Archive for October, 2013

No Change in Pension COLAs, But IRS Ends Strict “Use or Lose” Rule for Health FSAs

It’s the day we all been waiting for. No, not Halloween. I mean the day every year that the IRS raises the contribution levels for pension and retirement plans.

That’s today treat. Except that the IRS did not increase the amount that an employer can tax-defer into his or her 401(k) plan, 403(b) or government 457 plans. Instead, it kept the figure at $17,500–the same as 2013. Why? Because, IRS said, the consumer price index hasn’t gone up enough to warrant an inflation boost in the deferral rate.

But wait- there’s another treat from IRS today. It issued Revenue Procedure 2013-35, in which it ruled for the first time that employees with leftover money in their flexible spending accounts can carry over up to $500 into the next year. It’s no longer strictly “use-or-lose” on those accounts.

Which means employees lucky enough to have a balance in their account in December won’t have to scramble to purchase those extra sunglasses in order to make sure their balance is zero for the new year.

But the trick is that the employer has to amend its plan document to give employees the freedom to carry over money into the new plan year.

Here’s the IRS COLA announcement and Revenue Procedure 2013-35.

DOL Prods Settlement From Government Contractor Over Invalid Employment Test

Using an invalid employment test can prove costly to government contractors.

Almost 400 black, Hispanic, and Asian American applicants will receive $875,000 in settlement of a U.S. Department of Labor employment discrimination complaint against a D.C.-area government contractor, the U.S. Department of Labor’s Office of Federal Contract Compliance Programs announced today.

The OFCCP said it had determined that M.C. Dean Inc. had denied employment to these applicants in 2010 because it had selection procedures, including an invalid test, that unfairly kept these applicants from positions as apprentices and electricians at its Dulles, Virginia headquarters.

The breakdown of monetary recipients is 272 African American, 98 Hispanic and 11 Asian American applicants.

The $875,000 in back pay is only one element of the settlement. In addition, M.C. Dean agreed to extend 39 jobs offers to the class members as opportujities become available. The contractor also agreed to undertake extensive self-monitoring measures and personnel training  to ensure that all of its employment practices fully comply with Executive  Order 11246, which prohibits federal contractors and subcontractors from discriminating in employment on the basis of race, color and national origin.

As a reminder, any test a government contractor–or any employer–uses must be valid, meaning related to the job and required by a business necessity.

This settlement should be a wake up call to other contractors and employers to review their tests to make sure that they do not prevent minority applicants from getting a fair shot at a job.

Read more from the OFCCP.

Deaf Applicant’s Rights Violated, EEOC Says in Announcing ADA Settlement With Toys “R” Us

A deaf applicant for a job at a Toys “R” Us store in Columbia, Maryland, deserved better than to be denied hiring for a job for which she was qualified. That was the EEOC’s conclusion in today’s announcement that it had settled its ADA lawsuit agianst the toys retalier on the applicant’s behalf.

According to the EEOC’s suit, after Shakkira Thomas applied for the job, Toys “R” Us contacted her and requested that she attend a group interview.  After Thomas’s mother told Toys “R” Us that Thomas was deaf and requested that it provide an interpreter for the interview, the retailer said that Thomas would have to provide her own interpreter for the interview.  Thomas communicates by using American Sign Language, reading lips and through the written word.

Thomas’s mother interpreted for her during a group interview, but the retailer refused to hire Thomas despite her qualifications and ability to perform the team member position, with or without a reasonable accommodation, the EEOC charged.

That was an ADA violation, the EEOC contended, since absent an undue hardship, the ADA requires providing a reasonable accommodation to job applicants and employees who request one.

In addition to the monetary relief, Toys “R” Us will provide training on the ADA, including non-discriminatory interviewing and hiring practices, to managers and supervisors at its Columbia store and at 24 other stores in Maryland and Pennsylvania, the EEOC said.

Read more about the settlement.

India Grapples With Workplace Harassment

The Indian parliament took its first serious step in workplace harassment prevention when in April it passed a new law prohibiting sexual harassment. As with any law, its success or failure will depend on how seriously employers take it and whether employees who believe they have been victims of harassment feel empowered to complain about it and get an adequate response.

Indian society has a steep climb in getting a handle on this problem. Workplaces are notoriously hostile to women, and just last December a young student was gang-raped.

In 1977, the country’s supreme court ordered employers to have sexual harassment guidelines. But compliance was inconsistent, limited for the most part to certain blue-chip companies and international firms.

The new law, on the other hand, will get every employer’s attention because it will have some enforcement behind it.

One interesting aspect of the law is that it defines “workplace” to include not only company premises but also an individual’s home or farm.

Every law, of course, exists against the backdrop of the particular society’s mores generally. In India there is an annual Hindue festival celebrating siblings. On this holiday, many women tie threads around their brothers’ wrists, a symbolic gesture of the men’s commitment to protect their sisters.

A female administrator at an Indian hospital adopted that practice for her workplace, tying the threads on the male wrists of her male colleagues and bosses.

How do you think that would go over here if female employees symbolically bound their male co-workers and supervisors to think of them like sisters and shield them from harm?

An interesting idea, I think.

OPM Orders FMLA Leave Rights for Same-Sex Spouses

All federal employees must be allowed to take Family and Medical Leave Act leave to care for a same-sex spouse, the U.S. Office of Personnel Management ruled last week.

In a memo from acting director Elaine Kaplan to all heads of executive department and agency heads, OPM ordered them to stop using the definition of “spouse” in OPM’s current FMLA regulation. That definition incorporates the “one man and one woman” language prescribed by the Defense of Marriage Act, which limited recognized marriages to those between heterosexual couples.

You’ll recall that in June the high court ruled in the Windsor case that the DOMA provision that defined marriage as being between a man and a women violates the U.S. constitution by denying married same-sex couples entitlement to federal benefits.

Following that ruling, the IRS ruled that it would recognize same-sex marriages legally entered into in any state in the United States. Under that “place of celebration” standard, OPM could do little else but throw out the current definition of “spouse” and go with a new definition.

The memorandum applies retroactively, meaning employees can claim the FMLA benefits as far back as June 26 when the Windsor decision was issued.

Other federal government departments and agencies had already taken this step, including the Defense Department, which in August extended its benefits to same-sex spouses.

Employer to Pay $47K to Settle EEOC’s ADA Lawsuit on Behalf of Dyslexic Employee

If an employee tells you that he or is dsylexic, make sure you provide a reasonable accommodation in any job-related training that you require him or her to go through.

That’s the message of today’s announcement by the EEOC that it settled an ADA lawsuit against Dollar General Stores, Inc.

The EEOC charged that Dollar General required the employee–who had dsylexia–to take a series of computer based training followed by a written test. The employee asked for help reading the test due to his dyslexia. His request was denied. Instead of accommodating hih, the store told he could not have any assistance, and that if he did not complete the training and take the test he would be demoted. When he refused to do so without accommodation, he was demoted to a lesser-paid position with reduced hours, the EEOC alleged.

To settle the complaint, EEOC said that Dollar General agreed to pay $47,000, of which $40 was back pay and the rest was compensatory damages.

Dollar General also agreed to provide training to all of its store managers in the district explaining the requirements of the ADA and the interactive accommodation process; to post a notice informing employees that federal law prohibits discrimination; and to report to the EEOC over a two-year period how it has responded to all requests for reasonable accommodations.

Feds Excuse Late Filing of H Visa Changes

Good news for employers desiring a change of status or extension of stay for a temporary worker admitted into the U.S under an H-1B, H-2A, or H-2B visa. If you were unable to file a timely request for an extension of stay or change of status because of the government shutdown, the government will consider that an “extraordinary circumstance” and excuse the late filing, as long as your petition meets all other requirements.

The H series of visas are temporary permissions to enter the U.S. to perform work. An H-1B visa is for temporary jobs in specialty occupaitons. The H-2A visa is for temporary agricultural workers, and the H 2-B visa is for temporary nonagricultural workers.

Since these are temporary visas, they run on a particular date and the sponsoring employer has to apply for an extension of stay or change of status.

Now employers can be comforted in knowing that the government shutdown won’t count against them if they were tardy in seeking those visa modifications.

Form I-129 is used to file for extension of stay or change of status.

Read the announcement by U.S. Customs and Immigration Enforcement.