BAN Blog

Dress Codes: Designing, Implementing, and Enforcing.

Posted on by Bobbi Kloss, BAN Director of Human Capital Management

There was a time, and still suggested today, when it was advised to dress for the position you wanted, not the one you were in. Dress codes were and still are about empowerment―but the question is, whose empowerment?

Traditionally, dress code policies were designed to set white collar apart from the blue-collar worker, the executive from the administrative staff. They were individualized to the industry one was in or to distinguish the workers from the industry being served (retail, hospitality). Policies focused
their objective on a definition of professionalism that related the clothes to the business attitude of trustworthiness and reliability.

Today, it is still about empowerment. Aligning with the DNA of the generation(s) that employers are focusing on attracting and retaining, dress codes established today focus on setting that individual company culture. Take for example the “dress appropriately” dress code policy at General
Motors. Such dress code policies allow for the actions of the company, its product, and the service-minded ethics of the workforce to exemplify reliability and the attire of the personnel then become about relatability. What becomes created is a culture where supervisors and employees are empowered to think for themselves in determining what is appropriate to wear to work and for them to come together to provide viable solutions when challenges present themselves.

The relaxation of today’s dress codes also allows for more personal expression advancing the forms that diversity in the workforce can take. Whereas men’s haircuts may be longer, non-existent, bolder colors in women’s hair, tattoos, large, bulky jewelry, transgender employees, religious customs, and generational norms, are just a few of the consideration’s employers are looking at within the make-up of the workforce. For many companies, the line being drawn is focused on what
is not distracting or disruptive to the workplace and what falls within non-discrimination guidelines.

In some industries, i.e. tech and marketing companies, the CEO now may be hard to tell apart from the staff. With today’s entrepreneurial-minded generations moving quicker up the corporate ladder, they are the dress code trendsetters versus what may be considered the “suppressed” (ties, dresses, pantyhose, etc.) dress code of the prior generations.

There even seems to be less “casual Fridays,” as every day is business casual or casual. In addition, having the ability to work remotely from home also promotes an unmonitored dress code. Remember the bunny slippers commercial?

In designing or updating dress code policies for today, and as in any policy development, Human Resources needs to define the objective of the dress code. What is the message the company wants to convey to its employees and the customers it represents? Some dress codes are meant to send a
message about the company’s image or style―think about a trendsetting salon or restaurants… [Read the full article]

Written by Bobbi Kloss, Benefit Advisors Network Director of Human Capital Management Services, published in Entertainment Human Resources Network.

Legal Alert: CMS Extends Transition Relief for Non-Compliant Plans through 2020

Posted on by Stacy Barrow

On March 25, 2019, the Centers for Medicare & Medicaid Services (CMS) announced a one-year extension to the transition policy (originally announced November 14, 2013 and extended five times since) for individual and small group health plans that allows issuers to continue policies that do not meet ACA standards. The transition policy has been extended to policy years beginning on or before October 1, 2020, provided that all policies end by December 31, 2020. This means individuals and small businesses may be able to keep their non-ACA compliant coverage through the end of 2020, depending on the policy year. Carriers may have the option to implement policy years that are shorter than 12 months or allow early renewals with a January 1, 2020 start date in order to take full advantage of the extension.

Background
The Affordable Care Act (ACA) includes key reforms that create new coverage standards for health insurance policies. For example, the ACA imposes modified community rating standards and requires individual and small group policies to cover a comprehensive set of benefits.
Millions of Americans received notices in late 2013 informing them that their health insurance plans were being canceled because they did not comply with the ACA’s reforms. Responding to pressure from consumers and Congress, on Nov. 14, 2013, President Obama announced a transition relief policy for 2014 for non-grandfathered coverage in the small group and individual health insurance markets. If permitted by their states, the transition policy gives health insurance issuers the option of renewing current policies for current enrollees without adopting all of the ACA’s market reforms.

Transition Relief Policy
Under the original transitional policy, health insurance coverage in the individual or small group market that was renewed for a policy year starting between Jan. 1, 2014, and Oct. 1, 2014 (and associated group health plans of small businesses), will not be out of compliance with specified ACA reforms. These plans are referred to as “grandmothered” plans.
To qualify for the transition relief, issuers must send a notice to all individuals and small businesses that received a cancellation or termination notice with respect to the coverage (or to all individuals and small businesses that would otherwise receive a cancellation or termination notice with respect to the coverage).
The transition relief only applies with respect to individuals and small businesses with coverage that was in effect since 2014. It does not apply with respect to individuals and small businesses that obtain new coverage after 2014. All new plans must comply with the full set of ACA reforms.

One-year Extension
According to CMS, the extension will ensure that consumers have multiple health insurance coverage options and states continue to have flexibility in their markets. Also, like the original transition relief, issuers that renew coverage under the extended transition relief must, for each policy year, provide a notice to affected individuals and small businesses.
Under the transition relief extension, at the option of the states, issuers that have issued policies under the transitional relief in 2014 may renew these policies at any time through October 1, 2020 and affected individuals and small businesses may choose to re-enroll in the coverage through October 1, 2020. Policies that are renewed under the extended transition relief are not considered to be out of compliance with the following ACA reforms:

• community premium rating standards, so consumers might be charged more based on factors such as gender or a pre-existing medical condition, and it might not comply with rules limiting age banding (PHS Act section 2701);
• guaranteed availability and renewability (PHS Act sections 2702 & 2703);
• if the coverage is an individual market policy, the ban on preexisting medical conditions for adults, so it might exclude coverage for treatment of an adult’s pre-existing medical condition such as diabetes or cancer (PHS Act section 2704);
• if the coverage is an individual market policy, discrimination based on health status, so consumers may have premium increases based on claims experience or receipt of health care (PHS Act section 2705);
• coverage of essential health benefits or limit on annual out-of-pocket spending, so it might not cover benefits such as prescription drugs or maternity care, or might have unlimited cost-sharing (PHS Act section 2707); and
• standards for participation in clinical trials, so consumers might not have coverage for services related to a clinical trial for a life-threatening or other serious disease (PHS Act section 2709).

About the Author. This alert was prepared for Benefit Advisors Network by Stacy Barrow.  Mr. Barrow is a nationally recognized expert on the Affordable Care Act.  His firm, Marathas Barrow Weatherhead Lent LLP, is a premier employee benefits, executive compensation and employment law firm.  He can be reached at sbarrow@marbarlaw.com.

Stop Misuse of Family Benefits

Posted on by Bobbi Kloss, BAN Director of Human Capital Management

Written by Stephen Miller, CEBS, including comments from Bobbi Kloss, Benefit Advisors Network Director of Human Capital Management Services. Published on SHRM.org, March 27, 2019.

Some workers intentionally abuse family-perk policies, while others are just confused.

United Airlines fired more than 35 employees in March for selling travel passes intended for employees’ immediate relatives. Free or discounted travel is a common family perk in the airline industry, the Chicago Tribune reported. When selling these passes, sometimes for several thousand dollars apiece, employees falsely registered the buyers as their stepparents or domestic partners.

“The rules are there to make sure everyone can enjoy the benefits,” said Danielle Capilla, Chicago-based director of employee benefits compliance at Alera Group, an insurance and financial services firm. Her father, an airline pilot, made sure everyone in her family understood those rules.

Whether misusing travel perks, allowing relatives to drive a company car or extending discounts to people who aren’t eligible for them, those who violate family-perk policies “think they’re not going to get caught,” Capilla said.

“Abuse of employee benefits and perks is a continuous frustration for employers,” added Bobbi Kloss, HR leader at Benefit Advisors Network, a Cleveland-based consortium of health and welfare benefit brokers. “From the CEO and top executives to the line workers, no level of employee is immune from committing abuses.”

Dependent-Eligibility Audits

A common misuse of family benefits occurs when employees add ineligible relations as family members under their employer’s health plan. To combat this practice, 43 percent of employers routinely conduct dependent-eligibility audits of their health plans, according to a recent report from the nonprofit International Foundation of Employee Benefit Plans. When conducting an audit, HR consultancy Mercer estimates that most companies will find 3 percent to 10 percent of plan members to be ineligible. Given that the average annual cost of each covered dependent is $4,570, Mercer found, the expense of covering ineligible dependents can add up quickly.

Capilla encourages employers to conduct dependent audits “every year if there have been issues, and at least every three years otherwise.”

“Not all misuse is intentional,” said Anna Phalen, vice president of account management at Jellyvision, a benefits communication software firm in Chicago. “In some cases, employees may not know they’re stepping over the line, or they may not be aware there are penalties for doing so.”

One reason workers grow confused over dependent eligibility, Phalen noted, is that the Affordable Care Act allows adult children up to age 26 to stay on a parent’s employer-provided health plan, whether they are dependents or not. Also, in recent years, many benefit plans have expanded their definition of eligible dependents to include unmarried partners and stepchildren. These developments, she said, “make it all the more important to clearly articulate the rules on who qualifies.”

Family Leave Misuse

Misuse of time off is also costly for employers, especially for intermittent absences taken under the Family and Medical Leave Act (FMLA) by employees who don’t actually need to attend to their own or a relative’s health needs.

“You can’t solve for every misuse of leave. But you can design your leave program and policies to help deter misuse,” Capilla said. How employers go about that depends on the problems they’re seeing, she said, joking about the “30 percent of the workforce seeking intermittent FMLA on every sunny Friday.”

[SHRM members-only toolkit: Managing Family and Medical Leave]

Clarify What’s Allowed

Employees may have been told about benefits restrictions when they were hired or went through open enrollment, Phalen said, but that information should be reiterated when they make changes to their benefits, such as adding dependents to a family health plan.

When employees receive a thick handbook during onboarding that’s filled with benefits jargon, “it can be overwhelming,” said Bill Gimbel, president of LaSalle Benefits, an insurance brokerage in the Chicago area. Employers should describe their benefits rules “in terms that are simple enough for all employees to understand, yet thorough,” he said. “A detailed handbook may be helpful for your HR team, but a PowerPoint or visual one-sheeter that provides an overview of your benefits offerings may be better for the rest of your employees.”

Taking Action

Intentional abuse of employer benefits can be a firing offense, and, in some cases, employers may want to sue to reclaim the value of misappropriated benefits or press criminal charges.

However, “for abuses, I advise having a ‘strike’ system,” Capilla said, as in two or three strikes and you’re out. “There are honest mistakes that happen. At the same time, you don’t want to swing to the other end and only slap people on the wrist.”

“No matter what is done to tighten the reins, as long as there are unethical people in the workplace, abuse will continue,” Kloss said. Many employers “jump the gun and discontinue the benefit or perk, affecting all employees instead of addressing the behavior of the abuser,” she added. That can lead to employee morale issues, especially when a discontinued benefit made the job particularly attractive.

To reduce benefits fraud, employee benefits professionals recommend these steps:

  • Work with managers. “Lack of well-being—financial, social, emotional and physical wellness—could be driving employees to make bad choices,” Kloss said. Managers may be able to pick up on those situations. Train your managers to identify signs of misuse, Gimbel added. “Educate them on what to look for, and be sure that they report it back to HR.”
  • Use HR software. Software can be used to track the receipt of health providers’ certifications and recertifications for FMLA leave requests, for instance, which can help expose abuses, Gimbel said.
  • Stay organized and be proactive. Regularly track and monitor benefits use, whether through spreadsheets, online forms or HR information systems, Gimbel advised. “If, along the way, your team catches wind of potential benefits misuse, be proactive and address it immediately.”

View the article Stop Misuse of Family Benefits on SHRM.org

Employee Benefit Plan Review

Posted on by Perry Braun

Written by Perry S. Braun, Benefit Advisors Network’s Executive Director. Published in Employee Benefit Plan Review, March/April 2019 issue.

What Can Employer Sponsored Benefit Plans Expect from a Divided Federal Government?

While much of the focus in 2018 came down to the elections, we now have those results and can begin moving forward. But, with a divided Congress what will the impact be on the insurance marketplace, the healthcare delivery system, the advisors and employers that interact (plan, strategize, implement, and execute) and most importantly, the employees that participate in the employer sponsored benefit plan?

Policies: What to Expect
Following the Kavanaugh hearing Senator Jeff Flake commented that he would have voted differently regarding the Federal Bureau of Investigation inquiry if he was running for re-election. This comment paints a picture that our representatives to Congress are concerned with advancing policies that secure their re-election rather than the wellbeing of the constituents they represent. With that backdrop, the status quo will be the likely outcome with regard to the current state of the Affordable Care Act (ACA) and America’s Health Insurance Plans (AHIP) until the 2020 election.

Are there policies/regulations that the parties could agree on? There are two observations assuming any policy change will support two goals – re-election and benefit to their constituents.

One, if there is any change in policy, it could be in a bipartisan approach to address prescription drug cost and the impact of prescription drugs on the health and safety of the community. The national discussion around opioids, the increase in drug prices on certain medications, as well as the lack of generic equivalents are issues that both parties wish to address from a policy perspective.

However, this represents a change on the margins and not a repeal of the program offered through President Obama or the alternative program offered by President Trump. Further, an incremental approach will not have any true and meaningful impact on the cost of healthcare – which is supposed to be the focus. Rather, the focus will be on insurance or premium reform.

The second observation is that while the focus has been on health and healthcare policy – which is really a tremendous amount of energy and no action – there is not an equal amount of attention being given to regulations for employers and advisors to meet, which come with real economic consequences, for example, fines and penalties.

The Next Two Years
So, with no one party in control of Congress and the executive branch, what does the next two years look like? Likely, the parties will be eyeing the 2020 presidential election and one of the key topics will be what the social contract with America looks like.

For example, the “crushing” national debt, cost of healthcare cost, the cost of tuition and the educational debt, and income disparity and burden this has on the vast majority of individuals in this country will push political parties to renew calls to address this situation, 2 March/April 2019 Employee Benefit Plan Review however, their energy to tackle this and their solutions will greatly differ.

The debate may focus on one or more of the following strategies to win over the hearts and minds of the voting public – raise tax revenues, cut government costs, or a combination of both.

If raising tax revenues is chosen, the impact on the individual is important. It is certain that all taxpayers will need to contribute some amount of tax revenue to buy down the debt. But, with the median household income hovering right around $60,000 and the average American household carrying $137,000 in debt, the problem becomes pretty clear: most people are not… [read more]

An Update on the DOL’s 2016 Wage Injunction

Posted on by Bobbi Kloss, BAN Director of Human Capital Management

Written by Bobbi Kloss, Director of Human Capital Management Services, Benefit Advisors Network. Published in Entertainment Human Resource Network, February 2019 edition.

Silent but ever present, the Wage and Hour division of the Department of Labor (DOL) has been working its way back to updating the overtime exemptions for the Administrative, Executive and Professional exemptions otherwise known as White Collar exemptions. These White Collar exemptions set standards by which employees who have met the established standards are exempt from having to be paid time and one half salary for working over 40 hours in a work week. With a weekly earning threshold of $455.00, as one of these requirements to meet the exemption test, which has not been increased since 2004, it is a guessing game as to how much of an adjustment will be made at the salary level. While the DOL had previously issued regulations with an increase to $913 weekly, or $47,476 annually, that ruling was halted… [read more]