Your 2018 Compliance Checklist

May 15, 2018

It wouldn’t be a new year without a new batch of local, state and nationwide legislation for employers to be aware of. Here’s our round-up of important updates and action to take. Reach out to Premier’s People Operations team if you need any additional support, clarification or guidance on how to comply in your organization.

Nationwide

IRS Extends Deadline to Distribute 1095-C Forms to Employees

The Gist: In late December 2017, the IRS extended the due date for distributing 1095-B or 1095-C ACA health coverage reporting forms to employees. Applicable large employers (ALEs) must distribute Forms 1095-B or Form 1095-C to employees by the new due date of March 2, 2018 (formerly January 31, 2018). 2017 filing due dates to the IRS will remain the same:

February 28th for paper filers
April 2, 2018 for electronic filers

This 1095-B and 1095-C extension might cause some confusion because employees may not receive their Form 1095-B or 1095-C by the time they are filing their 2017 taxes. Although the forms may be helpful, they are not required when filing. You can assure your employees that they can prepare their taxes using other information about their employer-offered health coverage, such as insurance cards, Explanation of Benefits statements, and W-2 or payroll statements.

Action: Make sure that all of your 2017 benefits-eligible employees have a copy of the 2017 1095-C form by the extended due date of March 2, 2018 and submit your returns to the IRS by the deadline of February 28, 2018 if filing a hard copy, or by April 2, 2108 if filing electronically.

State – California

New Parent Leave Act: California’s New Parent Leave Act – PDS

The Gist: Starting January 1st, 2018, employees of small businesses (20 or more employees) will have the right to job-protected leave to bond with their newborns. Employers are required to offer 12 weeks paid parental leave to bond with a new child within one year of the child’s birth, adoption or foster care placement. This new law benefits a huge population of employees with time to bond with their new children; not just those working at for large companies.

Who is eligible?

- Employees with 12 months or more of service with the same employer
- Employees with at least 1,250 hours of service with the same employer during the previous 12 months
- Employees who work at a worksite that has at least 20 employees within 75 miles

Action: Confirm if your company is eligible under this new law and update any policies as needed. This will affect smaller businesses and may present new challenges in terms of coverage and overtime while others are out on leave. Ensure your company is prepared for potential changes in the workforce to allow for a smooth transition when one or more employee goes out on leave (schedule adjustments, additional part-time hires, etc.).

More details on the new Parent Leave Act available here.

California Bans Salary Inquiries with the Passing of AB 168

The Gist: Effective January 1, 2018, California adds itself to the list of states and cities that prohibit employers from inquiring about a candidate’s past salary or using that information to determine whether or not to hire the applicant and what salary to offer an applicant. New York, Puerto Rico, Oregon, Delaware, Massachusetts, San Francisco, New York City and Philadelphia are already among the states and municipalities that have enacted similar legislation in an effort to ensure greater pay equity for women and minorities. The law does not restrict hiring personnel from discussing salary if the applicant “voluntarily and without prompting” shares their salary history with their prospective employer.

Action: Review your recruiting processes and interview questions to ensure that questions regarding former salary are completely omitted. Once you have your updated processes established, train anyone involved in the hiring process on the law and its intentions. Having a comprehensive compensation policy, guidelines and well- researched salary ranges for each position in your company is a best practice to ensure compliance and pay equity.

Multiple Cities in California Raising Minimum Wage

The Gist: Statewide, California is increasing its minimum wage to $10.50 per hour for employers with 25 or less employees and to $11.00 per hours for employers with 26 or more employees. These incremental increases highlight California’s effort to slowly reach the State’s goal of $15 per hour by the year 2023. And, in order to meet the ever-increasing cost of living in the Bay Area, several cities will be increasing their minimum wages well above the State’s minimum come January 1st:

Cupertino: from $12 per hour to $13.50 per hour
Milpitas: from $11 per hour to $12 per hour
Mountain View: from $13 per hour to $15 per hour
Oakland: from $12.86 per hour to $13.23 per hour
Palo Alto: from $12 per hour to $13.50 per hour
Los Altos: from $12 per hour to $13.50 per hour
San Jose: from $12 per hour to $13.50 per hour
San Mateo: from $12 per hour to $13.50 per hour (exception 501 (C) (3) nonprofits)
Santa Clara: from $11.10 per hour to $13 per hour
Sunnyvale: from $13 per hour to $15 per hour

Action: Make sure that your payroll or HR administrator increases hourly rates in your payroll system effective January 1, 2018 for any employees that are currently at the minimum wage pay rate. This may also require you to bump hourly rates that are hovering just above minimum wage to retain employees and stay competitive.

City – San Francisco

New Lactation Ordinance Goes Into Effect

The Gist: San Francisco leads the charge once again by introducing the very first lactation accommodation ordinance in the country. Effective January 1, 2018, employers located in the city are required to provide reasonable (unpaid) lactation breaks for nursing mothers as well as a policy to guide employees on how to make a request for lactation accommodation. Employers are required to meet minimum standards for providing a hygienic and comfortable space for lactation, including a place to sit, a surface to place a breast pump and supplies, access to electricity and access to a refrigerator and running water close to the employee’s work station. The ordinance also mandates that tenant improvements in certain types of buildings include lactation rooms. Penalties may be imposed starting January 1, 2019.

Action: If you employ any lactating mothers, ensure that your have a designated private lactating space set up in the workplace. You will also want to update your Employee Handbook to include guidelines for employees on how to request accommodation for lactation.

San Francisco Increases its SFHCSO Employer Healthcare Expenditure Amount

The Gist: As of January 1, 2018 the health care expenditure rate will be $2.83 per hour for large businesses (100 or more employees total) and $1.89 per hour for medium-sized businesses (20-99 employees total).

Action: Make sure that you are meeting the updated health care expenditure requirement through your employer contribution to medical, dental vision or other employer covered healthcare.

San Francisco Bans Salary History Inquiries

The Gist: San Francisco’s ” Consideration of Salary History Ordinance” goes into effect on July 1, 2018. Appicable to all employers in San Francisco, this new legislation prohibits employers from:

Inquiring about an applicant’s salary history
Considering an applicant’s salary history as a factor in determining what salary to offer an applicant
Refusing to hire, or otherwise disfavor, injure or retaliate against an applicant for not disclosing their current or previous salary history to the employer
Releasing the salary history of any current or former employee to the applicant’s employer or prospective employer without written authorization from the current or former employee

Nothing in this ordinance prohibits an applicant from voluntarily disclosing salary history following an employer’s initial salary offer in order to negotiate a different salary. It also does not prohibit an employer from considering that applicant’s salary history in determining a counter-offer.

San Francisco Rolls Out Paid Parental Leave for Employers with 20+ Employees

The Gist: Larger San Francisco employers already saw the rollout of the Paid Parental Leave Ordinance in 2017; However, the law is now kicking in effect January 1, 2108 for smaller businesses that employ 20 or more people. Come January 1st, any business in San Francisco with 20 employees or more must offer supplemental compensation to employees who are receiving California Paid Family Leave for purposes of bonding with a new child, including adopted and foster children.

Action: Update your Employee Handbook with a new Paid Parental Leave Policy, including instructions on how to request and ensure that the official notice is posted in a conspicuous place by January 1, 2018.

San Francisco Min Wage goes up to $15.00/hr on 7/1/18.