Employment Law

IRS Expands Self-Correction of Plan Qualification Errors

In 2018, the IRS modified its program for correction of plan qualification failures to significantly increase the fees for getting approval of corrections under the Voluntary Compliance Program (“VCP”). Since that occurred, the IRS has issued expanded permissible self-correction methods under Revenue Procedure 2019-19. This new Procedure provides many new ways in which a plan sponsor may act independently to fix errors to retain the plan’s tax qualification, without IRS filings, user fees, or other involvement. The new procedure permits plans to self-correct failures in two categories that previously required VCP filings: problems with participant loans and plan amendments. 1. In regards to loan failures, the new procedure permits self-correction of loan failures if the failure relates to • A default on loan payments (if..

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Significant Changes to Retirement Plans Proposed

As of April 2, 2019, there are two bills rapidly moving through Congress with bipartisan support. The Setting Every Community Up for Retirement Enhancement Act of 2019 (“SECURE”) passed the House and the Senate has proposed the Retirement Enhancement Security Act of 2019 (“RESA”). The bills are very similar and because there is bipartisan support it is likely that something will be passed soon. Some of the proposed changes are as follows: 1. Encourage employees to participate in automatic contributions in 401(k) plans and require employers to provide estimates of how much an employee’s account would provide employees if it were invested in an annuity. 2. Make it easier for small employers to join other employers in multiple-employer plans. 3. Easing nondiscrimination rules for frozen..

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FMLA Boot Camp

The Basics The Family Medical Leave Act, or FMLA, allows employees to take 12–26 months of unpaid leave for their own or a family member’s medical reasons. The FMLA generally applies to employers who have 50 or more employees. An employee covered by the FMLA must have been employed for at least a year and has worked at least 1,250 hours during preceding 12-month period. Intermittent FMLA and Reduced Leave Schedules Taking FMLA for a medical procedure or illness is one matter, it is another when that illness comes and goes unexpectedly. This is where intermittent FMLA and reduced leave schedules come into play. Intermittent FMLA allows employees to take FMLA in periodic blocks of time. For example, a pregnant mother may take days off..

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Defending Against ADA Lawsuits

Coauthored by Bradley A. Kletscher and Tyler W. Eubank Generally. The Americans with Disabilities Act (commonly known as the “ADA”) is a federal law meant to protect persons with disabilities from discrimination. To that end, the ADA requires that businesses open to the public remove architectural barriers where such removal is readily achievable. The Department of Justice has produced the ADA Accessibility Guidelines, voluminous guidance on design specifications covering everything from the height of counters to the placement of braille signage on elevators. The ADA also allows persons affected by discrimination in the form of architectural barriers to seek injunctive relief from courts compelling business owners to make changes to their establishments. ADA Abuse. Enter ADA “drive-by” lawsuits.

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Fair Share Agency Fees Struck Down by the United States Supreme Court

In a decision widely expected, the United States Supreme Court on June 27, 2018 struck down state laws that compelled public sector union employees to pay “fair share” or “agency” dues. In Janus v. AFSCME, the Supreme Court held that laws compelling these dues from unwilling members violated the First Amendment by requiring employees to, in effect, pay for speech with which they do not agree. The Supreme Court held that unions representing public employees have to fairly represent these employees regardless of whether they were dues paying members. The Supreme Court summarized its view as follows: Neither an agency fee nor any other payment to the union may be deducted from a nonmember’s wages, nor may any other attempt be made to collect such..

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