came into effect are “grandfathered” and are mostly not affected by the new rules.
How will it be funded?

The Act’s provisions are designed to be funded by a variety of taxes and offsets. Major sources of new revenue include Medicare tax on incomes for individuals earning over $200,000 and joint filers over $250,000, an annual fee on insurance providers, and a 40% tax on “Cadillac” insurance policies. There are also taxes on pharmaceutical companies, high-cost diagnostic equipment makers, and a federal sales tax on indoor tanning services.

How are legal challenges impacting the law?

Organizations and lawmakers who opposed the passage of the bill have taken legal action against it and several court challenges are currently at various stages. The targets of the threatened lawsuits are several key provisions of the bill, but most focus on the “individual mandate”. A total of 28 states have filed joint or individual lawsuits (including 26 states engaged in a joint action) to overturn the individual mandate portions of the law, arguing that fining individuals for failing to buy insurance is not within the scope of Congress’s taxing powers. Members of several state legislatures are attempting to counteract and prevent elements of the bill within their states, and legislators in 29 states have introduced measures to amend their constitutions to nullify portions of the health care reform law. It is likely that the constitutionality of the bill will be challenged before the Supreme Court sometime within the next year or so.