February, 2010     

 
 

  Hello! 

MJMS has lots of news this month to share with you.  We've made a list so you won't miss anything. We're also wondering when was the last time you read your own company handbook?  It's a wise thing to do, as our feature article points out. Don't miss it! 

Administration Proposes Further Extending COBRA Subsidy

Out Of State Marriages 

Here's a Novel Idea:  Read Your Own Company Handbook

Our Monthly Quiz

Administration Proposes
Further Extending COBRA Subsidy 

The following was written by Stephen Miller, 2/9/2010 
 
An additional 10-month COBRA premium subsidy extension was proposed by President Barack Obama in his budget for fiscal year 2011. If enacted into law, beginning (or retroactive to) March 1, 2010, the federal government would continue to reimburse employers or health plans to subsidize 65 percent of the premium for workers who lose their jobs. Under the proposed extension, the subsidy would be available to workers laid off between March 1 and year end 2010. The subsidy would be provided for a period of up to 12 months.

The COBRA subsidy program was originally passed by Congress in February 2009. Under a program extension enacted in December 2009, workers who lose their jobs from Sept. 1, 2008 through Feb. 28, 2010 receive the subsidy for up to 15 months.

As under the current program, only laid-off workers who could not get coverage under another group health plan, like a spouse’s plan or Medicare, would be eligible for the subsidy. The premium assistance would be available for individuals whose income is under $145,000 and for families filing jointly with incomes under $290,000. The subsidy phases out for those earning more than $125,000 (or $250,000 for families). 

"Part of the confusion for benefit administrators and employees is that, as originally passed, the subsidy was provided for a period up to nine months. In December 2009, the period was extended to a total of 15 months, and under the latest proposal it would be 12 months," says Karen Frost, health and productivity solutions leaders at Hewitt Associates in Chicago. "That's three different time frames and three different provisions."

As a result, she explains, "workers who become unemployed on Feb 28 are entitled to the subsidy for 15 months. But if they are laid off on March 1st, they only receive the subsidy for 12 months."

Get Prepared Now

If the extension is passed, and Frost believes it's "very likely" it will be—given its support by the President and in Congress—"HR and benefits administrators will have to go through another effort to get people knowledgeable on the extension," and the DOL will have to issue new notices.

"The quicker we can get action from the administration and the Congress, the better it will be for employers and administrators, and for the individuals who are affected," she notes. Otherwise, some subsidy payments will have to be made retroactively, as was done with the original COBRA premium subsidy and the first extension.

"The best insight I can give to HR is to start talking now to your COBRA administrator about how to handle this potential extension," Frost advises. "If the extension hasn't been passed by March 1, some employers may want to proceed assuming that the extension is going to happen. They'll have the least amount to deal with retroactivity because they'll be ahead of the game, but they do take a bit of a risk that the subsidy doesn't get extended. The other option is to make sure that your COBRA administrator is planning for the extension and can hit the ground running as soon as it is enacted."

Adjusting to the original subsidy was the hardest part, says Frost. "For the first extension, we just had to modify what we were already doing in terms of the subsidy. And the efforts around a second extension would be very similar. It's a modification; it's not a brand new game."

Stephen Miller is an online editor/manager for SHRM.

Out Of State Marriages 

If you have employees who may have experienced a marriage to a partner of the same sex which is valid in another state, please be aware that the marriage will probably be recognized in CA – this may impact how you offer benefits to your employees.

California recognizes out-of state marriages as legal in California if they are legal in the state where marriage occurred. Senate Bill 54 provides that a marriage between two persons of the same sex contracted outside California that would be valid by the laws of the jurisdiction in which the marriage was contracted is valid in California if the marriage was contracted prior to Nov. 5, 2008. 

And our quiz .... 

 Under the Fair Labor Standards Act, there is a computer-employee exemption from overtime-pay requirements. How much must an employer pay an employee on an hourly basis for the employee to qualify for the computer-employee exemption? CA employers, be careful on this one – see note following explanation.

A) At least $11.38 per hour

B) At least $7.25 per hour

C) At least $25.12 per hour

D) At least $27.63 per hour

Answers are found at the end of our main article.

Here's a Novel Idea: 
Read Your Own Company Handbook

 
Read any good books lately? Maybe the next one you ought to pick up is your organization’s own policy and procedures handbook. If I were to quiz you about it right now, could you score 100%? If not, as one court recently warned, a judge may just ... throw the book at you!

Case in Point: Eugene Collins, a 52-year-old African-American, was promoted to a facilities manager position at a Connecticut government office. At the time of his promotion, Collins’ new boss promised him he’d be trained on the job. But he wasn’t trained, and early into his new position, Collins was demoted for poor performance.

Collins argued that he was never trained as promised in the employer's standard company procedures. He also wasn’t given an opportunity to improve his performance or even given a performance review, as was also required by company policy.

Collins filed an internal complaint about being treated unfairly. He pointed to younger, white male co-workers under age 40 who were in his position and had received training and opportunities to improve their performance. Soon after filing his complaint, Collins said he started to receive poor performance evaluations, which came at him fast and furiously. He was then fired within two months of his complaint.

Collins sued for race discrimination, age discrimination and retaliation, claiming the company deviated from its written policies and procedures. The company denied the charges and asserted that Collins had poor leadership skills and just couldn’t do the job.

What happened next … and what lessons can be learned?

The court tossed out the employer’s summary judgment bid and gave Collins the green light to have his case heard by a jury. The main reason: Supervisors had “deviated substantially from normal procedures” by failing to give Collins a timely first performance evaluation and on-the-job training.

The court added that, “a reasonable jury could conclude that these departures from regular procedures impacted the decision to demote Collins.” (Collins v. Connecticut Job Corps, D. Conn., 7-991, 2/8/10)

3 Lessons Learned … Without Going to Court
This all seems so basic, right? Follow your company’s policies and procedures. But, do you really know what they say?

  1. Read the rules. When was the last time you sat down with a glass of milk and a whole cheesecake and really read the rules your company wrote? Do it now.
     

  2. Use a yellow highlighter. Won’t you be shocked to find out what the rules really say? And, what they don’t?
     

  3. Follow the rules. As the court admonished, “don’t deviate” from your own rules. You made them. You must play by them. If you do want to make a change, alert the staff first.

Source:  Copyright 2010 National Institute of Business Management, a division of Capitol Information Group, Inc. All rights reserved.

How many business owners find themselves in similar situations? How many employers have not reviewed their handbook since the day they “borrowed” it from another business or put one together from bits and pieces gathered from the Internet?

Handbooks can be very useful and helpful in managing employees, but can be a nightmare if it is not up to date and especially if it is not followed consistently, as the article points out. MJMS can help you avoid situations like this one. We can review and update your handbook or develop an entirely new handbook that fits your company’s culture and way of doing business AND is compliant with your state’s labor laws as well as federal regulations. Just give us a call or send us an e-mail and we will do the rest.
 

Answers to the  quiz:
D is Correct: At least $27.63 per hour 

Explanation: 
Explanation: Computer systems analysts, programmers, software engineers, and workers in similar computer-related jobs are exempt if they are paid on an hourly basis at a rate of at least $27.63 per hour or $455 per week and their primary duty consists of:

  1. The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or system functional specifications; or
     

  2.  The design, development, documentation, analysis, creation, testing, or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications; or
     

  3. The design, documentation, creation, testing, or modification of computer programs related to machine operating systems; or
     

  4. A combination of duties described in 1, 2, and 3, the performance of which requires the same level of skill.

Source: HR.BLR.com

NOTE to CA employers: California’s Industrial Welfare Commission (IWC) Wage Orders provide that computer professionals as described above, must earn a minimum of $37.94 effective January 1, 2009. 

For more detail go to: http://www.dir.ca.gov/iwc/computerSoftwareEmployees.html
  

Don't Forget To Access Our WebForms.
Answer All Your Human Resource Needs!

  • Manage Your Day-to-Day Non-Profit or Small Business

  • Organize All Necessary Human Resource Information

  • Promote Legal Compliance Within Your Organization.

Click Here To Know More!

 
ABOUT MJMS, INC.

President and Principal Consultant: Margaret Jacoby, SPHR

Margaret Jacoby has more than 25 years of Human Resources and professional management experience in a variety of industries. She has designed human resources infrastructure and implemented systems to ensure compliance with state and federal employment laws. She has directed high quality human resources functions for small and emerging businesses, and served as an external consultant to a wide range of diverse organizations, including non-profits.

Her work has included:

  • Conducting H.R. Needs Assessments

  • Drafting employee handbooks and policy manuals

  • Conducting job analysis and developing position descriptions

  • Conducting on-site compliance audits

  • Counseling management on progressive discipline

  • Drafting and review of employee disciplinary actions

  • Providing mediation in employee/employee conflict

  • Training employees/supervisors/managers in the implementation of human resources systems and policies such as Sexual Harassment

  • Conducting workshops for business owners on H.R. compliance issues.

Ms. Jacoby has earned the nationally-recognized certification of Senior Professional in Human Resources (SPHR) from the HR Certification Institute, Society for Human Resource Management (SHRM).

Ms. Jacoby’s professional affiliations include:

  • Professionals in Human Resources Association (PIHRA)

  • Society for Human Resource Management (SHRM)

  • National Association of Women Business Owners (NAWBO), Los Angeles and Phoenix

  • California Chamber of Commerce

  • Arizona Small Business Association (ASBA)

  • Long Beach Community Business Network (LBCBN)

  • Institute for Management Consultants (IMC)

The information contained in this newsletter is provided as general information and is not a substitute for legal or professional advice. The information is provided by MJ Management Solutions, Inc. and while we endeavor to keep the information up-to-date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the newsletter or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.
  

Phone: 480-924-6101 and 310-798-4569     Fax: 408-452-1429 
margaret@mjms.net • MJ Management Solutions, Inc.