Search the News Archive

FFCRA: DOL Publishes Temporary Rule and Further Guidance

"An employer is expected to count the relevant number of employees as of the date that an employee would take leave. Therefore, it may be that an employer would have to provide paid leave to one employee if the employer has fewer than 500 employees on the date that particular employee takes leave, but would not have to provide paid leave to a second employee if the employer has since exceeded the 500-employee threshold by the time that second employee would take leave"

The Impact of COVID-19 on Employer-Sponsored Benefit Programs

"Among the many ways that COVID-19 has affected Americans and U.S. businesses, employers are trying to figure out how to manage and administer their employee benefit programs in light of the pandemic. [These 15] questions and answers [are] in response to what companies have been asking about how the virus is affecting their benefit programs."

Supreme Court Declines to Shut Door on Public Company ESOP Stock-Drop Claims -- More Litigation to Follow

"Although the original Jander decision has been 'vacated,' the practical effect of the Supreme Court's failure to address the core issues leaves the door open to copycat ERISA stock-drop claims and renders the merit of the defenses asserted by IBM before the Supreme Court unresolved. The key takeaway for public companies that offer their own stock in their 401(k) plans is that the door has yet to be definitively shut on ERISA-based stock-drop claims, and that the future of Dudenhoeffer's effect on such claims remains to be determined." [Retirement Plans Committee of IBM v. Jander, No. 18-1165 (S. Ct. Jan. 14, 2020)]

Important Changes to Retirement Accounts Will Be Effective January 1, 2020

"The [SECURE] Act makes significant changes to IRA, 401k, and all other types of qualified retirement accounts. Some of the new rules will directly affect how individuals manage Retirement Accounts and, just as importantly, how certain beneficiaries inherit Retirement Accounts.... [T]he new rules ... call for an immediate review of beneficiary designations and estate plans to determine the actual impact of these significant changes."

IRS Letter 226J: What About the Constitutional Due Process Hurdles to Collecting Employer Shared Responsibility Excise Taxes?

"Years ago, the IRS created substitutes for MAGI to allow employers who chose to use the substitutes to determine whether they should reduce the cost of coverage to make it affordable for particular employees.... The substitutes may be substantially lower than actual MAGI. These are not really safe harbors in the context of assessing excise taxes, because they may subject employers to greater excise taxes than authorized by PPACA.... PPACA Section 1411 requires certifications to inform employers that employees have been conditionally approved for premium tax credits, and to give employers an appeal process. In most states, those notices were never sent, or were sent late. This was an important part of the procedural due process establish by PPACA, and the failure is not inconsequential."

HIPAA Phase 2 Audits Are Here. Are You Ready?

"Employer-sponsored plans providing health care benefits are generally Covered Entities, and this may include arrangements such as health care flexible spending accounts. Some employers with insured health care plans may be successful in taking a 'hands off' policy so as to avoid the need for the employer to take the many steps necessary to to satisfy the rules."

ERISA's Express Preemption Superpower Beats Iowa Pharmacy Benefits Manager Law

"The Court held that the law 'imposes mandates and restrictions on a PBM's relationship with Iowa and its pharmacies that run counter to ERISA's intent of making plan oversight and plan procedures uniform.' The Court found that the law specifically referenced self-funded plans regulated by ERISA -- carving them out due to ERISA preemption [and] observed that if the effect of a State law is to exclude some employee benefits plans from its coverage, that law has a prohibited reference to ERISA and is preempted." [Pharmaceutical Care Management Ass'n v. Gerhart, No. 15-3292 (8th Cir. Jan. 11, 2017)]

DB Pension Plans: Hungry Octopus Just Took a $4.5 Million Bite Out of Private Equity

"This decision ... raises significant concern about whether this rationale will be adopted by other jurisdictions, and how far fund multiemployer plan trustees and the courts will go to find prey to feed a multiemployer plan when a participating employer cannot satisfy its withdrawal liability. Further, given that the PBGC regulation also applies to single employer pension plans, this decision raises concern about how the PBGC might react to this decision, and how far the PBGC may go to seek prey for underfunded single employer pension plans it has taken over." [Sun Capital Partners III, LP, et al. v. New England Teamsters & Trucking Industry Pension Fund, No. 10-10921 (D. Mass. Mar. 28, 2016)]

The Next ACA Constitutional Hurdle: Employer Due Process vs. Taxpayer Privacy

"[T]he drafters [of the ACA] directed [HHS] to address this issue in a report to Congress by January 1, 2013, and to work with the Department of Treasury and other agencies to establish an advance notice and appeal process in compliance with employees' and employers' rights. HHS and the Department of Treasury have not cleared this hurdle, which may prevent the Department of Treasury from collecting employer shared responsibility excise taxes for failure to provide affordable coverage. Will HHS belatedly step up to resolve this issue, or will we be back in the U.S. Supreme Court?"

Supreme Court Restores ERISA Express Preemption's Superpower

"Here, the Court found that reporting, disclosure and recordkeeping are central to, and an essential part of the uniform system of plan administration contemplated by ERISA. The Court held that the Vermont law was preempted because it both intrudes on a central matter of plan administration, and interferes with nationally uniform plan administration. In taking this direct path rather than applying the twists and turns imposed by the Travelers line of cases, the Court restored ERISA express preemption's superpower." [Gobeille v. Liberty Mutual Ins. Co., No. 14-181 (U.S. Mar. 1, 2016)]