Quarterly HR Update – September 2023

New Laws are Falling Like Leaves!

With Fall fast approaching, the weather is slowly changing, the days are getting a bit shorter, and we are keeping very busy staying up to date on recent and upcoming legal changes. Grab a cup of coffee or tea, maybe even grab a blanket and really settle in – there is a lot to cover! And please reach out with any questions.

Please note this is a summary of upcoming changes and not an all-inclusive overview.

Legal Updates & Info

Under Federal Law…

EEO-1 Reporting: It’s like a Halloween treat from the government…the 2022 EEO-1 reporting period is set to open on October 31, 2023! The deadline for filing the reports is December 5, 2023.

As a reminder, employers with 100 or more employees (or federal contractors with at least 50 employees) must submit an EEO-1 report to the Equal Employment Opportunity Commission (EEOC) each year. Employers can provide data (which includes race/ethnicity and gender demographics of their workforce) from any payroll period between October 1, 2022 and December 31, 2022. The updated Instruction Booklet is available now; information and updates regarding the 2022 EEO-1 Component Data File Upload Specifications are posted here.

Medicare Part D Notification Requirements: The Centers for Medicare & Medicaid Services (CMS) require group health plan sponsors to provide the Medicare Part D Creditable Coverage Disclosure to Medicare-eligible individuals before October 15th of each year. We find that most plans are creditable (which means your prescription drug plan offers the same or better benefits than the Medicare Part D plan) and often times brokers will include a Medicare Part D Notice in open enrollment packets. In terms of next steps to meet this notification requirement:

Determine if your group prescription drug plan is creditable. (If you are unsure, check with your broker)
If not provided by your broker, customize the appropriate model notice here. (Very few fields need to be customized!)
Send the Disclosure to all plan participants. (While the requirement is to send the Disclosure to Medicare-eligible individuals, because it is difficult to know who is Medicare-eligible, we recommend sending the Disclosure to all plan participants)

Pregnant Workers Fairness Act (PWFA): As a reminder, this law took effect on June 27, 2023, with proposed rules which are open to public comment through October 10, 2023. With the PWFA expected to be expansive, we are outlining a few details from the proposed rules:

“Pregnancy, childbirth, or related medical conditions” could cover current pregnancy, past pregnancy, potential pregnancy, lactation, use of birth control, menstruation, infertility and fertility treatments, endometriosis, miscarriage, stillbirth, or having or choosing not to have an abortion, among other conditions.
Many employers are accustomed to the Americans with Disabilities Act (ADA) when addressing accommodation type situations. The PWFA is not expected to align with the ADA in the following ways: 1) The PWFA will likely cover situations that do not meet the ADA definition of disability – i.e. more situations will be covered by PWFA than the ADA; and 2) A “qualified” employee or applicant is likely extended to include someone who cannot perform an essential function for a temporary period if, in the near future the employee is expected to perform the essential function, and if a reasonable accommodation can be made for the situation.

We will report back on the rules, once they are finalized, along with guidance for policy or practices changes moving forward.

Stericycle ruling from the NLRB: Last month, in what is being referred to as the Stericycle decision, the National Labor Relations Board (NLRB) adopted “a new legal standard for evaluating employer work rules…”, as explained in the NLRB’s news release. The NLRB decision applies to unionized and non-unionized environments so all employers are encouraged to review their policies, particularly those in their Employee Handbooks, to identify policies that may need to be edited.

Here’s why: Under the NLRA, employees must be allowed to discuss terms and conditions of employment, such as wages, benefits, and working conditions. Under this new standard, policies or rules that have a “reasonable tendency to chill employees from exercising their rights” should be carefully reviewed. The tricky part is, even policies that may seem more than reasonable (such as personal conduct policies or policies prohibiting insubordination) are likely problematic. For example, policies requiring employees to act respectfully toward colleagues/management and avoid behaviors that could harm or intend to harm the Company’s business reputation, are likely too broad under the new standard. The law firm Fisher Phillips has a good article with guidance here. And of course, please reach out to HRT if you need HR assistance or support updating your Handbook.

Form I-9 Reminders: In our June Update and August email & web posting, we shared information regarding Form I-9 compliance. Here is a quick recap:

Unless you are an E-Verify employer, all inspections of I-9 documents must now be done in-person. Remote verifications are no longer allowed as of July 31, 2023.
A new Form I-9 (version 8/1/2023) is available for use. Employers must begin using the August 2023 version no later than November 1, 2023. Links to the new form (both Spanish and English versions, and instruction pages) can be found here.

OSHA Electronic Recordkeeping Rule: Effective January 1, 2024, more employers will be required to submit electronic information to the Occupational Safety and Health Administration (OSHA). Under the new rule, published July 21, 2023, establishments with 100 or more employees (listed in Appendix B to Subpart E of Part 1904 of the Rule) must electronically submit their OSHA 300 Log, OSHA 301 Incident Reports, and OSHA 300A Summary Data. Workplaces with 20-249 employees (listed in Appendix A to Subpart E of Part 1904 of the Rule) must electronically submit their OSHA 300A Summary Data.

As a reminder, while OSHA logs are required to be posted internally at an employer from February 1 through April 30 of each year, the deadline that covered employers are required to electronically submit certain information to OSHA is March 2nd of the year after the calendar year covered by the form. For example, information regarding 2023 recordable workplace injuries and illnesses would need to be submitted by March 2, 2024.

Proposed Exempt Salary Threshold Changes: The Department of Labor is looking at increasing the exempt salary threshold, at the federal level, from $35,568 per year (for white-collar exemptions to overtime requirements) to $55,068 per year. While this potential increase is still below the current threshold in both Washington and California, employers in other states, or Washington employers with remote out of state employees who do not qualify as Washington-based, should take note. We will report back once/if the increase is finalized.

Under Washington Law…

Exempt Salary Threshold Changes: Speaking of exempt salary thresholds, Washington is set to increase the minimum salary threshold again for exempt employees as of January 1, 2024. Washington established an implementation schedule for annual changes a few years ago and will likely announce the approved threshold for 2024 in the coming weeks. As listed on the schedule, the projected threshold for both small and large employers is $69,264, which is a considerable jump for small employers whose current threshold is $57,293.60. (Large employers for 2023 are at $65,478.40).

Fun fact/reminder: while we reasonably plan for the projected amount, the actual amount can differ. The projected 2023 threshold for large employers was $61,828, with the final approved threshold being $65,478.40 for 2023. We will send an update once the 2024 threshold figure is finalized and announced.

Washington Long Term Care Fund: Employee payroll deductions for the Washington Long Term Care Fund (i.e., WA Cares) started back on July 1, 2023. Now that some funds have been collected, it’s time for employers to start reporting information back to the state. As a reminder, Quarterly Reporting (done by the employer) for these deductions begins October 1, 2023. For more information on what is required, the WA Cares website directs you to this Paid Family & Medical Leave (PFML) website, which looks to have WA Cares reporting fully integrated for the employer’s convenience. (Yay!)

Under California Law…

Minimum Wage & Exempt Salary Threshold Changes: California is planning some wage-related changes for 2024. If you are a California employer or have California employees, here is what you need to know:

Effective January 1, 2024, the minimum wage for all California employers is $16 per hour.
Keep an eye on local changes too – cities or counties may have minimum wage changes as well. California’s Department of Industrial Relations reports a handy tool (made available from and maintained by UC Berkley) to track these changes: list of City and County minimum wages in California.
The exempt salary threshold (for white-collar exemptions to overtime requirements) will increase to $66,560 on January 1, 2024.

California Privacy Rights Act (CPRA): As previously reported, the CPRA was effective January 1, 2023. The final rules, which were delayed for quite some time, are now finalized (as of March 29, 2023). Navigating the law is tricky due to its complexities, so employers are encouraged to seek an attorney’s guidance.

Criminal Records & Hiring Decisions: Effective October 1, 2023, California employers may need to adjust their practices related to hiring decisions and a job applicant’s criminal history. This is due to the recent approval (by the Office of Administrative Law) to approve proposed modifications by the California Civil Rights Council regarding the Fair Employment and Housing Act’s regulations concerning how criminal history can be factored into hiring decisions. In very high-level terms, this means:

The term “applicant” now includes existing employees applying to other jobs or those subject to a criminal history review due to ownership, management or policy change.
Inquiring, considering, distributing or disseminating information related to criminal history is not allowed until after making a conditional offer. Employers are not allowed to include statements in job postings or on applications about requiring a clean criminal record or stating those with criminal history will not be considered for hire.
Considering voluntarily disclosed information by an applicant about their criminal history is only allowed after making a conditional offer. Specific types of criminal history, including arrests, should never be considered.
Currently, when rescinding a conditional employment offer due to criminal convictions, an “individualized assessment” must be conducted to justify the decision. The assessment requires employers to assess the nature and gravity of the offense, the duration of time that has passed and the nature of the job. The new regulations expand on the assessment of the “nature and gravity of offense” to include several factors, including but not limited to whether people or property were harmed, the degree and permanence of harm, the context in which the offense occurred, whether a disability contributed to the offense, whether trauma or violence contributed to the offense or conduct, and/or the age of the applicant when the conduct occurred.
If the employer makes a preliminary withdrawal of the job offer following the individual assessment, it must be done so in writing. The new regulations also provide the applicant the right to voluntarily respond to the preliminary withdrawal, to provide information challenging what the employer is citing and/or to provide information of rehabilitation or mitigating circumstances before the decision to rescind the offer is final.
If the applicant provides a response, the employer must consider all information before making a final decision on withdrawing the offer.

The updated regulations provide more detail. If you conduct criminal background checks as part of your hiring practices, we strongly recommend reviewing your practices and talking with your background check vendor to help ensure compliance with these updated regulations.

Under Oregon Law…

Oregon PFMLI and OFLA: We seem to live in a world of acronyms these days so here’s a quick reminder: PFMLI is Oregon’s Paid Family Medical Leave Insurance program, being referred to as Paid Leave Oregon on their official website. More details can be found in articles we wrote back in June and August 2022; the pertinent information for this Update is employees are now allowed to apply for PFMLI benefits through the state’s application website(as of September 3, 2023). OFLA is Oregon’s Family Leave Act. OFLA applies to employers with 25 or more employees and has been around for years, providing unpaid time off to eligible employees in qualifying circumstances.

PFML (or an employer’s approved equivalent plan if that applies) doesn’t replace OFLA, which means employers must navigate both laws/requirements when evaluating an employee’s leave situation. (Reminder, we know how tricky leaves can be – HRT is always here to help!) We’re also happy to report that Oregon’s Governor Kotek recently signed Senate Bill 999 which amends and better aligns both PFMLI and OFLA. Those changes are as follows:

Concurrent Leave: If an employee applies for PFMLI for an OFLA-covered reason, the leaves run concurrently, and should be tracked as OFLA leave. However, the employee can decide to take unpaid OFLA leave before applying for and taking PFMLI, in which case the leaves would not run concurrently, at least initially.
Maximum Leave: The law states the maximum leave that can be taken under these laws (OFLA and PFMLI) is a combined total of 16 weeks per benefit year (or 18 weeks if due to qualifying pregnancy reasons).
Defining the Benefit Year: PFMLI defines the benefit year as “a rolling forward year, for the 52-week period beginning on the Sunday before PFMLI leave begins”. The OFLA benefit year must now align with the PFMLI definition. Because many employers define the OFLA benefit year in different ways (e.g., calendar year or rolling backward year), employers are allowed some time (until July 1, 2024) to transition to the new definition. A 60-day notice of the change must also be given to employees. (While not included in the law, we recommend evaluating your FMLA benefit period at the same time.)
Family Member Definition: In efforts to align the laws, the definition of family has been expanded under OFLA. Covered family members for these laws now include: spouse, domestic partner (DP), child, child’s spouse/DP, parent, parent’s spouse/DP, sibling, sibling’s spouse/DP, stepsibling, stepsibling’s spouse/DP, grandparent, grandparent’s spouse/DP, grandchild, grandchild’s spouse/DP, and as explained by the OFLA website “any individual by blood or affinity whose close association with a covered individual is the equivalent of a family relationship”.
Reinstatement: In a situation where an employee’s job no longer exists upon return from leave, the employee must be offered an equivalent position within 50 miles of the original position.
Benefits Continuation: PFMLI benefit continuation now matches OFLA. In short, health benefits must be maintained while on PFMLI or OFLA.

HRT Northwest: Your HRT Northwest Team

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

This Update is not a full overview of all recent or upcoming legal changes. 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.