Quarterly HR Update – June 2022

Time to grab those flip flops…

The summer months are upon us. Who is ready for summer? We sure are! We hope everyone will have time this summer to relax, unwind, take a trip, watch the sunset, listen to the waves, walk barefoot in the sand, or simply enjoy some down time.

There never seems to be too much downtime on the employment front though, so HRT is continuing to work hard to keep you updated on important information that may impact your business. If you have questions or need support from HRT on any of the information included in this Update (or any HR topic), please reach out to us.

Inflation and Employee Pay

There is no denying it – inflation is way up. In fact, through May of this year, consumer prices have increased 8.6 percent which is the fastest rate of increase in the past forty years. Gas prices are at record highs and many employees are starting to feel the burden of this increasing “pressure” on their money.

As employers, it’s important to think about the current state of inflation and its impact on employee pay, especially given the phenomenon of the recent (and potentially ongoing) great resignation. How do employers need to respond to ensure pay remains competitive and employees are retained? Here are questions to think through:

• Are your employees expecting a higher increase in 2022 than prior years? The Society of Human Resource Management (SHRM) cited a recent survey by Grant Thornton LLP (an audit, tax and advisory firm) where 40% of the 5,000 respondents expect increases of greater than 6% this year (and 31% expecting more than 8%; 21% expecting more than 10%).
• Will you be giving higher pay increases in 2022 than prior years? If you’ve given 3% pretty consistently, are you able to increase that to 5% or 6%?
• If higher pay increases are not feasible, are there other options such as bonuses or other incentives to consider? This can be a reasonable option, so you’re not locked into higher wages once inflation falls or stabilizes.
• If you’re unable to give higher pay increases in 2022 and you think employees are expecting higher increases, are you prepared to address questions regarding increases and if/how inflation was factored in?

Moving away from specific increase amounts and pay philosophies, it’s also important to focus on the larger employee experience. Particularly if money is tight, how else can you maintain your attractiveness as an employer?

• Flexibility – the pandemic has shown how important flexibility is. Are you continuing to embrace this? Can you continue allowing employees autonomy and flexibility in their working hours, schedules, and location of work?
• Training and Career Growth – while we all work for money, many employees are yearning for knowledge, experience, and enrichment. How can you expand or enrich the training and educational opportunities for your staff?  Can you establish internal trainings, mentorship programs, and/or other opportunities for employees to share knowledge?
• Decrease Cost Sharing – this may not be the best time to pass along additional costs to employees. If you’re going through open enrollment in the next few months, are there opportunities to decrease cost sharing and limit the costs that are passed on to employees?

These are challenging times for both employers and employees when it comes to inflation, employee pay, and overall employee retention. HRT is happy to talk through this area with you.

Legal Updates & Info

Under Federal Law…

IRS Raises Standard Mileage Rate for July to December 2022: While we don’t typically report on mileage reimbursement rates, given the price of gas these days we wanted to share the news! For employers who follow the standard mileage reimbursement rate set by the IRS, it was recently announced the rate will increase from 58.5 cents per mile to 62.5 cents per mile for travel as of July 1, 2022. Every little bit helps…

Transparency in Coverage Law: A group of federal agencies have put together a rule outlining requirements for group health plans and health insurance agencies to disclose, via website and other avenues, cost-sharing information of their benefit plans, effective July 1, 2022. While this is not applicable to the work HRT Northwest does with clients, we encourage you to reach out to your broker if you want more information on this as the requirements do extend to employers who offer group health plans. All the details about this new requirement from the Federal Register can also be found here.

In Oregon…

Oregon Paid Family Medical Leave Insurance (PFMLI): It’s Oregon’s turn in 2023! As most Oregon employers are aware, back in 2019 Oregon adopted legislation (HB 2005 OR Rev. Stat. Ch. 657B) to provide Paid Family and Medical Leave Insurance (PFMLI) to Oregon employees. In short, PFMLI will provide 12 weeks of family and medical leave with partial wage replacement to eligible employees due to their own serious health condition, to care for a family member with a serious health condition, to bond with a new child, and to handle issues related to domestic violence, harassment, sexual assault or stalking.

Originally expected to be in place in 2021, in August 2021 the program was delayed, mostly due to funding needs for Oregon’s COVID-19 response. As of now, employers will be required to collect and pay contributions as of January 1, 2023. The contribution rate is currently set at 1%, with employees paying 60% and employers paying 40% of the contribution. Employers also have the option of paying the employee portion. To allow for time to fund the program, benefits are not expected to be paid out until no sooner than September 3, 2023.

Additional updates or delays may occur as PFMLI is implemented and HRT will be following closely. For current information about this law, you can refer to the PFMLI FAQ from Oregon’s Employment Department or reach out to HRT with questions.

In California…

Readopted COVID-19 Emergency Temporary Standard: Originally adopted in November 2020, California has readopted the ETS, for the third time, with some changes. The best place to look for all the specific details is the COVID-19 Prevention Emergency Temporary Standards Frequently Asked Questions. A quick rundown of the current ETS requirements include:

Testing:

• Testing must be made available to all employees, at no cost when a) an employee is experiencing COVID-19 symptoms, regardless of vaccination status or recent infection; b) an employee had close contact with a person with COVID-19 except for recently returned employee COVID-19 cases without symptoms; c) an “outbreak” occurs, which is defined as 3 or more onsite cases within a 14-day period; or d) a “major outbreak” occurs, which is defined as 20 or more onsite cases in a 30-day period.
• During an “outbreak”, specific requirements include weekly testing to employees in the exposed group after close contact. During a “major outbreak”, specific requirements include testing twice a week for all employees in the exposed group, regardless of close contact.
• Testing requirements apply to all employees with COVID-19 symptoms regardless of vaccination status. 
• Self-read and self-administered tests are now allowed as long as another independent means of verification of test results can be provided, such as a time-stamped photograph of the test results.

Updates Regarding Quarantine and Isolation: Depending on the circumstances, quarantine and/or isolation will likely apply in certain situations. For specific guidance, refer to the Guidance on Isolation and Quarantine for COVID-19.

Masks and Respirators: Unvaccinated employees are no longer required to wear face coverings, except in certain circumstances, such as when required by the CDPH, when required by the isolation/return to work protocols, and in “outbreak” and “major outbreak” situations. Employers must now offer respirators to all employees upon request.

Removal of Cleaning Requirements: The updated ETS removes the cleaning and disinfecting requirements.

In Washington…

Updates to Washington Paid Family Medical Leave (PFML):  Washington recently updated qualifying PFML leave reasons to include limited bereavement-related use in the tragic event of a child’s death. PFML may be used during the seven calendar days following the death of an employee’s child (if the employee would have qualified for PFML for birth or bonding reasons with the child).

Nondisclosure Agreements: Last month we published an article outlining details regarding certain provisions that are now restricted from being included in various employment-related agreements. Our article outlines the basics, along with our recommendation to have your legal counsel review any agreements you may have in use.

Pay Transparency: In May we published an article outlining requirements that will be in effect January 1, 2023, in regard to including salary and benefit information in job postings. Click here for a refresher.

HRT Northwest: Your Northwest HR Team

Seattle: (253) 642-7372 | info@hrtnorthwest.com

HRT Northwest is staffed by professionals in the field of Human Resources and business management. We are glad to help with your HR needs; however, we do not offer legal advice and our services are not a substitute for the help of a qualified attorney.