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What to Include or Exclude in ACA W-2 Reporting (PDF)
"For the 2012 tax year, employers who issued fewer than 250 W-2's for the 2011 tax year are excused from mandatory reporting, but may choose to test their payroll systems and report such amounts. For those who issued 250 or more W-2's in 2011, reporting is required. [This article includes a chart of data that] payroll vendors (whether providing payroll systems internally or externally) will need to capture from the employer that has historically not been part of a payroll system."
(Kushner & Company)
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Employees Often Overwhelmed by Health Plan Choices at Open Enrollment
"[A]ccording to a survey of 2,500 consumers conducted for insurance provider Aflac ... [e]ighty-nine percent default to the same options every year [and only] 16 percent contribute the right amount to flexible spending accounts.... [Another survey, by Aetna,] found that workers rank choosing health-care benefits as the second most difficult major life decision behind saving for retirement.... Overwhelmingly, employees said they found decisions on their health-care benefits to be difficult because the information they are given is confusing and complicated, there is conflicting data and it's hard to determine which plan is the right for them[.]"
(The Washington Post; free registration required)
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Depressed Employees Carry Higher Health Costs
"While relationships between employee health risks and subsequent total health costs have shifted somewhat over time, depression still accounts for employers' highest per capita medical spending, a recent study showed. Depressed employees -- making up roughly 11% of the work force -- spent on average $2,184, or about 48% more on healthcare than their nondepressed coworkers[.]"
(MedPage Today)
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Kodak Retirees Lose Health, Survivor Benefits
"Kodak currently spends about $10 million a month on such benefits.... In bankruptcy, 'Individuals may see their life savings lost or lose their jobs. Bankruptcy can have a particularly painful affect on retirees,' [the judge] said, before going on to say -- regardless of the financial pain to retirees -- that the benefits move is legal, fair and reasonable. The two largest wedges of the retiree-related debt are health coverage for 32,000 Medicare-eligible retirees, representing a $440 million liability on its balance sheet, and the [subsidized] Survivor Income Benefit for 7,500 people representing a $510 million liability."
(USA TODAY)
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Preparing for 2014's Employer Shared Responsibility Rules and Waiting Period Limitation (PDF)
"Beginning in 2014, applicable large employers (i.e., those with 50 or more full-time employees) will pay penalties if they fail to offer health coverage to 'full-time employees,' or offer coverage that is either unaffordable or does not provide minimum value.... If an employer fails to offer coverage to just one full-time employee, the employer will have to pay an annual penalty of $2,000, multiplied by total number of full-time employees reduced by 30.... In order to determine which employees are considered full-time employees, there are two safe harbors that allow an employer to have different measurement periods and stability periods depending on whether the employee is considered an ongoing employee or a newly hired, variable hour or seasonal employee."
(Drinker Biddle)
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'Wrap Plan' Was Part of ERISA Plan, Gave Discretionary Authority to AD&D Insurer to Interpret Provisions
"[T]he U.S. district court for the Southern District of Ohio held that the insurer/decisionmaker under an employer-sponsored accidental death and dismemberment policy had discretionary authority to deny benefits to two beneficiaries because: [1] A wrap plan incorporating the policy was part of the written instrument that established the plan under ERISA. [2] The wrap plan language was sufficient to give the insurer discretion to interpret the plan." [Johnson v. Prudential Insurance Co., No. 2:11-cv-664 (Oct. 31, 2012)]
(Practical Law Company)
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IRS Guidance Under ACA Addresses Full-Time, Part-Time and Seasonal Employees and the 90-Day Waiting Period
"Preliminarily, [IRS] Notice 2012-58 states that if a large employer reasonably expects an employee to work an average of 30 or more hours per week when hired, then the employer must treat the individual as a full-time employee, i.e., the employer must offer essential minimum coverage to the employee to be effective within 90 calendar days, or the employer may be subject to significant tax penalties. If, however, the employer reasonably expects the employee to work a variable schedule that may not average more than 30 hours per week, or the employee is employed only on a seasonal basis, then the employer can use the safe harbor rules set forth in Notice 2012-58 to determine whether to treat the individual as a full-time employee."
(Buchanan Ingersoll & Rooney PC)
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Benefits in General; Executive Compensation
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Year-End Amendment Deadline Under Section 409A Approaches for Severance Plans
"If severance benefits are treated as deferred compensation for Section 409A purposes, there are two alternatives for correcting defective provisions relating to severance benefits and releases: The arrangement can be amended to provide that payment will be made on a specified date, such as the 90th day after the employee terminates employment, or The arrangement can be amended to provide that if the period to sign the release spans two calendar years that the severance benefit will always be paid during the second calendar year."
(Miller Johnson)
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Corporate Directors' Pay Increases for Service on Compensation and Governance Committees
"[Mercer's] analysis of directors' compensation shows pay rose in 2011 for directors serving on compensation or governance committees at S&P 500 companies, yet pay remained stable for audit committee members.... Median baseline board compensation for directors at S&P 500 companies was $216,700 in 2011. Baseline board compensation included retainers and annual equity grants paid to each director for general board service, as well as fees for attending meetings of the entire board."
(Mercer)
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Press Releases
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