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Department of Labor's Model Notices on New COBRA Subsidy (PDF)

4 pages. Excerpt: On its web page, the Department of Labor provides three different notices applicable to Federal COBRA coverage. Commentators have noted inconsistencies between the general instructions, the headers on the notices and the provisions of ARRA which has resulted in some confusion as to whom each notice must be distributed. The Department of Labor has informally indicated to Bryan Cave that the notices are intended to be used as follows[.]

Think Your PTO Policy Complies With the Chicago or Cook County Paid Sick Leave Ordinances?

"Based on 'safe harbor' provisions in both Ordinances, many employers are assuming that their Paid Time Off (PTO) policies are sufficient -- as written -- to comply with these new PSL obligations. However, a careful reading of the Ordinances and their respective rules leads to the inescapable conclusion that almost no traditional PTO policy satisfies the Ordinances' burdensome and somewhat complex requirements."

Top 10 Updates to the California Family Rights Act Regulations

"[1] Employers must display new poster regarding [California Family Rights Act (CFRA)] rights ... [2] Extended health insurance continuation requirement ... [3] Employers now have only five business days to respond to CFRA leave requests ... [4] Substitution of vacation, PTO or paid sick leave during a CFRA leave ... [5] Time increments for intermittent leave ... [6] New light duty requirement when only intermittent leave is required ... [7] CFRA's protections expanded to broader group of employees ... [8] Successors in interest are 'covered employers' and additional guidance on joint employer situation ... [9] Reinstatement rights ... [10] New certification of health care provider form."

SEC Proposes Clawback Rules

"The SEC proposal acknowledges that one result of implementation of incentive-based recovery policies may be that executive officers demand incentive-based compensation be a smaller portion of their total compensation. As incentive-based compensation typically aligns the interests of executive officers and shareholders, less incentive-based compensation may move shareholder and executive interests in opposing directions."

Discretionary Clawback Policies: Risk of Variable Stock Plan Accounting

"Existing accounting guidance (ASC 718-10-30-24) would seem to suggest that clawback features should not disrupt fixed accounting treatment because of their contingent nature.... Companies adopting or modifying existing clawback policies should evaluate the potential risks of discretionary provisions ... before adopting or revising those policies. This will be particularly true for public companies when it comes time to evaluate compliance with the much-anticipated SEC guidance on clawbacks that will finally implement the Dodd-Frank legislation of 2010."

California Enacts Paid Sick Leave Law (PDF)

"The Act applies to all public and private employers, regardless of the number of employees. Employees are entitled to paid sick days if they work in California for 30 or more days within a year from commencing employment. Thus, the Act could apply to employees who reside in other states but spend substantial time working in California.... Employees accrue one hour of paid sick leave for every 30 hours they work.... An employee working 2,080 hours per year would earn more than eight days of sick leave per year at this accrual rate, but employers can place caps on sick leave use and accrual."

Recent FMLA Cases Address Rights of Employers to Enforce Medical Leave Policies (PDF)

"The key takeaway from [several recent] cases is that employees do not receive a 'free pass' to violate policies simply because they have requested, are on, or have taken FMLA leave. Rather, employers have a right to expect all employees to comply with established policies, even when the FMLA is implicated in some way with respect to the policy violation at issue. That said, employers should keep in mind [certain] principles when evaluating whether to take action against an FMLA-protected employee who has violated an employment policy[.]"

IRS Issues Guidance on Retiree Health Benefits Funded Through Captive Insurance Subsidiary (PDF)

"In order for an arrangement to qualify as insurance, the arrangement must, among other requirements, shift the risk of loss from the party paying the premium to the recipient of the premium, and the recipient must distribute that risk of loss among other insured parties. Prior to the issuance of Revenue Ruling 2014-15, there was uncertainty as to whether retiree health benefits funded through captive insurance subsidiaries had sufficient risk shifting and risk distribution to qualify as insurance."

Tips and Traps for Taking Current Year Deductions for Bonus Programs Fixed by End of Year (PDF)

"The employer must be committed to pay no less than the approved bonus pool amount, with no ability to reduce or change the aggregate amounts payable. Any further approvals or modifications to individual award amounts that result in a reduction of the approved bonus pool amount cause the entire bonus pool amount to be considered deductible in the year paid. The new insight from the IRS is their position that individual allocations from the approved bonus pool amount may be made after the close of the tax year without running afoul of the 'all events' tests, but any discretion or application of individual performance standards that results in a reduction of the approved bonus pool amount after the close of the tax year will cause the entire bonus pool amount to fail the 'all events' test for the prior tax year."

IRS Issues New Guidance on In-Plan Roth Rollovers (PDF)

"[For] sponsors of safe harbor 401(k) plans, the new guidance provides a temporary period (ending December 31, 2014) during which a mid-year change to provide for such rollovers is permitted.... For 403(b) plans, plan sponsors must still rely on the remedial period provided for in Rev. Proc. 2013-22 which allows such plans to make remedial amendments to correct form defects retroactive to January 1, 2010 (or the date the plan is established)."