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Pay or Play? Facing the Challenge of 2014. Title Goes Here. Association of Corporate Counsel - Austin June 2013. Overview. Affordable Care Act – Status Employer Shared Responsibility Five Key Questions Consequences Considering the Options. PPACA – The Fight Continues….

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  1. Pay or Play? Facing the Challenge of 2014 Title Goes Here Association of Corporate Counsel - Austin June 2013

  2. Overview • Affordable Care Act – Status • Employer Shared Responsibility • Five Key Questions • Consequences • Considering the Options

  3. PPACA – The Fight Continues…

  4. Sharing is Mandatory

  5. The Five Questions • Question #1: Are you covered? • Question #2: Do you have a plan and if so, who’s in it? • Question #3: Is your plan affordable? • Question #4: Does your plan provide minimum value? • Question #5: Will any employees receive a subsidy for exchange coverage?

  6. Question #1 Are you covered? 50+ FTEs employer-wide? YES NO

  7. What ALEs You? • Are you an A.L.E.? • A controlled what? • Counting noses

  8. Question #2, Part 1 Do you have a plan? YES NO

  9. A Failure to Plan

  10. An Offer You Can’t Refuse?

  11. Measuring Up?

  12. No Coverage for You!

  13. Question #3 Does your plan offer minimum value? Pays at least 60% of costs for MEC? YES NO

  14. How Low Can You Go?

  15. Question #4 Is your plan affordable? Cost of self-only coverage under lowest cost plan > 9.5% of household income? YES NO

  16. Brother, Can You Spare 9.5%?

  17. Question #5 Will any employee be eligible for subsidized exchange coverage? YES NO

  18. Your Fate Hangs in the Balance

  19. The Final Equation No Coverage Unaffordable Coverage Skimpy Coverage “Good” Coverage $$$ $$ $* *Unfortunately, “good” coverage costs $$$

  20. The “Big” Penalty – 4980H(a)

  21. The “Lesser” Penalty – 4980H(b)

  22. So, Now What? Pay? Or Play?

  23. Points to Ponder

  24. Evasive Maneuvers

  25. Workforce Restructuring

  26. Recap & Strategies • Do the math – calculate potential penalties and know how they impact you • Data management – develop timely access to accurate personnel data • Worker classification – correctly identify common law employees • Enrollment - execute mistake-free open and special enrollment periods

  27. Questions?

  28. Comprehensive Immigration Reform: Proposed Legislation’s Impact on Employers Title Goes Here Presented By: Jacquelyn P. Maroney 6/20/13

  29. On April 17, 2013, the “Gang of 8” introduced S.744, the Border Security, Economic Opportunity, and Immigration Modernization Act of 2013 in the Senate. Key provisions of interest to employers: H-1B and L-1 visas New visa program for lower-skilled workers Employment verification Immigration Reform 2013 29

  30. Positive & Negative Impact on Employers + More H-1B Professional Work Visas Available - Lengthier & more expensive process to obtain H-1B Professional Work Visas - Additional rules and fees relating to “outsourcing” H-1B and L-1 workers to third-party sites + New Work Visa (“W”) Classification for Lower- Skilled Workers - Mandatory E-Verify - Increased civil and criminal liability for employing authorized individuals + Eliminating State-by-State Patchwork of State Immigration Laws 30

  31. H-1B Professional Work Visas(+) Increase in the Cap Current: Annual numerical limit is 65,000/year. Proposed: Increase cap to 115,000/year; May further increase cap to 180,000/year maximum depending on labor demands and unemployment rates. Possible quota increases of 5,000 to 20,000 within fiscal year, if cap is reached and unemployment rates for professionals is below 4.5%. Current: 20,000 additional H-1Bs available to those with U.S. advanced degrees Proposed: Amend this to 25,000 additional H-1Bs available only to those with U.S. advanced degree in STEM fields. 31

  32. H-1B Professional Work Visas(-) New Rules Requiring Test of Labor Market Recruitment—All H-1B employers would be required to post H-1B jobs on DOL website and engage in good faith recruitment (using industry-wide standards). Non-Displacement—All employers must attest that they have not displaced a U.S. worker with purpose of replacing worker with H-1B employee. DOL given expanded authority to review LCAs and audit H-1B employers. LCA process expanded (14 days). Most fines for LCA violations would be doubled. 32

  33. H-1B Professional Work Visas(-) New Rules/Fees on Outsourcing H-1B dependent employers prohibited from outsourcing H-1B employees. Dependent employers have 15% or more full-time, equivalent H-1B employees. Intending immigrants are not counted in calculation toward H-1B dependency if under “covered employer” (i.e., employer has filed I-140 petitions for 90% of L-1 and H-1B visa holders in 12 months preceding last six months). H-1B non-dependent employers required to pay a $500 fee for each outsourced H-1B worker. 33

  34. L-1 Intra-company Transfer Visas(-) New Rules on Outsourcing The Senate amended bill prohibits L-1B outplacement if 15% or more of the employer’s full-time equivalent workforce is made up of L-1Bs, including intending immigrants. Otherwise, L-1B outplacement prohibited unless: The worker is controlled and supervised by petitioning employer; The placement is not an arrangement to provide labor for hire; and The employer pays a fee. DHS granted expanded investigative powers. 34

  35. New “W Visa”(+) Program for Lower-Skilled Workers New nonimmigrant classification for foreign workers in low-skilled jobs. Beginning in 2015, the annual cap for W visas is 20,000 for the first year and increases to 75,000 by the fourth year. For each year after the fourth year, the annual cap will be calculated according to a statistical formula taking into account various factors. 35

  36. Employment Verification (+) All state and local laws and policies that relate to employment re-verification would be invalidated. (-) U.S. companies must implement the enhanced E-Verify employment verification system over a 5-year phase-in period to prevent unauthorized workers from obtaining employment in the U.S. Employers with more than 5,000 employees phased in within 2 years. Employers with more than 500 employees phased in within 3 years. All employers, including agricultural employers, phased in within 4 years. (-) Civil and criminal liability would increase substantially. 36

  37. Comprehensive Immigration Reform: Proposed Legislation’s Impact on Employers Title Goes Here Presented By: Jacquelyn P. Maroney 6/20/13 37

  38. June 20, 2013Employment Law UpdateChris Wike (Austin)

  39. Overview • Mission Consolidated Independent School District v. Garcia (Age Discrimination) • Texas West Oaks Hospital, LP v. Williams (Non-Subscriber Cases) • Miller v. Raytheon Co. (Emotional Distress Damages) • Symcyzk v. Genesis Healthcare Corp. (FLSA) • Arbitration Agreements and Jury Waivers

  40. Age Discrimination • Mission Consolidated I.S.D. v. Garcia

  41. Mission Consolidated I.S.D. • Plaintiff was a 48 year-old Mexican-American female • Replaced by a 53 year-old Mexican-American female • Brought claims under the Texas Labor Code for discrimination based on race, national origin, gender, and age

  42. Mission Consolidated I.S.D. • Lower court dismissed race, national origin, and gender, but maintained age claims under “otherwise showing” standard • Texas Supreme Court rejected McDonnell Douglas test and held that Texas law requires a plaintiff to show that they were replaced by someone younger

  43. Mission Consolidated I.S.D. • What this ruling does NOT apply to: • Group layoffs—must be a true replacement case • Direct evidence cases—only applies to cases where McDonnell Douglas test comes into play

  44. Non-Subscriber Workplace Injuries • Texas West Oaks Hospital, LP v. Williams

  45. Texas West Oaks Hospital • Defendant was a non-subscriber to WC insurance and Plaintiff-employee was injured on the job • Texas Supreme Court found that negligence claims arising out of on-the-job injuries are “health care liability claims” under the Texas Medical Liability Act

  46. Texas West Oaks Hospital • Practical implications: • Plaintiff must file an expert report within 120 days from date the petition was filed • Failure to comply leads to mandatory dismissal with prejudice • Defendant must be a health care provider and must be a non-subscriber to WC insurance

  47. Emotional Distress Damages • Miller v. Raytheon Co. (5th Cir.)

  48. Raytheon Co. • Age discrimination case brought under Texas Labor Code Chapter 21 and ADEA • Group layoff decisional group consisted of 34, 49, 53, 54, 55 • All were terminated except 34 year-old • Jury awarded $350K in back pay (X2) and $1M in emotional distress damages • Emotional distress lowered by court to $100K

  49. Raytheon Co. • 5th Circuit held that Plaintiff’s self-serving testimony was insufficient to maintain award of emotional distress damages without testimony of medical expert • Practical implications

  50. FLSA Collective Actions • Symczyk v. Genesis Healthcare Corp.

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