Author: Arthur A. Jones

Since its adoption in 2009, the Patient Protection and Affordable Care Act (ACA) has received a lot of attention. The ACA is one of the most complex pieces of legislation ever enacted by the federal government, and many of its required regulations are still being written.

Recently, the executive branch announced that it would delay implementation of the so-called “employer mandate”, the requirement that employers with more than 50 full-time employees either offer employer-subsidized health insurance or face penalties. Many employers thought they were “off the hook” for another year. That would be incorrect!

Section 1512 of ACA included a new section 18B of the Fair Labor Standards Act (FLSA). This is a new reporting requirement for every “covered employer” under the FLSA, which impacts most employers in the U.S. As this article is being written, there is just over one month left to comply.

Section 18B of the FLSA requires all employers to provide written notice to each of their employees, no later than October 1, 2013, of certain information related to health insurance benefits. The notice must be furnished to each employee hired after October 1, 2013. The notice is required whether or not the employer provides insurance to any of its employees. The stated purpose of the notice, according to the U.S. Department of Labor (DOL) is:

Informing the employee of the existence of the Marketplace (referred to in the statute as the Exchange) including a description of the services provided by the Marketplace, and the manner in which the employee may contact the Marketplace to request assistance;

If the employer plan’s share of the total allowed costs of benefits provided under the plan is less than 60 percent of such costs, that the employee may be eligible for a premium tax credit under section 36B of the Internal Revenue Code (the Code) if the employee purchases a qualified health plan through the Marketplace; and

If the employee purchases a qualified health plan through the Marketplace, the employee may lose the employer contribution (if any) to any health benefits plan offered by the employer and that all or a portion of such contribution may be excludable from income for Federal income tax purposes.

The notice also provides the mechanism for the IRS to determine whether or not an employer is subject to the penalties prescribed in the ACA.

The notice, which must be in writing, can be delivered by first class mail, in person, or electronically if certain requirements are met. The DOL has issued model language to satisfy this requirement, which is available on the DOL website. Employers are not required to use the model reporting language so long as they include all of the required information.

The DOL has also issued Technical Release No. 2013-02 which describes this reporting requirement in more detail.

Employers who offer insurance have probably received information from their insurance carriers or brokers to complete the notice. If you are an employer who does not offer health insurance, you still have time to comply. We are available to provide assistance to employers who need help satisfying this new requirement.

You can have it all. Anything your mind can conceive – money, health, love and happiness. Which of these do you desire most? This will be your biggest problem. Which of these dreams do you want to manifest first. Because you can have them all using the law of attraction in the proper way. That is the key – knowing how to use this universal law properly to achieve any or all of your desires.

The law of attraction will work in your life just as it has for me and countless others, but you can’t be greedy. Saying I want it all now is not a positive action, it is a negative self defeating action.

In order to realize the ultimate success using the law of attraction, take one goal at a time and concentrate fully on that one goal. By wanting too much, too soon, you are scattering your positive action and will accomplish little if anything.

Not being greedy also means that when you have achieved a goal, be grateful and don’t immediately ask for more. Take a break to enjoy what you have achieved.

Taking time before you move on to your next most important goal will do two things. First it will allow you to be grateful and enjoy the fruits of your labor and it will also allow you to clear your mind. By getting the goal that you have just achieved off your mind, you are now able to put your entire power of concentration upon your new goal. By taking your goals one at a time you will be much more successful and speed up the time that each is achieved.

In uncertain economic times managers must be able to schedule labor correctly in a consistent manner, keep employees happy, and reduce fines imposed by legislative authorities, such as the Department of Labor. Businesses should seek to use cost effective computer employee scheduling software programs to ensure that proper scheduling techniques are utilized. Effective scheduling software will be able to schedule meal and break periods, accurately calculate overtime costs, and archive previous schedules for managerial review.

Example: The general manager at an ice cream store needs to ensure that one manager is always on duty, as well as a number of representatives are available to scoop ice cream. Each employee is required to receive a number of breaks during their shift, and this particular business prefers to hire employees who are minors to fill “holes” in the schedule. During a normal work day, between three and four employees are working.

By not carefully scheduling the break and meal periods and minor rules, the manager may end up with a shortage of staff as multiple employees take breaks (or leave for the day) at the same time, and minor employees leave for home. During the labor shortage, customers will not be serviced appropriately. Alternatively, the manager may choose not to send employees home when they should or allow breaks to proceed – grounds for heavy fines, a lawsuit, and/or increased insurance premiums.

Labor & Industries (L&I) audits are common in some US states (California, Washington, Oregon, and New York are the most common) in restaurant, food-service, and other hospitality-related industries. These audits are performed by the state or by insurance companies to verify that the business has complied with all applicable regulations.

Audits focus on unpaid overtime, minors working too late or too early, break and meal periods that are not properly documented, and other violations. Rule infractions can be punished with stiff fines and/or insurance premium increases. Make sure that all employees are aware of the applicable rules for the city, county, and state / province. Follow federal / national rules (where applicable), corporate rules, and insurance regulations (if applicable).

Where possible, automated employee scheduling systems should be utilized to enforce these rules reducing the administrative burden placed on managers – allowing management to work on other pressing issues such as training, customer service, and management tasks which cannot be automated by cost-effective technology solutions.

In most lawsuits, even those involving employment-based claims, the existence of a corporation provides protection for owners, corporate officers, and employees from personal liability. One significant exception is when the suit is brought under the Fair Labor Standards Act. Owners, officers, and high-level managerial employees who exercise some control over employment matters often find, to their dismay, that they have been included as a defendant in an FLSA lawsuit along with the corporate employer.

The reason for this potential personal liability arises from the extremely broad definition of employer found in the FLSA: “‘Employer’ includes any person acting directly or indirectly in the interest of an employer in relation to an employee…”

While the majority of cases finding an individual to be an employer involve owners or corporate officers, not all of them do, and the author is unaware of any case holding that that an employer must be an owner. The terms are not synonymous. See, e.g., Patel v. Wargo, 803 F.2d 632, 638 (11th Cir.1986) (a company’s president, director and principal stockholder did not take a sufficiently active role to be an “employer” under the FLSA).

On the other hand, not every exempt executive employee is, a fortiori, an “employer” simply because he or she exercises some managerial authority. The term “employer” is not so expansive that Congress intended that all supervisors be personally liable for FLSA violations. “[C]ourts generally reject ‘the idea that a low-level supervisor within a company can be individually liable.'” (citations omitted) Hernandez v. City Wide Insulation of Madison, Inc., 2006 WL 1993552 *2 (E.D.Wis.). Simply put, not every exempt executive employee is automatically an “employer.”

The test of employer status generally used by courts is a more complicated one looking at the “economic realities” of the relationship and requiring a careful analysis of the facts in a particular case. See, e.g., E.E. Falk v. Brennan, 414 U.S. 190 (1973). Courts have sometimes applied a four-part test in determining whether someone is an “employer”: whether the alleged employer (1) has the power to hire and fire employees; (2) supervises and controls employee work schedules or conditions of employment; (3) determines employees’ compensation; and (4) maintains employee records. Chung v. The New Silver Palace Restaurant, 246 F.Supp.2d 220, 227 (S.D. N.Y. 2002). Nevertheless, the determination is based on all the circumstances and no single factor is dispositive. Id. See Brock v. Superior Care, Inc., 840 F.2d 1054, 1059 (2d Cir.1988); Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 139 (2d Cir.1999).

Control may be restricted, or exercised only occasionally, without removing the employment relationship from the protections of the FLSA, since such limitations on control “do[] not diminish the significance of its existence.” Donovan v. Janitorial Servs., Inc., 672 F.2d 528, 531 (5th Cir. 1982). However, courts generally require proof, in order to find personal liability for an FLSA violation, that the individual in question is “responsible in whole or part for the alleged violation.” See, e.g., Riordan v. Kempiners, 831 F.2d 690, 694 (7th Cir.1987).