Each year brings a new set of laws for employers to comply with, and this year is no exception. Below is a summary to assist employers in negotiating the maze of new laws and to give you a preview of what else to expect in 2010.
New statutes and regulations- Alternative workweek schedules. Labor Code §511 has been amended to make it easier for employers to create alternative workweek schedules, such as four-day/10-hour schedule without having to pay overtime. The amendments provide better definitions of work units, allow a work unit with only one employee where appropriate, allow a traditional 5/40 workweek to be one of the menu options and allow employees to move from one schedule to another on a weekly basis.
To do: If your employees regularly work overtime, consider an alternative workweek to cut your payroll costs.
- Genetic Information Nondiscrimination Act. Effective Nov. 21, 2009, employers must begin to comply with the Genetic Information Nondiscrimination Act (GINA). Under GINA, it is illegal to discriminate against employees or applicants because of genetic information. GINA prohibits the use of genetic information in making employment decisions, restricts acquisition of genetic information by employers and other entities covered by Title II and strictly limits the disclosure of genetic information.
To do: Update your employee handbook policy to include this new law, and replace the posters in your break room. The new poster is available at www1.eeoc.gov/employers/poster.cfm
- Lily Ledbetter Fair Pay Act. The Fair Pay Act extends the time for filing an unfair pay claim. Under the new law, the time begins to run each time an employee receives a paycheck that violates the act, instead of running from the time the initial discriminatory pay decision was made.
- Workers’ compensation. The law allowing employees to pre-designate their personal physician of choice as the first medical provider in case of a workplace injury has been extended permanently. If a worker does not pre-designate in writing, the employer may direct the worker to its designated medical provider network. In addition, the penalty for failing to carry workers’ compensation insurance has increased by at least 50 percent.
To do: Be sure you have workers’ compensation insurance and a designated medical provider network so you know where to send your employees in the event of a workplace injury.
- Increased tax withholding. As of Nov. 1, 2009, employers were required to start using a new state income tax withholding table, increasing by 10 percent the amount of income taxes withheld based on existing claimed exemptions. In addition, as of Jan. 1, 2010, there is a 7 percent backup withholding for certain payments to independent contractors, where back-up withholding is otherwise generally required under the Internal Revenue Code.
To do: Work with your payroll service or internal payroll department to make sure it is aware of and complying with the new withholding tables. Work with employees to submit revised W-4 and DE-4 forms if the new tables would result in excessive tax withholding.
- COBRA subsidy. In early 2009, as part of the stimulus package, employees who were involuntarily terminated between Sept. 1, 2008, and Dec. 31, 2009, could continue health care coverage through COBRA by paying only 35 percent of their premiums for up to nine months. The remaining 65 percent is paid by employers, who may deduct the cost from federal payroll taxes. Congress is currently considering legislation that would extend the end-of-year cut off, increase the subsidy from 65 percent to 75 percent, and extend benefits from nine to 15 months.