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Congress Expected To Pass COVID-19 Relief Bill With Paid Leave Mandates & Expanded Unemployment Funding This Week

March 15, 2020

U.S. employers need to prepare for their likely need to deal with paid family medical leave, paid sick leave, unemployment insurance and other employer impacting provisions of the “Families First Coronavirus Response Act,” (H.R. 6201) passed by the House of Representatives last week and expected to pass the Senate in some form this week as part of Congressional efforts to mitigate impacts of disruptions of the COVID-19 containment disruptions. Since the paid leave mandates would take effect 15 days from enactment, employers will want to prepare to comply and take into account the likely mandates when planning and communicating with workers and dealing with other financial and operational disruptions from the crisis.Solutions Law Press, INC. is planning to host a briefing for employers on the requirements after passed by Congress. For an invitation, register at http://www.solutiinslawpress.com or email here.

Paid Family Medical Leave

As passed by the House, the paid leave requirements currently only apply to employers with fewer than 500 employees and are accompanied by tax credit provisions intended to help covered businesses pay the cost of compliance. The bill’s paid leave requirements add special job-protected paid leave to the Family and Medical Leave Act (FMLA) for employees who have been working for at least 30 calendar days. In particular, covered employees would be entitled to 12 weeks of paid family leave, of which the first 14 days may be unpaid, to respond to quarantine requirements or recommendations, to care for family members who are responding to quarantine requirements or recommendations, and to care for a child whose school has been closed as a result of the COVID-19 pandemic (“COVID Leave”). The bill also provides employees may. but employers can’t require employees to use accrued personal or sick leave during the first 14 days. After the initial 14 days, covered employers must compensate employees in an amount that is not less than two-thirds of the employee’s regular rate of pay. Because the leave is FMLA covered, employers should expect to be required to continue health coverage during the leave at usual employee contribution rates and to reinstate the employee to their position with all benefits and employment rights and seniority upon timely return. The provisions will take effect 15 days after the date of enactment and expire on December 31, 2020.

Paid Sick Leave

Employers with fewer than 500 employees will be required to provide full-time employees 2 weeks (80 hours) of paid sick leave for COVID-19 specific circumstances related to COVID-19 such as self-isolating, doctors’ visits or the like. Part-time employees would be entitled to the number of hours of paid sick time equal to the average number of hours worked over a 2-week period.

Employers must pay employees for any paid sick time taken at their regular rates of pay and will be required to post a notice informing employees of their rights to leave.

Since the bill expressly does not, as currently drafted, the bill expressly provides that it does not preempt existing state or local paid sick leave entitlements, employers also could face additional requirements under state or local law.

Like the COVID leave, these provisions also will go into effect 15 days after the date of enactment and expire on December 31, 2020.

Unemployment Insurance

The bill also includes $1 billion in emergency unemployment insurance (UI) relief to the states: $500 million for costs associated with increased administration of each state’s unemployment insurance (“UI”) program and places $500 million in reserve to help states with a 10 percent increase in unemployment. To receive a portion of this grant money, states mustveclerience the required increase in unemployment and temporarily ease certain UI eligibility requirements, such as waiting periods and work search requirements.

Prospects For Enactment

Although some Senators raised questions about certain provisions of the bill, it is expected to pass in some form this week as Congress and the Administration rush to provide relief for workers and business impacted by the economic effects of the COVID-18 pandemic containment efforts. Accordingly, covered employers should expect Congress to pass and President Trump to sign the bill this week. Meanwhile all employers also should brace for added legislation and regulation as well as continued operational and financial disruption as the COVID-19 virus impacts continue to roll out across the U.S. and around the World.

More Information

We hope this update is helpful. For more information about the these or other health or other legal, management or public policy developments, please contact the author Cynthia Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.

Solutions Law Press, Inc. invites you receive future updates by registering on our Solutions Law Press, Inc. Website and participating and contributing to the discussions in our Solutions Law Press, Inc. LinkedIn SLP Health Care Risk Management & Operations Group, HR & Benefits Update Compliance Group, and/or Coalition for Responsible Health Care Policy.

About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 30+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pandemic and other health and safety, financial, workforce and other organizational crisis, change and workforce, employee benefit, health care and other operations planning, preparedness and response for more than 30 years. As a part of this work, she regularly advises businesses and government leaders on an an demand and ongoing basis about preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day to day operations, through times of change and in response to operational, health care, natural disaster, economic and other crisis and change.

Author of “Privacy and the Pandemic Workshop” for the Association of State and Territorial Health Plans, “How to Conduct A Reduction In Force,” and a multitude of other highly regarded publications and presentations on workforce, compliance, health care and health benefits, pandemic and other health crisis, workers’ compensation and occupational disease, business disaster and distress and many other topics, Ms. Stamer has worked with employers, insurers, health industry organizations and providers and domestic and international community and government leaders on pandemic and other health and safety, workforce and performance preparedness, risks and change management, disaster preparedness and response and other operational and tactical concerns throughout her adult life. A former lead advisor to the Government of Bolivia on its pension privaitization project, Ms. Stamer also has worked internationally as an advisor to business, community and government leaders on crisis preparedness and response, workforce, health care and other reform, as well as regularly advises and defends organizations about the design, administration and defense of their organizations workforce, employee benefit and compensation, safety, discipline and other management practices and actions.

Board Certified in Labor and Employment Law By the Texas Board of Legal Specialization, Scribe for the ABA JCEB Annual Agency Meeting with OCR, Vice Chair of the ABA International Section Life Sciences Committee, and the ABA RPTE Employee Benefits & Other Compensation Group and and a former Council Representative, Past Chair of the ABA Managed Care & Insurance Interest Group, former Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, and a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her extensive publications and thought leadership as well as leadership involvement in a broad range of other professional and civic organizations. For more information about Ms. Stamer or her health industry and other experience and involvements, see http://www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources available here

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation considering the specific facts and circumstances presented in their unique circumstance at the particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author reserves the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law constantly and often rapidly evolves, subsequent developments that could impact the currency and completeness of this discussion are likely. The author and Solutions Law Press, Inc. disclaim, and have no responsibility to provide any update or otherwise notify anyone of any fact or law specific nuance, change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication.

Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

©2020 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ For information about republication, please contact the author directly. All other rights reserved.

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Posted by Cynthia Marcotte Stamer

Federal Veterans Hiring Benchmark Resets 3/31 To 5.9%; Prepare For Audits & Other Enforcement

March 27, 2019

The just announced March 31, 2019 update of the the Annual Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA) hiring benchmark for federal government contractors and subcontractors changes to 5.9% provides an important reminder to U.S. employers to review and tighten the compliance of their recruiting, hiring, employment, compensation and benefits, and other policies and practices to withstand growing scrutiny and enforcement risks under federal laws.

Government contractors, subcontractors and other U.S businesses should reconfirm their compliance with the new benchmark and other VEVRAA requirements for dealing with veterans in light of the Trump Administration’s continuing emphasis on enforcing it and other federal laws protecting active duty military and veteran servicemen and women. As part of these enforcement efforts the Office of Federal Contract Compliance Programs (“OFCCP”) has announced it plans to incorporate VEVRAA Focused Reviews into the Corporate Scheduling Announcement List next fiscal year.

The Department of Labor announced the new 5.9% 2019 benchmark today (March 27, 2019). At the same time, it also updated national and state information in the VEVRAA Benchmark Database for federal contractors and subcontractors who calculate an individualized hiring benchmark using the five-factor method.

With already large active duty and veteran population set to grow as the withdrawal of troops from Afghanistan and other deployments continues, the need for employers to properly honor the rights of active duty and returning service members under VEVRAA, USERRA, the expanded military related medical leave rules of the Family & Medical Leave Act and other applicable laws is more important than ever. For many businesses, active duty and veteran service members constitute valuable sources of qualified workers amid an increasingly competitive labor market. On the other hands, the special legal obligations and protections afforded these workers requires that businesses use care to meet these obligations. Failing to meet or exceed hiring benchmarks or other noncompliance with federal requirements and goals can cause federal contractors and subcontractors to incur liability for breaching federal contracts and laws. In addition, employers generally face substantial employment liability for violating VEVRRA, the Uniformed Services Employment and Reemployment Act or other applicable federal or state laws. See, e.g. Enforcement e.g., Michael Sipos and Gary Smith v. FlightSafety Services Corporation, Co. Consent Decree (April 4, 2013); Mervin Jones v. Jerome County Sheriff’s Office, ID complaint (January 7, 2013); Service Members to Receive $39 Million for Violations of the Servicemembers Civil Relief Act; Justice Department Settles Disability Discrimination Case Involving Disabled Veteran in Utah; Justice Department Reaches $12 Million Settlement to Resolve Violations of the Servicemembers Civil Relief Act by Capital One; and Justice Department Files Complaint Against Forsyth County, North Carolina, Sheriff for Violating the Employment Rights of Army National Guard Soldier.

VEVRRA & USERRA Protections For Active Duty Military & Veterans

Affirmative action hiring by government contractors and subcontractors is one of the VEVRRA requirements for government contractors and subcontractors to provide assistance to and protect returning veterans from employment discrimination.

One of two key federal laws specifically prohibiting discrimination against returning veterans, VEVRRA applies only to government contractors and subcontractors. The other law, the Uniformed Services Employment and Reemployment Rights Act (USERRA), applies to virtually all U.S. employers.

Among other things, VEVRAA and its implementing regulations impose affirmative action requirements that require federal contractors and subcontractors to monitor and improve efforts to recruit and hire “protected veterans.” Protected veterans generally include veterans who are:

Disabled veterans: Those who are “entitled to compensation…under laws administered by the Secretary of Veterans Affairs” or “those who were released from active duty because of a service-connected disability;
Recently separated veterans;
Active duty wartime or campaign veterans;
Campaign badge veterans; and
Armed Forces service medal veterans.

Among other things, VEVRAA and its implementing Final Regulations generally require government contractors and subcontractors:

To set a hiring benchmark by either: (1) adopting a benchmark based on the national percentage of veterans currently in the workforce (5.9% effective March 31, 2019); or (2) creating an individualized benchmark based on their own interpretation of the best available data nationally and within their state/region.
Invite voluntary self-identification of applicants and employees as protected veterans. Pre-offer invitation to self-identify will involve asking whether the applicant believes that s/he is a protected veteran under VEVRAA without asking about the particular category of protection. Post-offer self-identification will request information regarding the specific category of protected veteran status. For Sample self-identification forms for both pre- and post-offer forms, see Appendix B Part 60-300 of the Final Regulation.
Comply with OFCCP reviews including providing on-site and off-site access to documents needed for compliance and focused reviews.
Track and report the effectiveness of veteran recruiting and hiring efforts by collecting specified data, which also must be retained for three years.
Provide access to job listings that identify the employer as a federal contractor in a format that can be used by veterans’ Employment Service Delivery Systems (ESDS).
Use mandated language in federal contracts (including subcontracts) to communicate the contractor’s obligations to employ and advance protected veterans.
Find and use appropriate outreach and positive recruitment activities like the Department of Defense Transition Assistance Program; the National Resource Directory and other sources contractorsfeel will be helpful in identifying and attracting veterans.

While VEVRRA only applies to government contractors and subcontractors, USERRA generally applies to all employers.

USERRA generally provides that an individual who leaves a job to serve in the uniformed services is generally entitled to continue medical coverage for up to 26 months while absent for a qualifying military leave, reemployment by the previous employer upon timely return from military leave and, upon reemployment, to restoration of service, promotion, benefits and other rights of employment.

As part of these reemployment rights, qualifying service members timely returning from military leave are entitled to receive credit for benefits, including employee pension plan benefits, that would have accrued but for the employee’s absence due to the military service. USERRA’s pension-related provisions generally require that pension plans treat a service member who is called to active duty as if the service member had no break in service for purpose of the administration of pension benefits when the service member timely returns to employment at the end of a military leave. In addition to these pension rights, USERRA also requires employers honor other rights to employment, promotion and other benefits and rights of employment.

Beyond these VEVRRA and USERRA employment rights, service members taking or returning from active duty often enjoy various other employment and other protections under various other federal and state laws, many of which have been expanded in recent years.

As many veterans suffer return with physical, cognitive or emotional injuries and conditions, veteran applicants and employees may qualify for the disability discrimination, accommodation, privacy and other protections of the Americans with Disabilities Act (ADA) and, in the case of government contractors and subcontractors, the Section 503 of the Rehabilitation Act.

Under requirements of the Soldiers’ and Sailors’ Civil Relief Act (SSCRA), creditors including a pension plan, employer loan program or credit union generally are required to drop interest charges down to 6 percent on debt owed by those called to active duty for the period of such military service. Further, under the Employee Retirement Income Security Act (ERISA), the loan will not fail to be a qualified loan under ERISA solely because the interest rate is capped by SSCRA. These and other provisions of federal law often require pension and profit-sharing plans that allow plan loans to change loan terms and tailor other special treatment of participants who are on military leave.

In addition to the specific protection given to a service member, employers also need to be ready to honor certain family leave protections afforded to qualifying family members or caregivers of service members added to the Family & Medical Leave Act (FMLA) in recent years. As amended to include these military leave related protections, the FMLA may require certain employees who are the spouse, son, daughter, or parent of a military member to take to 12 weeks of FMLA leave during any 12-month period to address the most common issues that arise when a military member is deployed to a foreign country, such as attending military sponsored functions, making appropriate financial and legal arrangements, and arranging for alternative childcare. This provision applies to the families of members of both the active duty and reserve components of the Armed Forces. Meanwhile, the “Military Caregiver Leave” provisions added to the FMLA may entitle certain employees who are the spouse, son, daughter, parent or next of kin of a covered service member to up to 26 weeks of FMLA leave during a single 12-month period to care for the service member who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness incurred or aggravated in the line of duty on active duty. These provisions apply to the families of members of both the active duty and reserve components of the Armed Forces. The expansion of these requirements, updating of regulation, and rising enforcement by private plaintiffs and the government make it advisable that businesses take all necessary steps to ensure their employment practices, employee benefit plans, fringe benefit programs and other practices are updated and administered to comply with the current requirements of VEVRRA, USERAA, SSCRA, the FMLA and other applicable federal and state laws.

Special care also generally is needed when designing and administering employment based health benefit programs to avoid violating federal eligibility rules prohibiting discrimination against service members, to properly offer continuation coverage and reinstatement during and following periods of service by employees and family members, and to avoid improper denial of coverage or coordination of benefit rules with military and veteran health benefits.

Given the potential liabilities that can result from noncompliance with these and other federal employment rules and requirements protecting active military and veteran service men and women, U.S. employer generally should reconfirm and carefully monitor and document their compliance with these laws to minimize their liability exposure. Where employers use subcontractors or otherwise outsource work, these businesses also should consider require their subcontractors and other service providers to contract to comply with these requirements, to supply data and other documentation that the employer might need to complete reports or otherwise defend its compliance, to cooperate in audits and other investigations, and to participate and cooperate with employer initiated compliance audits as well as government audits and investigations.

Need more information about veterans’ employment or other Human Resources, employee benefits, compensation or other performance and compliance management, check out the extensive training and other resources available on the author’s website or contact the author, Cynthia Marcotte Stamer.

We also invite you to share your own best practices ideas and resources and join the discussions about these and other human resources, health and other employee benefit and patient empowerment concerns by participating and contributing to the discussions in our Health Plan Compliance Group or COPE: Coalition On Patient Empowerment Groupon LinkedIn or Project COPE: Coalition on Patient Empowerment Facebook Page.

About the Author

Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer has advised, trained, coached and defended businesses, employee benefit plans and others, published, and problem solved on opportunities and challenges relating to employment, benefits consumer, health care, disability and other rights and needs of active duty and veteran service people and their families.

Ms. Stamer’s clients include employers and other workforce management organizations; employer, union, association, government and other insured and self-insured health and other employee benefit plan sponsors, benefit plans, fiduciaries, administrators, and other plan vendors; domestic and international public and private health care, education and other community service and care organizations; managed care organizations; insurers, third-party administrative services organizations and other payer organizations; and other private and government organizations and their management leaders.

Throughout her 30 plus year career, Ms. Stamer has continuously worked with these and other management clients to design, implement, document, administer and defend hiring, performance management, compensation, promotion, demotion, discipline, reduction in force and other workforce, employee benefit, insurance and risk management, health and safety, and other programs, products and solutions, and practices; establish and administer compliance and risk management policies; comply with requirements, investigate and respond to government, accreditation and quality organizations, regulatory and contractual audits, private litigation and other federal and state reviews, investigations and enforcement actions; evaluate and influence legislative and regulatory reforms and other regulatory and public policy advocacy; prepare and present training and discipline; handle workforce and related change management associated with mergers, acquisitions, reductions in force, re-engineering, and other change management; and a host of other workforce related concerns. Ms. Stamer’s experience in these matters includes supporting these organizations and their leaders on both a real-time, “on demand” basis with crisis preparedness, intervention and response as well as consulting and representing clients on ongoing compliance and risk management; plan and program design; vendor and employee credentialing, selection, contracting, performance management and other dealings; strategic planning; policy, program, product and services development and innovation; mergers, acquisitions, bankruptcy and other crisis and change management; management, and other opportunities and challenges arising in the course of workforce and other operations management to improve performance while managing workforce, compensation and benefits and other legal and operational liability and performance.

Past Chair of the ABA Managed Care & Insurance Interest Group and, a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, heavily involved in health benefit, health care, health, financial and other information technology, data and related process and systems development, policy and operations throughout her career, and scribe of the ABA JCEB annual Office of Civil Rights agency meeting, Ms. Stamer also is widely recognized for her extensive work and leadership on leading edge health care and benefit policy and operational issues. She regularly helps employer and other health benefit plan sponsors and vendors, health industry, insurers, health IT, life sciences and other health and insurance industry clients design, document and enforce plans, practices, policies, systems and solutions; manage regulatory, contractual and other legal and operational compliance; vendors and suppliers; deal with Medicare, Medicaid, CHIP, Medicare/Medicaid Advantage, ERISA, state insurance law and other private payer rules and requirements; contracting; licensing; terms of participation; medical billing, reimbursement, claims administration and coordination, and other provider-payer relations; reporting and disclosure, government investigations and enforcement, privacy and data security; and other compliance and enforcement; Form 990 and other nonprofit and tax-exemption; fundraising, investors, joint venture, and other business partners; quality and other performance measurement, management, discipline and reporting; physician and other workforce recruiting, performance management, peer review and other investigations and discipline, wage and hour, payroll, gain-sharing and other pay-for performance and other compensation, training, outsourcing and other human resources and workforce matters; board, medical staff and other governance; strategic planning, process and quality improvement; HIPAA health care, financial, tax, HR and technology, privacy, data security and breach; health care, insurance, and other fraud prevention, investigation, defense and enforcement; audits, investigations, and enforcement actions; trade secrets and other intellectual property; crisis preparedness and response; internal, government and third-party licensure, credentialing, accreditation, HCQIA, HEDIS and other peer review and quality reporting, audits, investigations, enforcement and defense; patient relations and care; internal controls and regulatory compliance; payer-provider, provider-provider, vendor, patient, governmental and community relations; facilities, practice, products and other sales, mergers, acquisitions and other business and commercial transactions; government procurement and contracting; grants; tax-exemption and not-for-profit; 1557 and other Civil Rights; privacy and data security; training; risk and change management; regulatory affairs and public policy; process, product and service improvement, development and innovation, and other legal and operational compliance and risk management, government and regulatory affairs and operations concerns.

A former lead consultant to the Government of Bolivia on its Pension Privatization Project with extensive domestic and international public policy concerns in pensions, healthcare, workforce, immigration, tax, education and other areas, Ms. Stamer has been extensively involved in U.S. federal, state and local health care and other legislative and regulatory reform impacting these concerns throughout her career. Her public policy and regulatory affairs experience encompasses advising and representing domestic and multinational private sector health, insurance, employee benefit, employer, staffing and other outsourced service providers, and other clients in dealings with Congress, state legislatures, and federal, state and local regulators and government entities, as well as providing advice and input to U.S. and foreign government leaders on these and other policy concerns.

Author of leading works on a multitude of labor and employment, compensation and benefits, internal controls and compliance, and risk management matters and a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her thought leadership, experience and advocacy on these and other related concerns by her service in the leadership of the Solutions Law Press, Inc. Coalition for Responsible Health Policy, its PROJECT COPE: Coalition on Patient Empowerment, and a broad range of other professional and civic organizations including North Texas Healthcare Compliance Association, a founding Board Member and past President of the Alliance for Healthcare Excellence, past Board Member and Board Compliance Committee Chair for the National Kidney Foundation of North Texas; former Board President of the early childhood development intervention agency, The Richardson Development Center for Children (now Warren Center For Children); current Vice Chair of the ABA Tort & Insurance Practice Section Employee Benefits Committee, current Vice Chair of Policy for the Life Sciences Committee of the ABA International Section, Past Chair of the ABA Health Law Section Managed Care & Insurance Section, a current Defined Contribution Plan Committee Co-Chair, former Group Chair and Co-Chair of the ABA RPTE Section Employee Benefits Group, past Representative and chair of various committees of ABA Joint Committee on Employee Benefits; an ABA Health Law Coordinating Council representative, former Coordinator and a Vice-Chair of the Gulf Coast TEGE Council TE Division, past Chair of the Dallas Bar Association Employee Benefits & Executive Compensation Committee, a former member of the Board of Directors of the Southwest Benefits Association and others.

For more information about Ms. Stamer or her services, experience and involvements, see here or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here. We also invite you to join the discussion of these and other human resources, health and other employee benefit and patient empowerment concerns by participating and contributing to the discussions in our Health Plan Compliance Group or COPE: Coalition On Patient Empowerment Groupon LinkedIn or Project COPE: Coalition on Patient Empowerment Facebook Page.

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author reserves the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The presenter and the program sponsor disclaim, and have no responsibility to provide any update or otherwise notify any participant of any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication.

©2019 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.™ For information about republication or the topic of this article, please contact the author directly. All other rights reserved.

Comments Off on Federal Veterans Hiring Benchmark Resets 3/31 To 5.9%; Prepare For Audits & Other Enforcement | Affirmative Action, Civil Rights, Construction, Employee Benefits, Employee Handbook, Employer, Employers, Employment, Employment Discrimination, Employment Policies, enforcement, Government Contractors, HR, Human Resources, Leave, Military Leave, OFCCP, Uncategorized, USERRA, veterans, VEVRAA, VEVRRA, Wage & Hour, Worker | Tagged: Affirmative Action, Discrimination, Employee Benefits, Employer, Employment, Government Contractors, Health Insurance, Health Plans, veterans | Permalink
Posted by Cynthia Marcotte Stamer

$350K Settlement Highlights Need For Plans & Plan Service Providers To Ensure Security, Business Associate & Other HIPAA Requirements Met

May 24, 2023

A newly announced Department of Health and Human Services Office of Civil Rights (“OCR”) Health Insurance Portability and Accountability Act (“HIPAA”) settlement agreement with a medical practice manager business associate highlights the need for health plans and other HIPAA covered entities ensure servers are properly secured and that that they and every third party administrator, technology, audit, accounting and other plan service provider with access to protected health information (“business associate”) can prove all necessary business associate agreements,m security safeguards and other policies and practices are in place in the event of a HIPAA breach, audit or other compliance event.

The latest warning comes from OCR’s May 16, 2023 announcement that medical practice manager MedEvolve, Inc. (“MedEvolve”) paid OCR $350,000 and committed to a corrective action plan under a resolution agreement reached to settle OCR charges that MedEvolve violated HIPAA by failing to properly secure servers containing its covered entity clients’ PHI, not obtaining required business associate agreements with business associate subcontractors, and violating other HIPAA requirements. Like many service providers to medical practices, health plans or other HIPAA covered entities, MedEvolve was subject to HIPAA’s Privacy, Security, Breach Notification and business associate agreement requirements due to its access, possession, use, protection, and disclosure of PHI in the course of servicing its covered entity customers.

HIPAA Privacy, Security and Breach Rules Generally

HIPAA generally requires health care providers, health plans and insurers, health care clearinghouses (“covered entities”) and business associates to maintain the privacy and security of PHI as required by HIPAA. In addition, HIPAA’s Security Rule requires covered entities and their business associates to conduct risk assessments and implement and administer appropriate safeguards and procedures to protect electronic PHI from improper use, access, disclosure or destruction and in the event of a breach, to provide notification and take other action required by HIPAA’s Breach Notification Rule. HIPAA’s business associate rules also require both covered entities and their business associates to enter into business associate agreements that document the business associate’s commitment to adhere to HIPAA’s Privacy, Security and Breach Notification Rules before a business associate accesses PHI.

Violators of these and other HIPAA Privacy, Security and Data Breach rules risk substantial civil monetary penalties assessed based of the culpability of the violation and adjusted annually for inflation. Based on the most recent annual inflation adjustments made in 2022, the current indexed penalty amounts as of May 24, 2023 for each violation of a HIPAA are follows:

Tier 1—lack of knowledge: The minimum penalty is $127; the maximum penalty is $63,973; and the calendar-year cap is $1,919,173.
Tier 2—reasonable cause and not willful neglect: The minimum penalty is $1,280; the maximum penalty is $63,973; and the calendar-year cap is $1,919,173.
Tier 3—willful neglect, corrected within 30 days: The minimum penalty is $12,794; the maximum penalty is $63,973; and the calendar-year cap is $1,919,173.
Tier 4—willful neglect, not corrected within 30 days: The minimum penalty is $63,973; the maximum penalty is $1,919,173 and the calendar-year cap is $1,919,173.

These amounts almost certainly will increase further when 2023 inflation adjustments are published.

While OCR can impose these significant civil monetary penalties for HIPAA violations, most violations are resolved outside the cumbersome and costly civil monetary penalty process. Under HIPAA, OCR possesses the authority to negotiate resolution agreements with covered entities and business associates that allow covered entities and business associates OCR accuses of violating the HIPAA Privacy, Security or Breach Notification Rules to settle HIPAA charges without the assessment of authorized civil monetary penalties. The vast majority of HIPAA violations found by OCR are resolved through the resolution agreement process since the OCR typically sets the required settlement payment amount below the maximum civil monetary penalty amount and the accused party avoids the cost and disruption of the civil monetary process. The newly announced MedEvolve settlement is the latest resolution of HIPAA violation charges announced by OCR

$350,000 MedEvolve Resolution Agreement Highlights Server and Service Provider Risk

The HIPAA charges against MedEvolve arose from deficiencies in MedEvolve’s implementation of its responsibilities to secure data, obtain business associate agreements with any subcontractors given access to client PHI, and other HIPAA obligations assumed under its business associate agreements with its customers. While MedEvolve’s customers generally were medical practices or other health care providers, self-insured health plans, health insurers and health plan service providers subject to HIPAA as covered entities and business associates often also rely upon third-party systems or services that involve sharing of health plan PHI with or rely upon third party provided servers, technology or other resources to collect and administer health plan data and administer health plan functions.

The OCR investigation of MedEvolve began in response to a series of breach notifications filed by MedEvolve with OCR. As a provider of practice management, revenue cycle management, and practice analytics software services to medical practices, MedEvolve was a business associate responsible for the collection and administration of PHI for the health care providers it served.

OCR’s investigation began after MedEvolve notified OCR of a breach of PHI’s on its server through an initial Breach Notification Report filed on July 10, 2018, which it supplemented by addendums filed on July 30, 2018 and August 12, 2020 (the “Reports”). According to the Reports, MedEvolve discovered on May 4, 2018 that a File Transfer Protocol (FTP) server containing PHI had been unsecure and accessible on the internet since January 1, 2018. The breach affected the PHI of a total of 230,572 individuals at two covered entities for which MedEvolve provided software and revenue cycle management services: Premier Immediate Medical Care, LLC (204,607 individuals affected) and the office of Dr. Beverly Held (25,965 individuals affected). The breached information included patient names, billing addresses, telephone numbers, primary health insurer and doctor’s office account numbers, and in some cases Social Security numbers. The OCR investigation uncovered evidence that PHI for both covered entities was viewed by at least one unauthorized individual while the FTP server was open to the public.

Based on its investigation, OCR concluded that MedEvolve violated HIPAA by:

Allowing the disclosure of PHI of 230,572 individuals;
Failing to enter into a business associate agreement with a subcontractor;
Failing to conduct a sufficiently accurate or thorough risk assessment of the potential risks and vulnerabilities to the confidentiality, integrity, and availability of ePHI held by it as a business associate was not sufficiently accurate or thorough.

To avoid the potentially much more significant civil monetary penalties that HIPAA authorizes OCR to impose for such breaches, MedEvolve entered into a resolution agreement with OCR that required MedEvolve to pay OCR $350,000 payment and take a series of corrective actions specified in the corrective action plan included in the resolution agreement. To benefit from the resolution agreement, the resolution agreement requires MedEvolve to fully implement and adhere to all requirements of the corrective action plan including:

Conducting and preparing a report satisfactory to OCR of its complete risk assessment within 30 days and annually thereafter of the security risks and vulnerabilities of all electronic equipment, data systems, programs and applications controlled, administered, owned, or shared by MedEvolve or its affiliates that are owned, controlled or managed by MedEvolve that contain, store, transmit or receive MedEvolve ePHI;
Developing and implementing to the satisfaction of OCR an enterprise-wide risk management plan to address and mitigate any security risks and vulnerabilities identified in the risk analysis which includes a process and timeline for MedEvolve’s implementation, evaluation, and revision of its risk remediation activities;
Developing, maintaining, and revising, as necessary, to the satisfaction of OCR its written business associate agreements and any other policies and procedures to comply with Federal standards that govern the privacy and security of PHI;
Conducting training on the adopted HIPAA policies and procedures;
Retain all documents and records relating to compliance with the corrective action plan for six years from the effective date of the corrective action plan; and
If MedEvolve receives information that a workforce member may have failed to comply with the HIPAA policies and procedures (a “Reportable Event”), investigate promptly and notify HHS about its investigation findings within 60 days;
Submit to OCR monitoring for at least two years; and
Various other requirements for reporting, certification and notification to OCR.

MedEvolve agrees in the resolution agreement that OCR may treat as a breach and assess civil monetary penalties under HIPAA in the event of any failure by MedEvolve to fully comply with all requirements of the corrective action plan.

Warning To Other Health Plans and Other HIPAA Regulated Entities To Secure Servers And Other Systems With PHI

OCR’s announcement of the MedEvolve resolution agreement pointedly warns other covered entities and business associates to ensure the adequacy of their own and their business associates’ network and other servers and other HIPAA compliance as well as highlights many common compliance weaknesses that place covered entities and business associates at risk.

“Ensuring that security measures are in place to protect electronic protected health information where it is stored is an integral part of cybersecurity and the protection of patient privacy,” said OCR Director Melanie Fontes Rainer. “HIPAA regulated entities must ensure that they are not leaving patient health information unsecured on network servers available to the public via the internet.”

The MedEvolve server breach is one of the most common sources of HIPAA sanctions. Deficiencies in the security of servers of covered entities or their business associates are common HIPAA compliance deficiencies and raise significant enforcement and liability risks when a breach happens. Hacking/IT incidents were the most frequent (79%) type of large breach reported to OCR in 2022. Network servers are the largest category by location for breaches involving these large breaches.

Along with the frequency of these events, the risk of enforcement for server breaches is heightened by HIPAA breach reporting and investigation protocols. The HIPAA Breach Rule mandates expedited reporting for breaches of unsecured PHI affecting 500 or more people. As a matter of policy, OCR investigates every large breach report. Consequently, it is critical that HIPAA covered entities and their business associates use appropriate documented processes to identify, deter, protect against, detect, and respond to cybersecurity threats and malicious actors involving their servers. Timely notification can mitigate exposure to additional liability for untimely breach notification. Where a large breach occurs, however, a covered entity or business associate can expect an investigation of the source of the breach as well as its overall compliance.

The resolution agreement also illustrates how HIPAA breach liability can arise from subcontracting of HIPAA covered responsibilities by a covered entity or business associate without ensuring the necessary business associate agreements and other HIPAA safeguards are implemented.

In light of reminders from enforcements like the MedEvolve resolution agreement, all covered entities and business associates should take documented steps to confirm the adequacy of security of all covered entity and business associate servers and other networks and storage devices with electronic PHI currently, whenever updates or other changes are implemented when evidence of potential compromise happens as well as on a scheduled periodic basis. Covered entities and business associates also should verify that they have in place appropriate business associate agreements with every service provider allowed to use, access or disclose PHI.

Covered entities and business associates may wish to supplement the basic business associate agreement requirements mandated by the HIPAA Rules with additional safeguards providing for periodic reassurances or certifications of ongoing compliance, audit and investigation commitments, notification and other requirements regarding the use of subcontractors or delegated systems or services, provisions on indemnification and insurance commitments or other safeguards.

For More Information

We hope this update is helpful. For more information about these or other health or other employee benefit, insurance, health care, workforce or other legal, management or public policyresponsibilities or developments, please contact the author Cynthia Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.

Solutions Law Press, Inc. invites you to receive future updates by registering on our Solutions Law Press, Inc. Website and participating and contributing to the discussions in our Solutions Law Press, Inc. LinkedIn SLP Health Care Risk Management & Operations Group, HR & Benefits Update Compliance Group, and/or Coalition for Responsible Health Care Policy.

About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 35+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pregnancy, disability and other discrimination, leave, health and safety, and other workforce, employee benefit, health care and other operations planning, preparedness and response for more than 35 years. As a part of this work, she regularly advises businesses and government leaders on an on-demand and ongoing basis about preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day to day operations, through times of change and in response to complaints, investigations and enforcement.

Author of a multitude of other highly regarded publications and presentations on MHPAEA and other and health and other benefits, workforce, compliance, workers’ compensation and occupational disease, business disaster and distress and many other topics, Ms. Stamer has worked with health plans, employers, insurers, government leaders and others on these and other health benefit, workforce and performance and other operational and tactical concerns throughout her adult life.

A former lead advisor to the Government of Bolivia on its pension privatization project, Ms. Stamer also has worked domestically and internationally as an advisor to business, community and government leaders on health, severance, disability, pension and other workforce, health care and other reform, as well as regularly advises and defends organizations about the design, administration and defense of their organization’s workforce, employee benefit and compensation, safety, discipline and other management practices and actions.

Board Certified in Labor and Employment Law By the Texas Board of Legal Specialization, Scribe for the ABA JCEB Annual Agency Meeting with OCR, Chair-Elect of the ABA TIPS Medicine and Law Committee, Chair of the ABA International Section Life Sciences Committee, and Past Group Chair and current Welfare Plan Committee Chair of the ABA RPTE Employee Benefits & Other Compensation Group, former Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, and a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer also shares her extensive publications and thought leadership as well as leadership involvement in a broad range of other professional and civic organizations. For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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Posted by Cynthia Marcotte Stamer

EEOC COVID Guidance, Enforcement Highlights Need To Brace For COVID-Related ADA & Other Claims

May 17, 2023

Updated guidance published by the Equal Employment Opportunity Commission (“EEOC”) warns employers that the end of the COVID-19 health care emergency did not automatically end employers’ responsibilities to provide accommodations granted during the COVID-19 health care emergency, to consider new requests for accommodation from applicants or employees claiming disability from COVID-19 or other pandemic related conditions, or to comply with the medical confidentiality, interference and retaliation rules of the Americans with Disabilities Act.

EEOC Update COVID-19 Guidance For End Of Emergency

On May 15, 2023, the EEOC updated its publication on “What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws” (the “Guidance”) to add supplement its prior guidance about the effect of the ADA and other federal discrimination laws during the COVID-19 health care emergency (the “Emergency”) to include guidance on the effect of the end of the federal declaration of the COVID-19 public health emergency that happened on May 11, 2023.

Since its original publication, the Guidance has made clear that the Americans with Disabilities Act (ADA) and the Rehabilitation Act workplace disability nondiscrimination, reasonable accommodation, and employer medical examinations and inquiries); Title VII of the Civil Rights Act prohibitions against race, color, national origin, religion, and sex, including pregnancy; Age Discrimination in Employment Act prohibitions against individuals age 40 or older; and the Genetic Information Nondiscrimination Act rules (collectively, the “EEO Laws”) remain in effect during the Emergency. The Guidance also addressed a wide range of issues about how these EEO Laws applied during the Emergency and to COVID-19, including disability-related inquiries and medical examinations, how the definition of disability may apply to COVID-19 and Long COVID, confidentiality, reasonable accommodation based on disability, harassment, and vaccinations (including reasonable accommodation based on disability or religious beliefs). The May 15, 2023 updates to the Guidance address the implications of the May 11, 2023 end of the Emergency on these obligations as well as updates previously shared guidance on employer COVID-19 screening, testing, vaccination and other practices following the end of the Emergency.

Among other things, the Guidance confirms an employer must maintain and keep all information about a COVID-19 or any other illness or other medical information about an applicant or employee confidential and in a separate file in accordance with the ADA medical confidentiality rules. The Guidance also confirms despite the end of the Emergency that an employer:

Should consult and follow current Centers for Disease Control (“CDC”) guidance about when and how long a worker with COVID-19 or COVID-19 symptoms should stay home or may safely return to the workplace;
May exclude employees with COVID-19 or COVID-19 symptoms associated with the workplace when consistent with CDC-recommended isolation protocols.
May ask all employees who will be physically entering the workplace or otherwise working in close proximity with others if they have COVID-19 or common symptoms associated with COVID-19 as identified by CDC and if they have been tested for COVID-19 and if so, ask about the result;
May not ask an employee who is physically coming into the workplace whether they have family members who have COVID-19 or COVID-19 symptoms;
May only require employees to submit to having their temperature taken, COVID-19 testing or other medical screening when the employer can demonstrate that the testing meets the ADA “business necessity” standard or otherwise follows current CDC recommendations;
May ask an employee calling in sick, reporting illness while at work, or returning from travel whether the employee has COVID-19 or common symptoms of COVID-19 as identified by the CDC and if the employee responds affirmatively, the employer may follow any CDC-recommended period of isolation with respect to when an employee may return to the workplace or otherwise work in close proximity to others. The Guidance also addresses what other information an employer may ask an employee calling in sick, reporting illness while in the workplace, or returning following a period of absence due to COVID-19 infection.

The Guidance also makes clear the EEOC interprets the ADA as requiring covered employers to continue to comply with the ADA and the Rehabilitation Act requirements for evaluating and granting requests for accommodation received from applicants or employees during and after the end of the Emergency including requests by applicants or employees that may qualify as disabled due to long-COVID and other pandemic-related conditions. The Guidance makes clear that this generally means that a covered employer must evaluate accommodations granted during the Emergency or requested post-Emergency to assess whether an employee or applicant is disabled within the meaning of the ADA and if so, if there exists a need to provide reasonable accommodation based on individualized circumstances.

Regarding accommodation requests for employees qualifying as disabled from long-COVID, the Guidance shares common examples of possible reasonable accommodations, including a quiet workspace, use of noise canceling devices, and uninterrupted work time to address brain fog; alternative lighting and reducing glare to address headaches; rest breaks to address joint pain or shortness of breath; a flexible schedule or telework to address fatigue; and removal of “marginal functions” that involve physical exertion to address shortness of breath.

The updated Guidance also warns employers of their continued responsibility to remain alert for and prevent COVID-related harassment of applicants or employees with a disability-related need to continue wearing a face mask or take other COVID-19 precautions at work as well as to prevent retaliation in the workplace against employees or applicants in violation of the ADA or other EEO Laws.

In all cases, the updated Guidance also alerts employers that changed risks, CDC guidance and other circumstances following the end of the Emergency may eliminate or undermine an employer’s ability to justify the denial of COVID-19 related accommodations as consistent with current CDC guidelines or as a business necessity.

Employers Face Heightened COVID-19 Related Disability Risks

EEOC complaint and enforcement data as well as private litigation trends signal the advisability for covered employers to prepare to defend against ADA and Rehabilitation Act disability or other EEO Law discrimination, accommodation, leave and retaliation complaints. Between April 2020 and December 2021, for instance, the EEOC reports receiving roughly 6,225 COVID-related discrimination charges. The EEOC already has launched a plethora of lawsuits and other enforcement actions in response to many of these complaints. See, e.g. EEOC Sues Total Systems Services for Disability Discrimination and Retaliation (March 29, 2023); EEOC Sues United Labor Agency for Disability Discrimination (February 15, 2023). The EEOC’s inclusion of ’employment discrimination associated with the COVID-19 pandemic and other threats to public health’ as among its priorities in its EEOC Draft Strategic Enforcement Plan published in January, 2023 reflects it plans to continue this heightened enforcement activity in the 2023 fiscal year paying particular attention to “discriminatory practices associated with the COVID-19 pandemic and other threats to public health,” such as:

pandemic-related harassment based on race, national origin, religion, disability, age, gender, or other protected characteristics;
unlawful denials of accommodations to individuals with disabilities or individuals with sincerely held religious beliefs, practices, or observances;
unlawful medical inquiries, improper direct threat determinations, or other discrimination related to disabilities that arose during or were exacerbated by the pandemic;
discrimination against persons who have an actual disability or are regarded as having a disability related to COVID-19, including individuals with long COVID, and pandemic-related caregiver discrimination based on a protected characteristic.”

In light of the aggressive EEOC complaint and enforcement record, all employers covered by the ADA, the Rehabilitation Act or other EEO Laws should be concerned about their likely elevated exposure to COVID-19 associated disability or other related EEO Law charges and lawsuits. should review and update their existing workplace practices, policies, accommodation practices and decisions, and related communications to verify their defensibility in light of the end of the Emergency. When conducting this review, most employers also should reassess the continued appropriateness of prior or current accommodation decisions in light of changed CDC guidance and other circumstances that may impact on the business’s ability to justify these decisions in light of changed circumstances. Because of the likely sensitivity of discussions and analysis arising in connection with these assessments, employers may wish to seek the advice of qualified legal counsel regarding these evaluations as well as opportunities to structure them to safeguard potentially sensitive discussions within the protection of attorney-client privilege.

More Information

We hope this update is helpful. For more information about these or other health or other legal, management or public policy developments, please contact the author Cynthia Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.

About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 35+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pregnancy, disability and other discrimination, leave, health and safety, and other workforce, employee benefit, health care and other operations planning, preparedness and response for more than 35 years. As a part of this work, she regularly advises businesses and government leaders on an on-demand and ongoing basis about preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day to day operations, through times of change and in response to complaints, investigations and enforcement.

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Austin Bar Faces EEOC Pregnancy Discrimination Suit Before Added PWFA Protections Take Effect June 27

May 15, 2023

An Austin, Texas bar faces an Equal Employment Opportunity Commission (“EEOC”) lawsuit after allegedly firing a worker for being pregnant. The suit sends a warning to employers about the risks of pregnancy discrimination as protections for pregnancy are set to expand when the federal Pregnant Worker Fairness Act (PWFA) becomes effective next month.

The lawsuit signals the REOC’s continuing commitment to enforce pregnancy discrimination laws including new pregnancy accommodation mandates set to take effect June 27. The Pregnant Workers Fairness Act (PWFA), set to go into effect on June 27, 2023, will require employers to provide a reasonable accommodation to workers for known limitations related to pregnancy, childbirth, or related medical conditions.

The pregnancy discrimination suit filed by the EEOC accuses Corner Bar with illegally discriminating against a female bartender by reducing her hours and terminating her because she was pregnant.

According to the EEOC’s suit, the female bartender told her managers she was pregnant. Soon after her pregnancy became visible, her hours were cut and she was taken off the closing shifts, which were among the most profitable. Corner Bar later informed the bartender in a phone call that the business was “parting ways” with her, the EEOC said.

The lawsuit against three limited liability companies that operate Corner Bar and other Austin-area hospitality businesses charges the alleged conduct violates Title VII of the Civil Right Act of 1964, as amended by the Pregnancy Discrimination Act, which prohibits discrimination based on pregnancy. The EEOC is seeking back pay, compensatory and punitive damages, and appropriate injunctive relief to prevent similar discriminatory practices in the future.

The EEOC announcement of the lawsuit warns other businesses against pregnancy discrimination.

“This lawsuit should serve to remind employers that federal law clearly prohibits employers from discriminating against employees on the basis of pregnancy, childbirth or related medical conditions,” said Philip Moss, a trial attorney with the EEOC’s San Antonio Field Office. “The EEOC remains committed to fighting discrimination based on sex in the workplace, including pregnancy discrimination, in all of its forms.”

The announcement also makes clear this readiness extends to the impending requirements of the PWFA. Robert Canino, regional attorney for the Dallas District Office, added, “Employers violate discrimination laws when they deny women opportunities based on stereotypes and unfounded assumptions about what they are able to do during and after pregnancies. As a matter of fact, the importance of these workplace pregnancy discrimination issues is further re-enforced by the federal Pregnant Worker Fairness Act (PWFA), which becomes effective next month.”

All covered employers should take immediate steps to update policies, postings, training and practices to ensure their ability to defend their compliance with the PWFA and other federal and state pregnancy discrimination, leave and accommodation requirements.

More Information

About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 35+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pregnancy, disability and other discrimination, leave, health and safety, and other workforce, employee benefit, health care and other operations planning, preparedness and response for more than 35 years. As a part of this work, she regularly advises businesses and government leaders on an on-demand and ongoing basis about preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day to day operations, through times of change and in response to complaints, investigations and enforcement.

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Education Association Union Sued For Race Discrimination

May 4, 2023

Discrimination lawsuits against employers are common. Suits against unions are rare. However that’s what’s happening to Sunnybrook Education Association, IEA-NEA, (“Sunnybrook Union”), a labor union representing teachers and educational support personnel in the Sunnybrook School District.

In the lawsuit EEOC v. Sunnybrook Education Association, IEA-NEA, 1:23-cv-02804) filed in the U.S. District Court of Illinois, Northern District, Eastern Division today, the Equal Employment Opportunity Commission (“EEOC”) charges Sunnybrook Union with violating federal civil rights law by blocking the promotion of an African American custodian to the role of head custodian because of his race,

The EEOC said that Sunnybrook Union grieved the promotion of a Black employee of Sunnybrook School District 171 rather than ignoring the promotion or negotiating a memorandum of understanding, as it had done in other cases where non-Black employees received promotions or salaries that did not conform to the collective bargaining agreement (“CBA”).

The lawsuit charges this conduct violates Title VII of the Civil Rights Act, which prohibits labor organizations from discriminating against members on the basis of race and causing or attempting to cause an employer to discriminate against an individual because of their race, sex, religion, or other protected class. The EEOC is seeking full relief, including back pay, compensatory damages, punitive damages, and a commitment from the union to permit the employee to receive his promotion and raise.

Comments of EEOC officials about the lawsuit show the EEOC is serious about prosecution of workplace race discrimination whether committed by labor or management. “The Sunnybrook Union should be opening doors for the employees it represents, not standing in the way of their advancement,” said Gregory Gochanour, the EEOC’s regional attorney in Chicago. “Here, we have an employee doing the job of a head custodian but prevented from receiving the benefits of that job because of his race.”

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About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 35+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pregnancy, disability and other discrimination, leave, health and safety, and other workforce, employee benefit, health care and other operations planning, preparedness and response for more than 35 years. As a part of this work, she regularly advises businesses and government leaders on an on-demand and ongoing basis about preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day to day operations, through times of change and in response to complaints, investigations and enforcement.

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Biden-⁠Harris Administration Ending COVID-⁠19 Vaccination Requirements For Federal Employees, Contractors, International Travelers, Head Start Educators & CMS-Certified Facilities

May 3, 2023

COVID-19 vaccination requirements for federal contractors and employees, Centers for Medicare and Medicaid (“CMS”) certified health care and other providers, Head Start educators and international travelers implemented in 2021 in response to the COVID-19 health care emergency.

The Whitehouse announced requirements for Federal employees, Federal contractors, and international air travelers will end at the end of the day on May 11, the same day that the COVID-19 public health emergency ends. Additionally, the Department of Health and Human Services (“HHS”) and Department of Homeland Security (“DHS”) also announced they are starting the process to end their vaccination requirements for Head Start educators, CMS-certified healthcare facilities, and certain noncitizens at the land border at a date to be announced soon.

Once the applicable mandate ends, organizations subject to these mandates, like private sector organizations not currently subject to them, will need to decide whether and when their organizations will impose these mandates as part of their occupational health and safety policies.

Organizations deciding to continue requiring vaccination will need to design their program to appropriately accommodate disability and religious concerns of employees in accordance with Equal Employment Opportunity Commission rules.

All organizations also need to use care to avoid discrimination or retaliation against workers in violation of federal laws and to address requests for accommodation for employees suffering from long COVID.

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About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 35+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pandemic and other health and safety, financial, workforce and other organizational crisis, change and workforce, employee benefit, health care and other operations planning, preparedness and response for more than 30 years. As a part of this work, she regularly advises businesses and government leaders on an an demand and ongoing basis about preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day to day operations, through times of change and in response to operational, health care, natural disaster, economic and other crisis and change.

A former lead advisor to the Government of Bolivia on its pension privaitization project, Ms. Stamer also has worked domestically and internationally as an advisor to business, community and government leaders on health, severance, disability, pension and other workforce, health care and other reform, as well as regularly advises and defends organizations about the design, administration and defense of their organization’s workforce, employee benefit and compensation, safety, discipline and other management practices and actions.

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Autism Health Plan Exclusions and Limitations May Trigger Mental Health Parity and Addiction Equity Act Liabilities

May 1, 2023

Group health plans and insurers must ensure their programs don’t violate the Mental Health Parity and Addiction Equity Act (“MHPAEA”) by improperly limiting or excluding coverage for the treatment of autism or mental therapy developmental disorders.

MHPAEA requires group health plans and health insurance issuers that offer mental health benefits to ensure that mental health benefit financial requirements and nonquantitative treatment limitations are generally no more restrictive than those applied to medical/surgical benefits. The Department of Labor Employee Benefit Security Administration (“EBSA”) has identified MHPAEA autism and other mental health and substance abuse coverage enforcement as a key priority in its current fiscal year enforcement plan. Violation of its prohibitions is costly. Aside from any costs of providing wrongfully denied coverage and defense costs for resulting investigations and enforcement, violations generally also trigger that the employer is accountable for self-identifying, reporting and paying excise tax penalties imposed for MHPAEA violations under Internal Revenue Code Section 6039D to avoid even more penalties unless an exception applies.

Although many diagnosticians and courts consider autism a neurological rather than psychological disorder, EBSA often interprets and enforces MHPAEA as applicable to Applied Behavior (ABA) therapy and other treatment for autism, For instance, an EBSA Benefits Advisor stepped in to assist a Seattle family encountering difficulty communicating with their health plan regarding claims for their child the plan reprocessed the claims, resulting in an additional $20,000 of coverage. Another parent contacted an EBSA Benefits Advisor in the Dallas Regional Office for assistance with claims that had not been paid. After the Advisor contacted the plan to resolve the issue, this family received approximately $24,000 they were owed.

EBSA also has taken more formal enforcement actions in other instances. For example, EBSA’s Los Angeles Regional Office recently investigated a large service provider that excluded coverage for ABA therapy in hundreds of self-insured plans. The EBSA investigation resulted in 3 plans removing their exclusion for ABA therapy and offering coverage for that benefit moving forward, affecting more than 18,000 participants and their beneficiaries.

Meanwhile, an investigation by EBSA’s Chicago and Dallas Regional Offices into an ABA therapy exclusion resulted in a large claims administrator adding ABA therapy as a default coverage option for all of its self-insured plans. This correction resulted in the elimination of the exclusion of ABA therapy for autism for nearly one million participants.

To protect access to autism benefits, EBSA also works closely with other federal agencies, such as the U.S. Department of Health and Human Services. For example, EBSA assisted HHS’ Centers for Medicare and Medicaid Services in investigating an improper appeals process following the denial of coverage for autism treatment by a plan for a large school district. In the end, the plan reimbursed a total of $2,464 in unpaid claims to the participant.

The actions relating to ABM therapy and other autism-related treatment are part of a broader, high-priority EBSA and Department of Health and Human Services MHPAEA compliance and enforcement initiative which prioritizes enforcement of compliance by health plans and health insurers with MHPAEA’s mandates that health plans and insurance policies of covered health plans and insurers comply with its requirement of parity in the coverage provided for mental health and substance abuse care as compared to other care. To fulfill these requirements, health plans and insurers covered by MHPAEA must be prepared to produce documentation of their audit and analysis to demonstrate that any quantitative or qualitative requirements applicable to mental health or substance abuse coverage in form or operation are not greater than those applied to other comparable benefits. Meeting this burden generally requires significant documented analysis regarding the plan design and administration taking into complicated HPAEA regulations. Additionally, health plans and insurers also should ensure that their administrative practices and notifications comply with additional MHPAEA requirements applicable to claim determinations involving adverse benefit determinations for mental health or substance abuse treatment, as well as otherwise applicable Patient Protection and Affordable Care Act (“ACA”), Employee Retirement Income Security Act (“ERISA”) and for insured plans or policies, state insurance rules.

In the face of these and other enforcement actions, group health plans, their sponsors, their insurers, fiduciaries, administrators and employer and other MHPAEA-covered health benefit program sponsors, fiduciaries and administrators are urged to seek review and advice from legal counsel experienced with MHPAEA and other rules impacting autism diagnosis and treatment coverage about the adequacy and defensibility of their health program as it relates to coverage for autism and other developmental disabilities.

Additionally, employers also are reminded that autism and other developmental and neurological disorders also generally qualify as disabilities qualify for protection against discrimination and require accommodation under the Americans With Disabilities Act (“ADA”).

Along with the EBSA enforcement, private participants and beneficiaries of private employer-sponsored health plans also can bring lawsuits to recover benefits and other relief for violations of MHPAEA. Along with the actual damages, attorneys’ fees and other costs of enforcement, a successful MHPAEA enforcement also typically will reveal the sponsoring employer or union’s failure to make the required self-disclosure and excise tax payments mandated for violations under Internal Revenue Code Section 6039D, triggering added penalties beyond the initial penalties triggered by the uncorrected violation. Furthermore, delayed discovery of these violations also makes correction particularly costly for self-insured plans and their sponsors as deadlines for submitting expenses to qualify for stop loss reimbursement often will have passed by the time the liability comes to light. Accordingly, employer and other health plan sponsors, their fiduciaries and adminstrators generally will want to audit and monitor their health plan’s compliance with the MHPAEA throught the calendar year and as plan year or stop loss filing deadlines approach to mitigate these exposures.

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About the Author

Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 35+ years of health industry and other management work, public policy leadership and advocacy, coaching, teachings, and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally with business, government and community leaders to prepare for and deal with pandemic and other health and safety, financial, workforce and other organizational crisis, change and workforce, employee benefit, health care and other operations planning, preparedness and response for more than 30 years. As a part of this work, she regularly advises businesses and government leaders on an on-demand and ongoing basis about the preparation of workforce, health care and other business and government policies and practices to deal with management in a wide range of contexts ranging from day-to-day operations, through times of change and in response to operational, health care, natural disaster, economic and other crisis and change.

Author of a multitude of other highly regarded publications and presentations on MHPAEA and other health and other benefits, workforce, compliance, workers’ compensation and occupational disease, business disaster and distress and many other topics, Ms. Stamer has worked with health plans, employers, insurers, government leaders and others on these and other health care, health and other benefits, workforce and performance and other operational and tactical concerns throughout her adult life.

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Posted by Cynthia Marcotte Stamer

Labor Department Shares Resources on PERM and H-2A Program Updates

May 1, 2023

Businesse using foreign workers with H-1B visas should check out these webinar materials from the Office of Foreign Labor Certification (OFLC) explaining developments on the new Adverse Effect Wage Rate Rule in the H-2A Program and changes to the new PERM Form ETA-9089 and the PERM Program. Employers of workers hired under these programs must to comply to avoid significant liabilities.

Presentation Materials for the H-2A Program New AEWR Rule:

Presentation Materials for the PERM Program:

Also the Labor Department says a OFLC Stakeholder Webinar on New Form ETA 9089 Recording April 2023 will be available soon.

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About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with gender and other discrimination and others workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators.

A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving, and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

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Posted by Cynthia Marcotte Stamer

Trucking Cos.’ $1.25M Sex Discrimination warns Other Employers

April 25, 2023

R&L Carriers, Inc. and R&L Carriers, Shared Services, LLC (R&L Carriers), a nationwide trucking company headquartered in Wilmington, Ohio, will pay $1,250,000 to a class of female applicants and take steps to prevent future discrimination against female applicants to settle a federal lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC).

Title VII of the Civil Right Act of 1964 which prohibits discrimination based on an applicant’s sex.

The settlement announced by the EEOC today resolves an EEOC’s lawsuit that charged R&L Carriers discriminated against women hiring for Wilmington, Ohio loader positions at least from January 1, 2010 to December 31, 2017. Although a few women were hired as loaders, the company rejected or steered most female applicants to different positions because of their sex. Applicants and other witnesses stated they were told R&L Carriers did not hire women for loader positions. The alleged discriminatory conduct resulted in a large difference in the percentage of female applicants who were hired compared to male applicants who were hired.

Under the consent decree resolving the suit, the $1.25 million settlement fund will be handled by a claims administrator paid for by R&L Carriers. In the next few months, the EEOC and the claims administrator will make efforts to locate the women to whom the money will be distributed. The EEOC has set up an information line for additional information on the settlement.

The decree also orders R&L Carriers not to discriminate against female applicants at its Wilmington facility, and requires other equitable and affirmative relief, including that R&L Carriers train its hiring officials in legal hiring procedures and notify its recruiters and employees not to discriminate against women in hiring for loader positions. R&L Carriers also must invite rejected female applicants to reapply for Wilmington loader positions and engage in outreach and recruitment efforts related to employing women as loaders.

EEOC Warns Other Businesses

The settlement serves as a warning to other businesses not to engage in gender discrimination. The EEOC announcement of the settlement quotes EEOC Chair Charlotte A. Burrows as stating, “The law requires companies to make hiring decisions based on an applicant’s qualifications, not gender stereotypes. The EEOC will continue working to ensure that job opportunities in trucking and all industries are available to all qualified workers, regardless of gender.”

EEOC Indianapolis District Office Director Kenneth Bird’s statement provides an even more pointed warning, stating, “Sex discrimination is illegal and will not be tolerated, …Employers should be on notice the EEOC will act aggressively to protect people from this type of discrimination. Employers cannot hire women for only some positions while excluding them from other positions.”

Businesss must recognize that adoption of policies in periodic training alone is an inadequate defense to potential sex or other gender discrimination charges. In addition to prohibiting discrimination and training their leader ship, and other workforce, Business is also should monitor recruitment, hiring, discipline, promotion and other aspects of their employment experience for statistical or other evidence of bias in the process. Along with these steps, businesses also provide mechanisms for reporting and conduct exit interviews to help uncover possible claims of prohibited bias or retaliation and should carefully respond to and investigate any reported or observed concerns.

More Information

About the Author

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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Posted by Cynthia Marcotte Stamer

$167K In Backpay and Penalties Restaurant Paying For FLSA Violations Warns Other Businesses

April 18, 2023

The $167,000 paid by Jurassic Street Tacos for failing to pay overtime, and keep required records cautions other employers about the importance of ensuring their own compliance with the Fair Labor Standards Act (“FLSA”).

The payment resolves U.S. Department of Labor’s Wage and Hour Division charges that the street tacos restaurant operator violated the FLSA by paying straight time for all hours worked and, by doing so, failed to pay overtime for hours over 40 in a workweek. The division also discovered the employer did not maintain accurate time records as the law requires. The Labor Department required Jurassic Street Tacos to pay $ 83,539 in back wages and $83,539 in liquidated damages to 56 workers

Precautionary Lesson For Other Businesses

Employers caught making this mistake, can face back pay awards for the unpaid overtime, plus assessments of interest and penalties. To avoid these exposures, employers should consult with qualified legal counsel to confirm their proper treatment of all aspects of compensation paid to nonexempt employees for purposes of overtime, and other wage in our purposes.

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About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

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Posted by Cynthia Marcotte Stamer

$400,000 Settlement Shows Risks Of Mishandling Pregnant Employees

April 12, 2023

Nursing home and rehabilitation operator Symphony Deerbrook, LLC’s $400,000 payment and other relief to settle a pregnancy discrimination lawsuit brought by the U.S. Equal Employment Opportunity Commission (EEOC) warns other health industry and other employers about the risk of imposing special pregnancy notice, doctors, release and testing requirements on pregnant employees.

In its lawsuit, the EEOC charged that Symphony implemented a policy requiring employees to inform the company of any pregnancy and to obtain a note from their doctor releasing them to work without restrictions. The EEOC also alleged that Symphony denied employees with pregnancy-related restrictions reasonable accommodations and terminated them though other employees with similar restrictions were provided accommodations.

The EEOC charged these actions violatesd the Pregnancy Discrimination Act of Title VII, 42 U.S.C. 2000e(K) and 2000e-(2)(a)(1) and the Americans with Disabilities Act, 42 U.S.C. § 12112(d)(3)(C)(4)(a).

The Pregnancy Act prohibits employers from discrimination on the basis of pregnancy and requires that employers treat pregnant employees the same as other employees who are similar in their ability or inability to work.

The ADA which prohibits employee medical examinations that are not job related or consistent with business necessity.

The consent decree settling the suit requires Symphony to pay $400,000, which will be distributed among 11 affected employees. The two-and-a-half-year decree enjoins Symphony from discrimination on the basis of pregnancy in the future, including denying pregnant workers job modifications available to other similar employees and requiring pregnant employees to obtain doctor’s notes stating that they can work without restriction.

In 2021, Symphony sold the facility to Pearl of Joliet, who agreed for purposes of settlement to provide anti-discrimination training to all its employees at the facility, to post a notice about the resolution of the law lawsuit, and to report to EEOC certain types of information during the decree’s term. The EEOC has not alleged that Pearl engaged in any discrimination.

Suits and settlements like Symphony’s send a clear warning against discrimination based on pregnancy by health care providers and other employers. Healthcare and other organizations concerned about the safety of pregnant women working in particular positions should ask experienced legal counsel for assistance in managing the occupational health and safety risks, if any for pregnant or other employees without running afoul of discrimination prohibitions.

More Information

About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

Comments Off on $400,000 Settlement Shows Risks Of Mishandling Pregnant Employees | Corporate Compliance | Tagged: ADA, Corporate Compliance, Discrimination, Employer, Employment, Human Resources, Labor Department, OSHA, pregnancy discrimination, Risk Management | Permalink
Posted by Cynthia Marcotte Stamer

National Origin Discrimination Judgement Against Dallas Property Manager Warns Other Busin

April 6, 2023

Dallas-based property management company, Alden Short and Hinson Jennings, LLC (“Alden Short”) will pay $85,000 and furnish other relief under a consent degree entered in the EEOC v. Alden Short & Hinson Jennings, LLC national origin harassment lawsuit. Part of the deluge of discrimination suits the EEOC is prosecuting under the Biden Administration’s civil rights agenda, the litigation highlights the advisability of all employers covered by federal discrimination laws to tighten their compliance and risk management efforts.

Alden Short Judgement

The U.S. Equal Employment Opportunity Commission (“EEOC”) originally filed the lawsuit in the Northern District of Texas in 2018 pursuant to Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. §2000e et seq. (“Title VII”), and Title I of the Civil Rights Act of 1991, 42. U.S.C. §1981a,

The EEOC alleges that that owner and president and the chief operating officer (COO) of Alden Alden Short subjected Claudia Guardiola, Linda Spears, and Leticia Stewart to a hostile work environment in violationn of federal law because of their Hispanic national origin by making disparaging comments relating to their national origin to the employees relating to their heritage, parents and children.

According to Assistant Regional Attorney Suzanne Anderson, one former employee said the COO told her he could treat her any way he wanted to because she is Mexican. Alden Short and Hinson Jennings to Pay $85,000 to Settle EEOC National Origin Discrimination Suit (April 6, 2023).

According to EEOC Trial Attorney Brooke López, the employees complained because these companies rent to tenants in predominantly Hispanic communities, yet management treated their Hispanic employees with disparagement or discrimination, Id.

The EEOC alleged this comment violated Title VII of the Civil Rights Act of 1964, which prohibits discrimination based on national origin.

Prior to agreeing to the consent decree, Alden Short in October, 2020 unsuccessfully sought summary judgment on the suit, arguing insufficient evidence to raise a genuine dispute of material fact regarding the third and forth elements of the EEOC’s hostile work environment claim as required to establish a prima facie case of harassment as well as that Alden Short was not an employer under Title VII

In his September 21, 2021 opinion denying summary judgment to Alden Short, U.S. District Judge Sam Lindsey noted that while the EEOC characterized the alleged improper discrimination as national origin discrimination, the allegations in the EEOC’s Complaint more clearly alleged a race claim, as the Complaint suggested but does not expressly state the womens’ country of birth or that of their ancestors. In ruling the failure to allege the country of origin in the complaint insufficient to merit summary judgement, Judge Lindsey noted:

National origin, though often confused with race, refers to “the country where a person was born, or, more broadly, the country from which his or her ancestors came.” Espinoza v. Farrah Mfg. Co., 414 U.S. 86, 88 (1973). In any event, in some contexts national origin and racial discrimination are “so closely related . . . as to be indistinguishable.” Bullard v. OMI Georgia, Inc., 640 F.2d 632, 634 (5th Cir. Unit B 1981). Discrimination against Hispanics is often referred to interchangeably under both of these categories. Cf., e.g., Gonzalez v. Trinity Marine Group, Inc., 117 F.3d 894, 895-96(5th Cir. 1997) (claim under 42 U.S.C. § 1981). Accordingly, the court will consider the EEOC’s Complaint as sufficiently alleging a claim for discrimination based on national origin.

In addition to paying the any uninsured legal defense costs of the protracted litigation, the three-year consent decree settling the suit entered April 4, 2023 orders Alden Short to pay $85,000 in damages to the Hispanic employees, prohibits its future discrimination and requires Alden Short to develop and implement a new employee handbook and to provide employees with annual training on discrimination.

Discrimination Exposures Heightened

The Alden Short lawsuit and order are illustrative of the rise in EEOC and private civil rights and other employment discrimination and retaliation investigations, charges, and lawsuits under the proactive civil rights agenda of the Biden Administration.

In pursuit of its mission to advance equal employment opportunity, the EEOC focused on several major areas during FY 2022, including aggressive educational outreach, addressing systemic discrimination, advancing racial justice in the workplace, enforcing pay equity, and addressing the use of artificial intelligence in employment decisions.

Among other things, the EEOC 2022 Annual Performance Report (APR) (“2022 Data”) shows EEOC has seen an uptick in complaints filed by workers. In Fiscal Year (“FY”) 2022, the agency received 73,485 new discrimination charges, which represents an increase of almost 20% when compared to the previous fiscal year. The agency also handled more than 475,000 calls —an 18% increase from FY 2021—and managed 32% more emails from the public than the previous year.

To help manage the increased demand and strengthen the agency’s ability to prevent and remedy employment discrimination, the EEOC specifically focused on growing its workforce to meet growing requests for its assistance by filling 352 new positions and 500 total staff vacancies in FY 2022, the majority of which were in frontline positions.

The effects of this proactivity is confirmed by the 2022 EEOC enforcement data. The agency marked several significant accomplishments in FY 2022.

Obtained more than $513 million in monetary benefits for victims of discrimination, an increase from the previous fiscal year;
Resolved over 65,000 charges of discrimination.

Meanwhile in the federal sector, the EEOC:

Conducted more than 3,000 free outreach events reaching almost 220,000 individuals.
Resolved 9,336 hearings;
Recovered more than $132 million for federal workers and applicants; and
Significantly reduced the federal hearing inventory by 25% from FY 2021 to FY 2022

EEOC appears to be continuing its aggressive enforcement into 2023. In March, 2023 alone, for instance, the EEOC announced the following discrimination and retaliation enforcement actions and results:

Manage Exposures

These and other developments, send a strong message to businesses and business leaders to audit and strengthen their employment, discrimination and retaliation compliance and risk management efforts. When assessing risk, businesses should keep in mind the possibility that COVID-19 related operational disturbances likely affected compliance oversight, investigations, training, recordkeeping and other risk management. COVID and post COVID job changes also offer new fodder for potential retaliation claims. Staffing changes also may affect the availability of critical witnesses and their testimony. Businesses should review their situation broadly within the scope of attorney-client privilege when assessing a particular charge or their broader organizational risk. Reassessment if the adequacy of liability insurance and other reserves also may make sense. Public companies also should weigh their prospectus and other disclosure obligations.

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About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

Comments Off on National Origin Discrimination Judgement Against Dallas Property Manager Warns Other Busin | board of directors, citizenship, Civil Rights, compliance, Construction, Corporate Compliance, corporate governance, directors, Discrimination, Diversity, EEOC, employee, Employee Handbook, Employer, Employers, Employment, Employment Discrimination, Employment Policies, Government Contractors, national origin, Race Discrimination | Permalink
Posted by Cynthia Marcotte Stamer

DOJ Activision Lawsuit Sign Of Broader Workforce Related Antitrust Risks Under Biden Administration

April 4, 2023

A federal antitrust lawsuit and proposed consent decree filed the U.S. Department of Justice Antitrust Division (“DOJ”} on April 3, 2023 against one of the world’s largest video game developers and publishers Activision Blizzard, Inc. (“Activision”) demonstrates DOJ’s resolve to move forward on its recently announced policy of weaponizing federal antitrust law against anticompetitive compensation and other labor market practices in response to President Biden’s Executive Order on Promoting Competition in the American Economy, With DOJ and other agencies moving aggressively both to tighten regulatory restraints on longstanding business practices that limit wages and worker competition in the labor force and simultaneously to investigate and challenge perceived anticompetitive workforce practices, all businesses should review and take advisable steps to strengthen the defensibility of any compensation or other workforce or business practices or arrangements likely to invite government or private antitrust challenges.

DOJ Activision Lawsuit

The DOJ Complaint in U.S. vs. Activision Blizzard, Inc. filed in the U.S. District Court for the District of Columbia on April 3, 2023 alleges Activision and the independently-owned teams in two esports leagues owned and operated by Activision violated Federal antitrust law by implementing a so-called Competitive Balance Tax that penalized teams in the Overwatch and Call of Duty Leagues if a team’s player compensation exceeded a threshold set by Activision.

The Overwatch and Call of Duty Leagues, like other sports leagues, feature independently owned teams that not only compete to win matches, but also compete to hire and retain the best players. Because Overwatch and Call of Duty are both multiplayer, team-based games, teams in the Overwatch and Call of Duty Leagues must recruit and sign a roster of players who fill distinct roles within the game and can work with and complement their teammates’ skills.

The Complaint alleges the Tax had the purpose and effect of limiting competition between the teams and suppressing esports players’ wages, many of which spend thousands of hours honing their skills for a chance to sign with a professional team. Under Activision’s “Competitive Balance Tax,” rules, Activision pressured teams to limit player compensation and minimized the risk that one team would substantially outbid another for a player by fining teams dollar for dollar if their total player compensation exceeded a threshold set by Activision each year. For every dollar a team spent over that threshold, Activision fined the team one dollar and distributed the collected sum pro rata to all non-offending teams in the league.. The Complaint charges the Tax not only harmed the highest-paid players, but also depressed wages for all players on a team. For example, if a team wanted to pay a large salary to one player, the team would have to pay less to the other players on the team to avoid the Tax. Teams also understood that the Tax incentivized their competitors to limit player compensation in the same way, further exacerbating the Tax’s anticompetitive effects.

The DOJ Complaint charges the agreements between Activision and the teams in the Overwatch and Call of Duty Leagues to impose the Competitive Balance Tax constituted an unreasonable restraint of trade in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1. While acknowledging that players in other professional sports leagues have agreed to salary restrictions as part of collective bargaining agreements subject to antitrust exemptions for such collectively bargained limits, the Complaint distinguished the limitations on the players in Activision’s esports leagues as the Activision esports players are not members of a union and never negotiated or bargained for these rules. Accordingly, Activision should be enjoined from implementing the Competitive Balance Tax or any similar rule or restraint that, directly or indirectly, imposes an upper limit on compensation for any player or players in any professional esports league that Activision owns or controls.

A proposed consent decree filed by DOJ concurrently with the Compliant would prohibit Activision from imposing any rule that would, directly or indirectly, limit player compensation or that would tax, fine, or otherwise penalize any team for exceeding a certain amount of compensation for its players in any of Activision’s professional esports leagues. The proposed consent decree with Activision also would require Activision to certify that it has ended all Competitive Balance Taxes in its professional esports leagues, to implement revised antitrust compliance and whistleblower protection policies, and to provide notice and an explanation of the final judgment to teams and players in its professional esports leagues.

As required by the Tunney Act, the proposed consent decree, along with the competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed consent decree during a 60-day comment period to Chief, Civil Conduct Task Force, Antitrust Division, Department of Justice, 450 Fifth Street NW, Suite 8600, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the final judgment upon finding it is in the public interest.

Broaden Biden Administration War On “Anticompetitive Labor Market Abuses

The Activision lawsuit is part of a broader focus of the Antitrust Division on using federal antitrust law to combat perceived “anticompetitive labor market abuses” in response to President Biden’s Executive Order on Promoting Competition in the American Economy, in which among other things, President Biden affirmed it is the policy of his Administration “to enforce the antitrust laws to combat the excessive concentration of industry, the abuses of market power, and the harmful effects of monopoly and monopsony — especially as these issues arise in labor market” such as noncompete agreements and other practices that restrict ability of workers to compete for wages or other terms of work. As part of the Executive Order’s call for a “total government” attack on these and other identified anticompetitive practices, ordered DOJ, the Department of Labor, the Federal Trade Commission (“FTC”), the National Labor Relations Board (“NLRB”) and other agencies to take all action within their power to put an end to anticompetitive labor practices.

In response to the Executive Order, DOJ, FTC and the NLRB have agreed to cooperate in the investigation and enforcement of federal laws restricting competition among workers regarding wages or other terms and conditions of employment as well as initiated various regulatory and enforcement projects to further strengthen these efforts.

For instance, the FTC on January 18, 2023 published its proposed Non-Compete Clause Rule published January 18, 2023, whose comment period expired on March 20, 2023.

Among other things, the Proposed Rule:

Would provide it is an unfair method of competition in violation of Section 5 of the FTC Act for an employer to enter into or attempt to enter into a non-compete clause with a worker; maintain with a worker a non-compete clause; or, under certain circumstances, represent to a worker that the worker is subject to a non-compete clause;
Would require employers to rescind existing non-compete clauses no later than the rule’s compliance date; and
Require an employer rescinding a non-compete clause to provide notice to the worker that the worker’s non-compete clause is no longer in effect.

As proposed, the Proposed Rule would reach to employment and a wide range of other services agreements by defining:

The term “employer” as a person that hires or contracts with a worker to work for the personproposed rule would define “worker” as a natural person who works, whether paid or unpaid, for an employer; and
The term “worker” to include an employee, individual classified as an independent contractor, extern, intern, volunteer, apprentice, or sole proprietor who provides a service to a client or customer.

To facilitate compliance, the Proposed Rule would (1) include model language that would satisfy this notice requirementand establish a safe harbor whereby an employer would satisfy the rule’s requirement to rescind existing non-compete clauses where it provides the worker with a notice that complies with this notice requirement.

The Proposed Rule would define the term “non-compete clause” as a contractual term between an employer and a worker that prevents the worker from seeking or accepting employment with a person, or operating a business, after the conclusion of the worker’s employment with the employer.As proposed, however, the Proposed Rule generally would exclude from its definition of a non-compete clause other types of restrictive employment covenants—such as non-disclosure agreements (“NDAs”) and client or customer non-solicitation agreements that generally do not prevent a worker from seeking or accepting employment with a person or operating a business after the conclusion of the worker’s employment with the employers and are not so unusually broad in scope that they function as such.

The Proposed Rule would include a limited exception for non-compete clauses between the seller and buyer of a business.This exception would only apply when the party restricted by the non-compete clause is an owner, member, or partner holding at least a 25% ownership interest in a business entity.The proposed regulatory text would clarify that non-compete clauses covered by this exception would remain subject to federal antitrust law as well as all other applicable law.

The FTC is expected to take quick action to finalize the Proposed Rule now that the comment period has ended. When and if finalized, the requirements of the Proposed Rule are scheduled to take effect 60 days after publication of the Proposed Rule in final form in the Federal Register.

While businesses should stay tuned for further developments regarding the Proposed Rule and other regulatory actions, the DOJ Activision lawsuit and other enforcement actions against businesses attacking compensation or other agreements among competitors impacting workers make clear that businesses immediately could face DOJ or other government or private challenges from their involvement or use of arrangements limiting compensation or other terms of work by workers, nonsolicitation, licensing, antipoaching, noncompete or other practices or agreements historically used by many businesses that have the effect of depressing worker wages or other compensation, freedom to change jobs or other ability to compete in the workplace. In the face of these risks, businesses should consider seeking a review of their existing policies and arrangements for potential exposure under these and other anticompetition regulatory or enforcement changes.

More Information

About the Author

A Fellow in the American College of Employee Benefit Counsel, Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Chair-Elect of the ABA TIPS Section Medicine & Law Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer is most widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on health and managed care and employer benefits legal, public policy and operational concerns.

Ms. Stamer’s work throughout her 30 plus year career has focused heavily on working with health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. Her work has included ongoing involvement in health industry and workforce competition and antitrust issues.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

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Posted by Cynthia Marcotte Stamer

EEOC Race Suit Showcases Rising Business Discrimination & Retaliation Exposures

March 29, 2023

A new race discrimination and retaliation lawsuit filed by the U.S. Equal Employment Opportunity Commission (“EEOC”) against commerce remanufacturer PRC Industries (PRC) warns other businesses of the increased need to use care to protect their own organizations against employment discrimination and retaliation charges under Title VII of the Civil Rights Act of 1964 and other federal laws given the heightened proactivity of the Biden Administration led EEOC in investigation and prosecuting these types of complaints.

PRC Race Suit

According to EEOC’s complaint in EEOC v PRC Industries, Inc. Corp, Case No. 3-27-2023 JJO-VSC, two Black workers, a married couple hired in January 2020 to work at PRC’s Reno, Nevada repair facility faced constant racial taunts and slurs, including the ‘n-word,’ from their supervisors, a brother and sister. The couple also observed the sibling supervisors routinely denigrating other Black employees due to their race. The complaint charges this conduct occurred openly, in front of co-workers and managers. Senior personnel, including a site manager and a vice president, failed to take adequate steps to curb the misconduct, despite being put on notice of the racial harassment. In late-May 2020, when the couple continued to report ongoing offensive treatment, they were fired via text message by one of the supervisors accused of harassment.

The EEOC charges this alleged conduct of tolerating racial harassment and firing the workers for complaining to the EEOC about it violated Title VII of the Civil Rights Act of 1964 which prohibits harassment due to race and requires employers to take prompt action to investigate and stop the misconduct after they receive notice of it.

The EEOC lawsuit in the U.S. District Court for the District of Nevada seeks compensatory and punitive damages, back pay and injunctive relief designed to prevent such discrimination in the future.

EEOC Enforcement Warn Other Businesses

The EEOC press release on the lawsuit warns other businesses and their leaders against committing or tolerating similar or other prohibited discrimination or retaliation.

“Leaders set company culture by the language and conduct they choose to tolerate as well as the behavior they model,” said EEOC San Francisco District Director Nancy Sienko. “Federal civil rights laws mandate that employers act promptly and effectively to stop race-based harassment, and the EEOC will hold employers accountable if they fail to meet their obligations.”

The PRC lawsuit is one of the latest in an accelerating civil rights and other employment discrimination and retaliation investigations, charges, and lawsuits the EEOC is taking in response to the proactive civil rights agenda of the Biden Administration.

The effects of this proactivity is confirmed by the 2022 EEOC enforcement data. The agency marked several significant accomplishments in FY 2022.

Obtained more than $513 million in monetary benefits for victims of discrimination, an increase from the previous fiscal year;
Resolved over 65,000 charges of discrimination.

Meanwhile in the federal sector, the EEOC:

Conducted more than 3,000 free outreach events reaching almost 220,000 individuals.
Resolved 9,336 hearings;
Recovered more than $132 million for federal workers and applicants; and
Significantly reduced the federal hearing inventory by 25% from FY 2021 to FY 2022

EEOC appears to be continuing its aggressive enforcement into 2023. In March, 2023 alone, for instance, the EEOC has announced the following discrimination and retaliation actions

These and other developments, send a strong message to businesses and business leaders to use their compliance and employment, discrimination and retaliation compliance, and risk management efforts. No b

In the face of these developments, businesses and their leaders should move quickly to audit, their current compliance and risk as well as manage their exposures.

In assessing pre-existing risk, businesses should take in to count the likelihood that compliance and operations may have been disrupted during the COVID healthcare emergency. Additional difficulties in investigating and defending risk also may arise because of turnover in management or other staffing. In light of these and other challenges, many businesses may wish to consider acquiring or increasing their employment practices liability as a backstop against these risks.

More Information

About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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Posted by Cynthia Marcotte Stamer

Know When FLSA Overtime Rate Includes Shift Differentials, Incentives, Bonuses & Other Supplemental Comp To Avoid Pricey Overtime Mistakes

March 28, 2023

A $259,474 backpay award the U.S. Department of Labor’s Wage and Hour Division (“WHD”) ordered plastics manufacturer Jadex Inc. and four subsidiaries (“Jadex”) to pay alerts other businesses against improperly failing to include incentives, bonuses and premium pay failed to include incentives, bonuses and premium when calculating and paying overtime under the Fair Labor Standards Act (“FLSA”).

Jadex Overtime Schooling

Jadex Inc., a South Carolina manufacturing holding company that employs approximately 1,800 employees at its headquarters and subsidiaries, Alltrista Plastics LLC, ArtaZn LLC, LifeMade Products LLC, and Shakespeare Co. LLC, is learning an expensive lesson about the FlSA’s requirements to include most shift, differentials, bonuses, or other supplemental compensation in an employee’s base rate of pay when calculating his overtime.

WHD found Jadex underpaid 939 employees by improperly omitting additional pay from the base rate of pay when calculating overtime,

A WHD audit of Jadex found the employers violated the FLSA by failing to include bonuses workers earned by reaching sales and safety goals per quarter, incentives awarded for working night shifts and for serving as trainers to other employees, additional hourly amounts for every hour worked during peak production seasons and bonuses for perfect attendance and personal safety performance during peak seasons.

As a result of the audit, WHD recovered a total $259,474 of overtime for the employees from Jadex.

Precautionary Lesson For Other Businesses

WHD warned other businesses against making similar mistakes when calculating overtime due their workers when announcing its recovery from Jafex. “Employers must understand all applicable rules when it comes to paying workers overtime. This includes adding bonuses and incentive pay when factoring overtime pay. Anything less robs workers of their hard-earned wages,” said Wage and Hour Division District Director Jamie Benefiel in Columbia, South Carolina.

Employers often unknowingly underpay overtime, because they failed to recognize that most bonuses, incentive pay, shift differentials, and other special compensation presumptively generally must be included in the base rate of pay for purposes of calculating overtime due to non exempt employees unless the employer can demonstrate that the extra compensation qualifies under one of the exemptions allowed by the FLSA.

Getting nailed for failing to appropriately, taking account incentive, bonus, shift, differentials, and other supplemental compensation creates a particular hardship for the employer as the employer will unexpectedly before’s to pay 1 1/2 times the budgeted supplemental compensation amount plus interest and penalties for overtime hours worked if it turns out that the compensation is required to be taken in account for overtime purposes.

To avoid these unpleasant consequences, businesses and their leaders should consult with qualified legal counsel to fully understand how supplemental compensation is likely to be treated for purposes of the FLSA, before announcing or paying the supplemental compensation. Pre-armed with a proper understanding of what types of supplemental compensation, the FLSA requires an employer to include in the base rate of pay for overtime calculation purposes empowers the business to more reliably budget for and pay incentive compensation without the risk of an anticipated overtime liability.

More Information

About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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Posted by Cynthia Marcotte Stamer

USICS Pandemic Flexibilities Ended 3/23

March 23, 2023

U.S. Citizenship and Immigration Services flexibilities first announced in March 2020, to address the COVID-19 pandemic generally now are ended.

USCIS previously notified the public on January 24, 2023 it planned to end its COVID-19 pandemic flexibilities on March 23, 2023. Since no events occurred prompting a change of plans, USCIS let the flexibilities end as planned.

The March 23 end of the flexibilities impacts applicants for new or renewing visas, as well as employers whose I –9 compliance is impacted by visas whose processing deadlines were delayed under the flexibilities.

As a result of the flexibilities end, visa holders, and applicants must respond to any notices or requests from USCIS dated after March 23 by the deadlines listed in the notice or request. This includes:

Requests for Evidence;
Continuations to Request Evidence (N-14);
Notices of Intent to Deny;
Notices of Intent to Revoke;
Notices of Intent to Rescind;
Notices of Intent to Terminate regional centers;
Notices of Intent to Withdraw Temporary Protected Status; and
Motions to Reopen an N-400 Pursuant to 8 CFR 335.5, Receipt of Derogatory Information After Grant.

Additionally, an individual wishing to file Form I-290B, Notice of Appeal or Motion, or Form N-336, Request for a Hearing on a Decision in Naturalization Proceedings (Under Section 336 of the INA), regarding a decision dated after March 23, 2023, you must comply with the deadlines in the form instructions.

USCIS retains discretion to provide certain flexibilities on a case-by-case basis upon request, for applicants or petitioners affected by an emergency or unforeseen circumstance, such as natural catastrophes (hurricanes, wildfires, severe weather, etc.), national emergencies (public health emergencies), or severe illness (including COVID). Please see the Immigration Relief in Emergencies or Unforeseen Circumstances webpage for more information about remaining case-by-case flexibilities

As a reminder, the flexibilities regarding reproduced signatures first announced on March 20, 2020, became policy as announced on July 25, 2022.

More Information

About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses on I-9 and other foreign worker and many other workforce, worker compensation, payroll and other tax, wage and hour and other compensation, employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, USICS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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Posted by Cynthia Marcotte Stamer

Providing Or Using PEOs Or Other Outsourced Payroll Services? Review Updated IRS Certified Professional Employer Organization Rules

March 10, 2023

Professional employer organizations (“PEOs”) and other entities performing payroll administration and tax reporting responsibilities for their business clients and employing businesses that use their services should review the updated Internal Revenue Service (“IRS”) requirements to be and remain a Certified Professional Employer Organization (CPEO) under the voluntary CPEO Program the IRS established and administers under the Tax Increase Prevention Act of 2014. Revenue Procedure 2023-18 updates the IRS’ current rules and procedures to become and remain certified as a Certified Professional Employer Organization (CPEO) and the procedures relating to suspension and revocation of CPEO certification.

Voluntarily becoming and remaining certified as a CPEO means that a PEO has met the detailed background, experience, business location, financial reporting, tax compliance, and bonding requirements described in the statute and regulations of the CPEO program.

To be eligible for certification as a CPEO, a PEO:

must be a business entity,
must have at least one physical business location within the United States,
should have a history of financial responsibility, organizational integrity, and tax compliance (federal, state, and local),
and should be managed by individuals (a majority of whom are U.S. citizens or residents) who have knowledge or experience regarding federal and state employment tax compliance and business practices relating to those compliance requirements.

Like its predecessors, Revenue Procedure 2023-18 requires PEOs must meet and comply with detained requirements for becoming and remaining certified as a CPEO and PEOs performing payroll services as a CPEO assume additional tax liability. In addition to the detailed requirements to show suitability to qualify as a CPEO, CPEOs also face annual reporting and other requirements to preserve their certification. PEOS that currently are, or are interested in becoming CPEOs should carefully review these requirements to ensure their ability to meet and comply with the conditions.

Although CPEO certification is voluntary, many PEOs find the burdens of certification helpful if not necessary to meet the expectation of their preferred customers. Many businesses outsourcing payroll and other tax services require or prefer use CPEOs when outsourcing payroll and other tax services because if the CPEO and business agree and the CPEO timely files the required Form 8973, Certified Professional Employer Organization/Customer Reporting Agreement with the IRS at the start of the contract, the CPEO generally becomes solely liable for paying the customer’s employment taxes, filing returns, and making deposits and payments for the taxes reported with regard to remuneration it pays to work site (but not nonwork site) employees under the payroll outsourcing arrangement. The CPEO will file aggregate employment tax returns for all its customers using the CPEO’s employer identification number (EIN) with the appropriate Schedule R, Allocation Schedule for Aggregate Filers attached that allocates to each customer the information reported. The CPEO deposits and pays the tax liabilities of those customers using the CPEO’s EIN, according to the CPEO’s deposit requirements. CPEO customers cannot view federal tax deposits and payments made by the CPEO using the Electronic Federal Tax Payment System (EFTPS). In other words, an appropriate payroll outsourcing arrangement with a CPEO allows the business both to outsource the performance of the functions and much of the liability for the proper performance of those activities to the CPEO. A CPEO and its customer may both be liable with regard to remuneration the CPEO pays to non-worksite employees, however. For additional information on employers outsourcing their payroll responsibilities under the Internal Revenue Code, see Outsourcing Payroll and Third Party Payers.

PEOs apply to become CPEOs using the IRS’ Online Registration System for PEO certification which requires the applying PEO to complete the following:

Revenue Procedure 2023-18 modifies and supersedes both Revenue Procedure 2016-33 and Revenue Procedure 2017-14. It addresses the procedures for applying to be certified as a Certified Professional Employer Organization (CPEO), the requirements for a CPEO to remain certified, and the procedures relating to suspension and revocation of CPEO certification. Revenue Procedure 2023-18 is scheduled for official publication in Internal Revenue Bulletin 2023-13, on March 27, 2023. Its provisions become effective today effective March 10, 2023. CPEOs and PEOs contemplating certification, as well as the businesses outsourcing or considering outsourcing to them should carefully evaluate the updated guidance and its implications on their responsibilities and liabilities. When conducting these evaluations and contracting, all parties should fully understand the implications of the arrangement. Likewise, parties involved in these arrangements also should keep in mind that the Internal Revenue Code characterization of relationships to workers and allocations of responsibility and liability for payroll or other tax obligations do not determine the consequences of their arrangement for most other legal purposes. Rather, the characterization of an outsourcing business and a PEO or other workforce vendor as an employer, joint employer, agent or other responsible party and each party’s potential respective obligations and exposures under Federal or state wage and hour, discrimination, safety, leave, union and other labor and employment laws is governed by the applicable statutes, regulations and rulings. PEOs and businesses using PEO or other outsourcing, staffing, subcontracting or similar arrangements should carefully evaluate the consequences of their proposed arrangements under all relevant laws. For additional information on employers outsourcing their payroll responsibilities, see Outsourcing Payroll and Third Party Payers.

More Information

About the Author

A Fellow in the American College of Employee Benefit Counsel, Vice Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer’s work throughout her 35 year career has focused heavily on working with employer and other staffing and workforce organizations, health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends employers, PEOs, staffing, employee leasing and other businesses about worker compensation, payroll and other tax, wage and hour and other compensation and employee benefit, occupational health and safety, contracting, compliance, risk management and other internal and external controls in a wide range of areas and has published and spoken extensively on these concerns. She also has decades of regulatory and other government affairs experience with these concerns including defending these and other businesses before the IRS, EBSA, WHD, EEOC, OCR, HHS, state labor, insurance, and other authorities, and evaluating and responding to federal, state and local statutory, regulatory and enforcement actions by federal and state legislators and regulators. A prolific author and popular speaker, Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

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Comments Off on Providing Or Using PEOs Or Other Outsourced Payroll Services? Review Updated IRS Certified Professional Employer Organization Rules | Brokers, compensation, compliance, Corporate Compliance, corporate governance, employee, Employee Benefits, Employer, Employers, Employment Tax, Wage & Hour | Permalink
Posted by Cynthia Marcotte Stamer

USCIS Adopts Domestic Mobile Biometrics Collection and Remote Domestic Applicant Biometrics Collection

March 7, 2023

U.S. Department of Homeland Security
U.S. Citizenship and Immigration Services (“USCIS”) issuing policy guidance governing its mobile biometrics collection and the biometrics collection of benefit requestors in remote locations to s to make it more accessible for certain benefit requestors.

USCIS generally requires applicants for visas or other benefits to schedule and keep a biometrics appointment at a local Application Support Center (ASC) after the applicant files an application, petition, or other benefit request. The person submitting biometrics must bring the Form I-797C and valid, unexpired photo identification (for example, Permanent Resident Card (Form I-551), passport, or driver’s license) to the appointment, if required. USCIS considers a person to have abandoned his or her application, petition, or request if he or she fails to appear for the biometrics appointment unless, by the appointment time, USCIS receives a change of address or rescheduling request that it concludes warrants excusing the failure to appear.

Since some applicants face health, logistical or other legitimate challenges to appearing in person, USCIS intends to make biometric collection more accessible for benefit requestors unable to attend appointments at USCIS Application Support Centers (ASC) due to health or other issues, or because their physical location requires multiple modes of transportation or substantial travel times to reach an ASC, where USCIS generally collects biometrics.

To this end, USCIS is amending the USCIS Policy Manual to:

Provide circumstances under which USCIS may conduct mobile biometrics collection for benefit requestors who reside in remote locations in relation to ASCs; and
Provide an alternative method to fingerprint collection, to include fingerprint cards and coordination with other agencies, for certain benefit requestors who live in locations so remote that USCIS mobile biometric services would not be practical.

The availability of remote collection may help employers and their workers seeking visas with restrictions on the workers ability to travel to an on-site collection location. Employers with workers with these challenges should coordinate with the worker and their immigration counsel to ensure they pursue these new opportunities where appropriate.

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Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on workforce, compensation, and other operations, risk management, compliance and regulatory and public affairs concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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Federal Marijuanna Pardons Create Potential Employer Headaches

March 5, 2023

Employers whose policies disqualify applicants from employment based on past Marijuanna convictions need to prepare to respond to applicants presenting certificates of pardon of their prior federal conviction of simple Marijuanna conviction received under President Biden’s October 6, 2023 Presidential Proclamation on Marijuana Possession.

Biden Marijuanna Pardons

The Proclamation provided a blanket pardon for all prior federal and D.C. (but not state) offenses of simple possession of marijuana.

Those who were pardoned on October 6, 2022, are eligible for a certificate of pardon. Consistent with the proclamation, to be eligible for a certificate, an applicant must have been charged or convicted of simple possession of marijuana in either a federal court or D.C. Superior Court, and the applicant must have been lawfully within the United States at the time of the offense. Similarly, an individual must have been a U.S. citizen or lawful permanent resident on October 6, 2022. Those convicted of state marijuana offenses do not qualify for the pardon.

On March 3, 2023, the Justice Department announced the application process for issuing certificates of the pardons to pardoned individuals. This process allows pardoned individuals to get prof of their pardons to present to employers and others. Consequently health care and other businesses should prepare to respond to applicants presenting these certificates.

When he made the pardon proclamation, President Biden directed the Justice Department to develop a process for individuals to receive their certificate of pardon. On March 3, 2023, the Justice Department issued an application for eligible individuals to receive certificate of proof that they were pardoned under the Oct. 6, 2022, proclamation by President Biden.

The online application available on the Office of the Pardon Attorney’s website: Application for Certificate of Pardon allows eligible persons to submit documentation to the Office of the Pardon Attorney and receive a certificate indicating the person was pardoned on October 6, 2022, for simple possession of marijuana.

President Biden said when making his proclamation he intended the pardons to “help relieve the consequences arising from these convictions.” The President’s pardon, effective Oct. 6, 2022, may assist pardoned persons by removing civil or legal disabilities such as restrictions on the right to vote, to hold office or to sit on a jury that are imposed because of the pardoned conviction. Proofs of pardon also may help those pardoned to obtain licenses, bonding or employment.

Potential Employer Challenges

The pardons are likely to create concerns for health care and other employers who currently disqualify applicants from eligibility for employment based on drug related criminal conditions where the employer remains subject to statutory, regulatory, contractual or other requirements prohibiting employment of workers with prior or current history of drug offenses or use.

As a starting point, employers should carefully review their own existing policies as well as any statutory, regulatory contractual requirements applicable to their workforce to assess the implications of the pardons on the employment eligibility of a pardoned worker. Ambiguities are likely to arise under many policies, particularly where a hugyirunof drug use or possession is disqualifying without a requirement of a conviction.

Employers contemplating continuing to disqualify pardoned applicants for safety or other reasons probably should seek the advice of legal counsel. Some pardoned applicants might argue an employer’s reliance on a pardoned criminal drug conviction constitutes prohibited discrimination based on a history of prior drug dependence that violates the Americans With Disabilities Act or other discrimination laws. Statements made by President Biden and others within the Administration suggest the Equal Employmrnt Opportunity omission might support these or similar arguments in furtherance of promotion if President Biden’s policy of facilitating opportunities for employment for individuals recovering from substance abuse.

Employers also may struggle with equity questions raised by the pardoning of federal convicts but not those with state convictions.

Employers should monitor Equal Employment Opportunities Commission and other guidance and seek advice of experienced legal counsel to develop and administer hiring policies to mitigate potential exposures.

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Posted by Cynthia Marcotte Stamer

Affordable Housing Company Nailed For Sexual Harassment

March 3, 2023

Kingston Properties will pay $240,000 to five women to settle a sexual harassment lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC).

Title VII of the Civil Rights Act of 1964 prohibits discrimination based on sex, including subjecting employees a hostile work environment based on sex. The EEOC filed suit in U.S. District Court for the Northern District of New York (EEOC v. Birchez Associates LLC, et al., Civil Action No. 19-cv-8110) after first attempting to reach a pre-litigation settlement through its conciliation process.

According to the EEOC’s lawsuit, Steve Aaron, the former owner and top management official of the affordable housing development company repeatedly subjected female employees to crude sexual comments. He frequently yelled at his female employees and used obscene sexist epithets. The harassment also involved unwelcome physical contact and subjecting a female employee to pornography on a cell phone. Despite repeated objections by female employees, the conduct did not stop, causing several women to resign.

During the lawsuit, a new owner purchased the properties. Under the decree, the new owner will not allow Steve Aaron or the top manager of the prior companies to be involved with their employees or in the management of the buildings.

The lawsuit and settlement are among a waive of employment discrimination lawsuits, settlements and charges the EEOC has announced in recent weeks which warn other employers to ensure their workplaces comply with federal sexual harassment and other employment discrimination laws. Employers covered by these rules are encouraged to take steps to position their organizations to avoid and defend against similar charges or disputes.

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Disability Program Sued For Disability Discrimination

March 3, 2023

The Equal Employment Opportunity Commission (“EEOC”) is suing a nonprofit providing programs for people with disabilities and others to build self-reliance through educational, therapeutic, and employment services for violating the Americans With Disabilities Act (“ADA”) by refusing to accommodate an employee with a degenerative hip impairment and instead fired her.

The ADA prohibits employers from refusing to provide reasonable accommodations to employees or applicants with a disability unless doing so would constitute an undue hardship.

According to the EEOC’s suit filed today (March 3, 2023) against Innovative Services NW (ISNW),Carly Romero earned praise as a valued employee and strong performer by high level managers during the seven years she worked as a janitor in the Innovative Services NW (ISNW), Janitorial Services Program in Vancouver, Washington.

In November 2019, Romero attempted to return to work with a doctor’s release allowing her to resume janitorial activities, except for wearing a backpack vacuum. As a reasonable accommodation, Romero asked to use an upright vacuum instead. The EEOC’s investigation found that even though ISNW had permitted other janitors to use upright vacuums at some customer sites, ISNW refused Romero’s repeated requests to return to work. Claiming “there would be too much risk to return [Romero] to work without a 100% release,” ISNW placed Romero on unpaid leave, then fired her on January 21, 2020.

The EEOC charges these actions by ISNW violated the ADA. “Ms. Romero simply asked to return to work using an upright vacuum, equipment already used by other employees. Instead, ISNW chose to fire her,” said Elizabeth Cannon, director of EEOC’s Seattle Field Office. “Under the ADA, an employer cannot deny an employee with a disability the opportunity to work when there is a readily available accommodation that would allow her to perform her job.”

After attempting to negotiate a settlement failed, the EEOC filed its lawsuit, EEOC v. Innovative Services NW, Civil Number 2:23-CV-00295, in U.S. District Court for the Western District of Washington seeking back pay, compensatory and punitive damages, and injunctive relief designed to prevent similar discrimination in the future. If the EEOC prevails ISNW can expect to be ordered to pay attorneys’s fees as well.

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Posted by Cynthia Marcotte Stamer

Medical Clinic Co-Founder Sentencing & New Charges Filed Against Substance Abuse Clinic Operator Highlight Threat Health Plans Face From Health Plan Fraud Scammers

March 3, 2023

The U.S. District Court for the Western District of Kentucky ordered the co-founder of a that Yesdel Acosta Perez to time served of 14 months in prison and to pay $258,507 in restitution for his role in causing health care clinics he cofounded to bill 15 self-funded health plans for $4.7 million in medical services never provided. The conviction reminds health plans, health care providers and others that fraudulently billing self-insured or other private health plans can result in criminal conviction punishable as felony under multiple provisions of the United States Criminal Code. Acosta Perez’ sentencing coincides with the Justice Department’s announcement of its March 2, 2023 filing of similar criminal charges against the operator of a chain of substance abuse clinics and others for their alleged involvement in millions of dollars of false charges billed to private health plans, Medicare and Medicaid for substance abuse addition treatment not provided.

The conviction and sentencing of Acosta Perez and the newly announced charges against operators of a chain of addiction treatment clinics in Massachusetts and Rhode Island and others for alleged ahealth care fraud aggravated identity theft, money laundering and obstruction in relation to alleged billing of millions of dollars of false charges to private health plans, Medicare and Medicaid for substance abuse treatment by clinics highlight the continuing threat fraudulent actors present for self-insured and other private health plans, Medicare and Medicaid, as well as the potential criminal prosecution and consequences those individuals convicted of these crimes risk from their criminal activity.

Acosta Perez Conviction & Sentencing

The co-founder of Romero Rehabilitation Physical Therapy Inc. and Empire USA Inc. in Louisville and Imaging Group Center Inc. in Atlanta plead guilty to one count of conspiracy to commit healthcare fraud in February, 2023, after the U.S. Department of Labor found the operators collected $258,000 from 15 self-funded healthcare benefit programs for services they never provided based on fraudulent claims made between 2016 and 2018.

In June, 2018, a federal grand jury indicted Acosta Perez and fellow co-founder Eduardo Chinea-Martinez and others on multiple counts of Health Care Fraud in violation of 18 U.S.C. §1347, Theft from a Health Care Benefit Program in violation of 18 U.S.C. §669, Aggravated Identity Theft in violation of 18 U.S 8 U.S.C. §1028A, Money Laundering in violation of 18 U,S,C. §1956, Mail Fraud in violation of 18 U.S.C Chapter 63 and aiding and abetting in the commission of these violations under 18 U.S.C. §1349. billing various healthcare benefit programs through claims administrators Humana, CIGNA and United Healthcare for $4.7 million for services never provided. The U.S. Criminal Code authorized potential sentences of between 10 to 20 years of imprisonment as well as subjected charged defendants to asset forfeiture upon conviction.

The grand jury inditement and subsequent prosecution of Acosta Perz and a fellow co-founder resulted from an Employee Benefit Security Benefit Administration investigation that found that, between May 2015 and January 2016, Acosta Perez and Eduardo Chinea-Martinez co-founded three companies to intentionally defraud various healthcare benefit programs. Investigators also determined Acosta Perez opened bank accounts for the fictitious businesses at JPMorgan Chase Bank, Wells Fargo Bank and Bank of America. Acosta Perez and Chinea-Martinez. The indictment charges that Acosta Perez and Chinea-Martinez misappropriated and used patients’ names, dates of birth, insurance/policy numbers, addresses, and patient IDs/Social Security Numbers, without the patients’ knowledge and names and National Provider Numbers (“NPIs”) from uninvolved doctors without the doctors’ knowledge to create claims for payment by representing these uninvolved doctors and clinics allegedly ordered or performed the services in the false and fraudulent billings submitted by defendants for payment to submit fraudulent claims. The fraudulent claims directed the plans to send payment for the billed services to a Regus virtual office location in Louisville, Kentucky. Acosta Perez then directed Regus via email to forward all mail to Romero Rehabilitation Physical Therapy. According to the indictment, using this process to submit claims for payment for the fraudulent services, Chinea-Martinez and Acosta Perez billed approximately $4,700,000 in fraudulent medical services to the self-insured plans and received payment for $258,000.

In March 2020, the court sentenced Chinea-Martinez to 42 months in prison and three years of supervised release for his part in the scheme. However, before his in June 2018, Acosta Perez fled the U.S. On July 22, 2022, however, the Italian government granted the request of the U.S. for the extradition of Acosta Perez and surrendered him to U.S. authorities. Acosta-Perez was arrested in June 2022.

New Health Care Fraud Charges Against Rhode Island and Massachusetts Addiction Treatment Chain Operators

Acosta-Perez’s sentencing coincides with the Justice Department’s March 2, 2023 announcement of its filing of a host of similar charges in Rhode Island against the operator of a chain of addiction treatment clinics and others for alleged aggravated identity theft, money laundering and obstruction in relation to theft of the identities and other patient and provider information and using their information to file false charges billed to private health plans, Medicare and Medicaid for substance abuse treatment by clinics.

Michael Brier, Mi Ok Bruining and Recovery Connections Centers of America, Inc. (RCCA) are charged in a federal criminal complaint with health care fraud and Michael Brier also is charged with aggravated identity theft, money laundering and obstruction. In addition, the treatment center and its former supervisory counselor were also charged with health care fraud. The Justice Department announcement of these charges reminds readers that its federal criminal complaint is merely an accusation and that the defendants are presumed innocent unless and until proven guilty.

The Justice Department alleges in court documents that, Brier, Bruining, and RCCA shortchanged Rhode Island and Massachusetts substance abuse disorder patients out of much needed counseling and treatment services, while defrauding Medicare, Medicaid, and other health insurers out of millions of dollars.

According to the charging documents, Brier, Bruining and RCCA operated a chain of addiction treatment centers but failed to provide the patients with the required counseling sessions and treatment, while simultaneous billing Medicare, Medicaid and other health care payors for 45-minute counseling sessions on a routine basis even though the sessions were not more than 15 minutes, and often only 5-10 minutes or less. At times, so many counseling sessions were billed at this level that the total amount of time would be impossible for the available therapist to have provided in any 24 hours period.

Brier and RCCA are also alleged to have caused a fraudulent application to be submitted to Medicare which, among other things, misrepresented and concealed the role that Brier was playing in the business and failed to disclose Brier’s 2013 criminal conviction for federal tax crimes, which was relevant to Medicare’s consideration of the application.

The Complaint also alleges that Brier purported to practice medicine and wrote and caused to be filled fraudulent prescriptions using the names and prescriber information, including Drug Enforcement Administration numbers, of doctors without their permission.

Brier is also alleged to have falsified a document in a matter within the jurisdiction of an agency of the United States by causing the Medical Director to sign a false and back-dated document.

The complaint alleges that defendants caused millions of dollars in fraudulent billings to be submitted to Medicare and millions more in fraudulent billings to other health care payors. The government is also seeking to forfeit thirteen bank accounts, two buildings, and two vehicles allegedly realized by the defendants as a result of the alleged criminal conduct.

The two prosecutions highlight the continuing challenge health plans and other health care payers face from fraudulent claims submitted by criminal actors intent on deliberately defrauding health plans through schemes to knowingly defraud plans by creating and filing false claims. Health plans and their fiduciaries and administrators should be vigilant in their efforts to identify and protect their health benefit programs against these schemes and if victimized or presented with evidence of these schemes, should work with experienced legal counsel to prudently investigate these concerns and report relevant findings to the EBSA, the Department of Justice Health Care Fraud Task Force or both.

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Court Order Shows What Not To Do When Facing A FLSA Or Other DOL Investigation

March 2, 2023

A federal court order against a Brewster home care provider shows some key things an employer should not do when facing a Department of Labor Wage and Hour Division Fair Labor Standards Act (“FLSA”) or other Labor Department investigation. With Labor Department wage and hour and other employment and labor law enforcement soaring under the Biden Administration’s pro-employee agenda, all employers should learn from the schooling this and other noncompliant employers are receiving from the Labor Department and courts.

Sunrise Home Health Care, Inc. & Owner Injunction For FLSA Investigation interference & Retaliation

The Labor Department obtained a temporary restraining order in the U.S. District Court for the Southern District of New York on March 1, 2023 ordering Sunrise Home Care Inc. and owner Elsa Silva to stop retaliating against employees in an effort to obstruct the wage and Hour Division’s FLSA investigation.

According to the Labor Department complaint, when the Wage and Hour Division began an investigation to evaluate the employers’ compliance with the FLSA in January 2023, Silva has harassed and intimidated employees repeatedly by

Asking workers about their communications with investigators;
instructing workers to provide false information;
Telling employees she would have to close the business and they would lose their jobs if the investigation determined she had to pay overtime premiums; and
Pressuring employees to agree to return to the employers any monies owed to employees as a result of the investigation.

The court order secured by the Labor Department forbids Silva and Sunrise Home Care Inc. from doing the following:

Violating the FLSA’s anti-retaliation provisions.
Threatening employees with termination or other retaliatory actions or taking any other actions to prevent them from participating in the Department’s investigation or in any other FLSA-protected activity.
Obstructing and interfering, in any way, with the investigation.
Telling workers not to cooperate with investigators or to provide incomplete or false information to them.
Questioning employees about their cooperation or communications with investigators.
Advising current and former employees that they must “kickback” or return any back wages the department may determine they are owed.
Communicating with any employee regarding the investigation without first informing the employee that they may communicate with investigators voluntarily and not be discriminated against for doing so.

The court order secured by the Labor Department also orders Silva and Sunrise Home Care Inc. to:

Permit division representatives to read aloud – in English, Spanish, Portuguese and any other language understood by most employees – a statement describing employees’ FLSA rights during their paid working hours and in the presence of the defendants.
Mail a written statement of the same to current and former employees.
Provide a written notice to the Wage and Hour Division at least seven days before terminating an employee for any reason.

The injunctive relief issued by the Court seeks to allows the Labor Department investigation to continue without further employer obstruction. Aside from any contempt sanctions Sunrise and Silva could incur for violating the court’s order, the alleged threats and retaliation also could serve as a basis for the assessment of additional liability as a sanction for the employee’s prohibited retaliation beyond any backpay and penalty awards the Labor Department finds the employer owes for failing to pay wages or keep records.

FLSA Liability Risks High; Learn From Other Employer’s Mistakes

Other employees and their management should learn from the schooling the court ordered against Sunrise and Silva and avoid engaging in the actions prohibited by the court order when facing their own FLSA or other Labor Department investigation.

The Labor Department views audit, investigation and enforcement of the FLSA compliance and violations a key priority and employers risk significant liability for violations from Wage and Hour Division or private enforcement.

Enforcement by the Labor Department and private litigants of minimum wage, overtime, child labor, human trafficking and other laws is increasingly common. the Labor Department Wage and Hour Division concludes approximately 21,000 Fair Labor Standards Act cases, impacting over 200,000 workers each year. Over the last five years, Wage and Hour has collected more than $1 billion in back wages for workers in America. But the Department of Labor recognizes that back wages alone provide insufficient compensation to employees for lost wages. Although actual enforcement dipped slightly over the past two years due to the disruption in the Wage and Hour Division’s staffing and operation during the COVID-19 health care emergency, its announcement of a stream of FLSA enforcement actions reflects it is resuming its zealous enforcement. See WHD FLSA and Other Statistics. Therefore, liquidated damages are intended to compensate workers for damages they may have incurred as the result of not having been paid timely for all the wages they legally earned.

Employers found in violation of these rules enforcement actions face actual damages, interest, civil monetary penalties, enforcement costs, and in the case of willful violations, even potential criminal sanctions. While the Labor Department during the Trump Presidency suspended its pursuit of collection of liquidated damages authorized under the FLSA Generous recoveries also make private enforcement very attractive to employees and plaintiffs’ counsel, this leniency ended after President Biden took office. Since April 9, 2021, Labor Department wage and hour law enforcement policy includes pursuing the implementation and collection of liquidated damages in addition to back pay and interest due for unpaid wages from employers found in violation of the FLSA and other wage and hour laws. Private litigants can recover actual damages plus double damages, interest, attorneys’ fees and other costs of enforcement. The availability of these extraordinary damages and recoveries makes these highly popular cases to many plaintiffs’ attorneys.

As demonstrated by the Exxon injunction, employers facing wage and hour investigations, audits or even employee inquiries or underpayment assertions other should keep in mind that actions by the employer that could be viewed as interference with an investigation by the Labor Department as well as improperly handled employee questions or statements of concern about potential FLSA and other related requirements can create retaliation or whistleblower risks. Accordingly, employers should use care to investigate and respond carefully to these concerns, addressing workers during the conduct of a Labor Department audit, investigation or enforcement action and in handling subsequent discipline or other employment decisions involving workers raising them.

Along with FLSA claims, these violations also can trigger state wage an hour, payday act and other liabilities.

Many businesses experience difficulties defending wage and hour and other FLSA claims due to lax timekeeping and recordkeeping practices, misclassification of workers as contract labor or exempt, failure to include nondiscretionary bonus or other required compensation or hours of work when calculating overtime liability and other common mistakes.

Businesses also should use care to manage their potential exposure to joint employer or other liability for unpaid wages, overtime or other FLSA violations committed by subcontractors, contract labor companies, staffing or other businesses providing workers. Businesses can face imputed liability for violations committed by these other organizations when the facts and circumstances show the business exercises sufficient control over the details of the details of the worker’s work to qualify as a common law employer, whether the relationship between the business and the provider of worker qualifies as a “joint employment” relationship under the rules applicable to FLSA and National Labor Relations Act determinations for joint employment or certain other situations. he Wage and Hour Division also has propose adoption of a regulation to govern classification of workers as employees versus independent contractors for purposes of the FLSA, which if adopted, would heighten the likelihood that many workers considered contractors by businesses could be reclassified by the Labor Department as employees for FLSA and other wage and hour law purposes. The comment period for that regulation closed in December, 2022. Government contractors and subcontractors also may bear responsibility for contracting with subcontractors and taking other steps to ensure that these subcontracting entities comply with government contract wage requirements and the FLSA.

Misunderstandings about when workers are classified as employees versus contractors, exempt versus non-exempt, and regarding the appropriate tracking, counting, and reporting of hours work increasingly play a major role in aiding Labor Department or plaintiff’s successful enforcement and increase employer liability. Many employers failure to appreciate the significance of statutory presumptions of the existence of an employment relationship and of non-exempt status on the burden of proof the employer must meet to defend its treatment of a worker as a nonemployee or exempt employee. Many employers also fail to recognize the significance of special FLSA rules for characterization of workers as employees, the risk of reclassification of workers the employer considers as contractors or through staffing, day labor or other labor subcontractors as their employees or joint employees. Equally common are misconceptions about the narrowness of the rules for treating employees as exempt and eligible for payment on a salary rather than hourly basis. These mistakes also create a heightened risk that the employer will failed to track necessary Information to defend against employee or Labor Department hours of work claims, overtime or minimum wage claim as well as fuel additional liability for failing to comply with FLSA rules for tracking reporting of hours work. These misperceptions also often lead misinformed employers to take actions that provide a basis for retaliation claims. The Labor Department and private litigant leverage these mistakes to achieve their recoveries.

Because these audits often uncover violations or lead to sensitive conversations about the classification and payment of workers under the FLSA and other laws, employers and their leaders generally should arrange for this analysis to be conducted within the scope of attorney client privilege under the direction of a lawyer experienced in FLSA and other employment law compliance.

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Posted by Cynthia Marcotte Stamer

EEOC Exxon Mobile Race Suit Based On Nooses Hung In Workplace

March 2, 2023

Exxon Mobil Corporation (“Exxon” faces a Equal Employment Opportunity Commission lawsuit charging Exxon violated federal law prohibiting racial harassment in its workplace by failing to take effective measures to prevent the display of hangman’s nooses at its Baton Rouge complex.

Racial Harassment Violates Title VII

Racially harassing conduct that alters the terms and conditions of the workplace violates the prohibition against discrimination on the basis of race of Title VII of the Civil Rights Act of 1964. Even isolated displays of racially threatening symbols can risk violation of this race discrimination prohibition. When employers become aware of racially offensive or threatening conduct in the workplace, they have a legal obligation to take prompt, remedial action aimed at stopping it.

Exxon’s Alleged Race Discrimination

According to the EEOC’s complaint filed in Louisiana on March 2, 2023, a Black employee at ExxonMobil’s chemical plant found a hangman’s noose at his worksite in January 2020. When the employee reported the noose, the complaint clains ExxonMobil knew three other nooses had been displayed at the Baton Rouge complex.

After the employee reported the noose in January, a fifth noose was reported in December 2020 at the complex.

The EEOC alleges that ExxonMobil investigated some, but not all, of the prior incidents and failed to take measures reasonably calculated to end the harassment.

Elizabeth Owen, a senior trial attorney in the EEOC’s New Orleans Field Office, explained, “A noose is a longstanding symbol of violence associated with the lynching of African Americans. Such symbols are inherently threatening and significantly alter the workplace environment for Black Americans.”

EEOC charges Exxon’s actions and omissions regarding the noose incidents created a racially hostile work environment.

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Updated Form 5500s and Instructions Released

February 24, 2023

The U.S. Department of Labor Employee Benefits Security Administration, the Internal Revenue Service (“IRS”) and the Pension Benefit Guaranty Corporation (“PBGC”) announcing changes to the 2023 Form 5500 Annual Return/Report of Employee Benefit Plan and Form 5500-SF Short Form in February 23.

The “Phase III” announcement released this week are set forth in the following:

Notice of Final Form Revisions, available at https://www.federalregister.gov/documents/2023/02/24/2023-02653/annual-information-returnreports
Notice of Final Rulemaking, available at https://www.federalregister.gov/documents/2023/02/24/2023-02652/annual-reporting-and-disclosure
Fact Sheet, available at https://www.dol.gov/agencies/EBSA/about-ebsa/our-activities/resource-center/fact-sheets/changes-for-the-2023-form-5500-and-form-5500-sf-annual-return-reports

The Phase III announcement implements the third and final phase of implementation of a September, 2021 regulatory proposal, which included changes related to provisions in the Setting Every Community Up for Retirement Enforcement Act, commonly known as the SECURE Act, which affected annual reporting requirements under the Employee Retirement Income Security Act and the Internal Revenue Code.

The first two phases of implementation included publication of Federal Register notices in December 2021 for Phase I and May 2022 for Phase II, respectively, to adopt changes for the 2021 and 2022 Form 5500 Returns/Reports.

The Phase III announcement features a Notice of Final Forms Revisions from the EBSA, IRS and PBGC for the 2023 plan year forms and instructions and a Notice of Final Rulemaking by the department that makes corresponding changes to annual reporting regulations under Title I of ERISA.

The 2023 plan year reports – which generally will be filed beginning in July 2024 for calendar year plans – include the following changes:

A consolidated Form 5500 reporting option for certain groups of defined contribution retirement plans, improved reporting by pooled employer plans and other multiple employer plans.
A change in the participant-counting methodology for determining eligibility for simplified reporting alternatives available to “small plans,” which are generally plans with fewer than 100 participants.
A breakout of reporting on administrative expenses paid by the plan on the plan’s financial statements.
Further improvements in financial and funding reporting by PBGC-covered defined benefit plans.
The addition of selected Internal Revenue Code compliance questions to improve tax oversight and compliance of tax-qualified retirement plans.
Technical and conforming changes as part of the annual rollover of forms and instructions.

Additionally, technical adjustments were made to the Federal Register notices to address certain provisions in SECURE Act 2.0 of 2022 on Code section 403(b) multiple employer plans, including pooled employer plans, minimum required distributions and audit requirements for plans in defined contribution group reporting arrangements.

The Federal Register notices, Document #2023-02653 for the Notice of Final Forms Revision and Document #2023-02652 for Notice of Final Rulemaking, also include appendices that describe the changes to the forms and instructions as well as a regulatory impact and paperwork burden analyses. A more detailed summary of the annual reporting changes is included in a fact sheet posted on the department’s website today. Mock-ups of the forms and instructions will be available at reginfo.gov as part of the Paperwork Reduction Act clearance process. The release of “for information-only” copies of the forms and instructions will happen later in 2023.

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When investigating and responding to a violation, it is critically important to document the timing and details of the discovery of a potentially concern

About the Author

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

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Posted by Cynthia Marcotte Stamer

Update Compliance Programs To Meet DOJ New Voluntary Compliance Disclosure Policy Requirements

February 24, 2023

Organizations and their leaders risk, federal criminal liability from violations of an ever-growing multitude of federal tax, securities, cyber liability, labor and employment, safety, environmental and other laws.

As part of these efforts, leaders now need to consider advisability of enhancements or other modifications of their organization’s Federal Sentencing Guideline and other compliance programs and practices in light of the new corporate criminal conduct Voluntary Self-Disclosure Policy (“VSD policy”) announced by the Department of Justice on February 23, 2023. Concurrently, organizations and their leaders also will want to monitor and respond promptly to Justice Department statements and congressional recommendations on proposed Guideline changes providing critical insights into the Justice Department’s planned interpretation and enforcement of federal criminal laws and the Guidelines against organizations and their leaders like those available here.

While the application of the VSP policy inherently requires subjective decision-making, the VSP policy and other emerging statements reenforces to organizations and their leaders the advisability of ensuring their organizations adopt and administer effective Federal Sentencing Guideline compliance programs for the ever-growing list of laws applicable to their organizations that carry potential felony and class A misdemeanor criminal liability and timely to investigate and self-disclose violations with the assistance of legal counsel in accordance with the Guideline requirements for liability mitigation to mitigate the potential liability exposure of the organization and its leader.

VSD Policy Standardizes USAO Sentencing Guideline Organization Liability Determinations

Chapter 8 of the Federal Sentencing Guidelines sets standards for assessment of criminal liability and punishment against corporations, partnerships, labor unions, pension funds, trusts, non-profit entities, and governmental unit (“organizations”) and their leaders for legal violations committed by the organization that carry felony or Class A misdemeanor liability or when the Federal Sentencing Guidelines impute criminal liability to the organization for criminal acts that an employee of the organization commits an act within the apparent scope of his employment.

The standards for organizational sentencing offer organizations the opportunity to mitigate their liability exposure if it can persuade the prosecuting U.S. attorneys office (“USAO”) it had in place and followed an effective compliance program, promptly reported the violation to the authorities, and that high level were not involved in the actual offense conduct. On the other hand, an organization the organization’s lack of an effective compliance program, delay in investigation, cover-up or failure or delay or timely disclose and make restitution for violations are aggravating factors that can increase its potential sanction.

According to the Justice Department, the Justice Department intends that the VSD policy ensure that organizations can rely on receiving the same treatment and benefits for voluntarily self-disclosing criminal conduct under the Federal Sentencing Guidelines organizational liability rules to any USAO no matter where the organization operates by setting “a nationwide standard” for how USAOs will determine whether an organization has made a voluntary self-disclosure and making transparent the specific, tangible benefits to an organization that the USAO will offer the organization for making a voluntary self-disclosure, fully cooperating, and remediating the criminal conduct.

In furtherance of this goal, the new VSD policy provides that a USAG will consider an organization to have made a VSD for purposes of the Federal Sentencing Guidelines if it becomes aware of misconduct by employees or agents before that misconduct is publicly reported or otherwise known to the DOJ, and discloses all relevant facts known to the company about the misconduct to USAO in a timely fashion before an imminent threat of disclosure or government investigation.

In the absence of any aggravating factor, the VSD policy calls for the USAG “significant benefits” to a corporation that voluntarily self-discloses criminal conduct committed by its employee or agent in accordance with the VSD policy, fully meets the other requirements of the VSD policy, fully cooperates and timely and appropriately remediates the criminal conduct including agreeing to pay all disgorgement, forfeiture, and restitution resulting from the misconduct. The promised significant benefits for organizations making a qualifying VSD include that the USAO:

Will not seek a guilty plea;
May choose not to impose any criminal penalty and in any event will not impose a criminal penalty that is greater than 50% below the low end of the United States Sentencing Guidelines (USSG) fine range; and
Will not seek the imposition of an independent compliance monitor if the company demonstrates that it has implemented and tested an effective compliance program.

The VSD policy identifies three aggravating factors that could warrant a USAO seeking a guilty plea even if the other requirements of the VSD policy are met:

If the misconduct poses a grave threat to national security, public health, or the environment;
If the misconduct is deeply pervasive throughout the company; or
If the misconduct involved current executive management of the company.

The Justice Department says the presence of an aggravating factor does not necessarily mean that a guilty plea will be required. Rather, the USAO will assess the relevant facts and circumstances to determine the appropriate resolution. If a guilty plea is ultimately required, the Justice Department says the organization will still receive the other benefits under the VSD policy, including that the USAO will recommend a criminal penalty of at least a 50% and up to a 75% reduction off the low end of the USSG fine range, and that the USAO will not require the appointment of a monitor if the company has implemented and tested an effective compliance program.

In cases where a company is being jointly prosecuted by a USAO and another DOJ component, or where the misconduct reported by the company falls within the scope of conduct covered by VSD policies administered by other DOJ components, the USAO will coordinate with, or, if necessary, obtain approval from, the DOJ component responsible for the VSD policy specific to the reported misconduct when considering a potential resolution. Consistent with relevant provisions of the Justice Manual and as allowable under alternate VSD policies, the USAO may choose to apply any provision of an alternate VSD policy in addition to, or in place of, any provision of its policy.

VSD Policy Reenforces Necessity of Effective Compliance Program & Guideline Compliance

The stated goal of the VSD policy to incentivize companies to maintain effective compliance programs capable of identifying misconduct, expeditiously and voluntarily disclose and remediate misconduct, and cooperate fully with the government in corporate criminal investigations sends a strong message to organizations and their leaders to maintain and administer effective compliance programs and follow the VSD policy promptly when issues arise.

While the Justice Department touts the benefits of compliance with the VSD policy, its adoption also carries an implicit warning to organizations against failing to comply with its provisions.

With the Biden Administration accelerating enforcement of a wide range of federal laws carrying criminal liability, organizations and their leaders should heed this warning by auditing and enhancing their and their organization’s potential criminal exposures and the adequacy of their compliance policies, practices and documentation.

Because of the highly sensitive nature Campus of this type of analysis for the organization and its leaders, before starting the review, and throughout its conduct organizations are urged to engage and seek guidance from qualified legal counsel to position their review for protection, within the scope of attorney, client privilege, and other evidentiary protections, as well as to maximize the benefit of the effort undertaken in the event of future investigations or enforcement.

Possessing an up-to-date understanding of legal obligations, caring, criminal liability exposure is absolutely critical to the effectiveness of this review. With laws and regulations constantly changing, and organizations, and their leaders must start by ensuring their organizations’ processes for monitoring and identifying laws, carrying potential criminal liability, exposure or otherwise, requiring corporate compliance programs are robust and up to date.

When implementing compliance procedures, for any specific law, organizations, and their leaders will also want to ensure that their processes and policies are designed to meet the seven criterial that Chapter 8 of the Federal Sentencing Guidelines outlines for establishing an “effective compliance program”

The maintenance and enforcement of compliance standards and procedures reasonably capable of reducing the prospect of criminal activity;
Oversight by high-level personnel;
Due care in delegating substantial discretionary authority;
Effective Communication to all levels of employees;
Reasonable steps to achieve compliance, which include systems for monitoring, auditing, and reporting suspected wrongdoing without fear of reprisal.
Consistent enforcement of compliance standards including disciplinary mechanisms; and
Reasonable steps to respond to and prevent further similar offenses upon detection of a violation.

Taking into account these criteria and the new VSP policy, organizations and their leaders also should ensure their organization has appropriate procedures and protocols for receiving, investigating and reports of potential violations and the organization’s timely and appropriate response in a manner that best positions the organization to demonstrate the culture of compliance, and other factors necessary to qualify for the maximum leniency under the guidelines. in a manner that best positions the organization to demonstrate the culture of compliance, and other factors necessary to qualify for the maximum leniency under the guidelines.

When designing and administering compliance investigations and responses, documentation and other evidence regarding actions taken, communications and deliberations, play a key role in deciding how the organization and its leaders will be treated under the VCD policy and the guidelines. For this reason, organization should include appropriate procedures to determine when and how legal counsel will become involved to guide the process and allow for the use of attorney client privilege to help protect, sensitive discussions along the way. Legal counsel also should assist in documenting the process and findings for presentation to the Justice Department and subsequent communications with it through resolution.

More Information

When investigating and responding to a violation, it is critically important to document the timing and details of the discovery of a potentially concern

About the Author

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

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Posted by Cynthia Marcotte Stamer

ICE Clarifies F-1 Visa Emergent Relief Period

February 22, 2023

The U.S. Citizenship and Immigration Services (“ICE”) issued policy guidance clarifying the validity period of employment authorization for F-1 nonimmigrant students experiencing severe economic hardship due to emergent circumstances (also known as special student relief (SSR)) who are work authorized under the SSR provisions of 8 CFR. Business leaders should note the update both to recognize the students’ expanded eligibility to work to avoid improper discrimination against foreign student applicants and as prospects for worker hires.

The policy update to the USCIS Policy Manual clarifies that in cases of severe economic hardship due to emergent circumstances, ICE may grant off-campus SSR employment authorization to an F-1 nonimmigrant student for the duration of the Federal Register notice validity period, which is typically 18-months. However this employment authorization may not extend past the student’s academic program end date..

Emergent circumstances are events that affect F-1 nonimmigrant students from a particular region and create severe economic hardship. These events may include, but are not limited to, natural disasters, financial crises, and military conflicts.

This policy update will be effective when published and will apply to all pending and future applications for SSR employment authorization.

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We hope this update is helpful. For more information about the these or other workforce or other legal, management or public policy developments, please contact the author Cynthia Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.

About the Author

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

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Posted by Cynthia Marcotte Stamer

$1.5 Million Penalty Warns Other Businesses Against Child Labor Law Violations

February 19, 2023

The record setting $1.5 million in civil money penalties Packers Sanitation Services Inc. paid for illegally employing minors to perform hazardous duties in violation of the Fair Labor Standards Act (“FLSA”) reminds other employers of their potential exposure for violating child labor laws.

Federal Child Labor Laws

The FLSA establishes minimum wage, overtime pay, recordkeeping, and child labor rules affecting full- and part-time workers in the private sector and in the Federal, state and local governments that vary depending upon the age of the young worker and his or her occupation. In addition to these federal rules, states also generally impose their own child labor regulations. Businesses generally must comply with both.

As part of the federal rules, the FLSA both restricts hours of work for workers less than 18 years of age based on the age of the worker and generally prohibits employment of workers less than 18 years of age in nonagricultural occupations that the DOL finds and declares in a hazardous occupation order (“HO”) as particularly hazardous for 16- and 17-year-old minors, or detrimental to their health or well-being. In addition, Child Labor Regulation No. 3 also bans 14- and 15-year-olds from performing any work proscribed by the HOs. These currently include a HO that generally prohibits child worker employment in occupations involving operation or cleaning of power driven meat-processing machines, slaughtering and meat packing plants or employment in 16 other HOs.

Packers $1.5 Million Penalty

Packers’ payment of the $1.5 million civil money penalties resulted from an U.S. Department of Labor’s Wage and Hour Division (“DOL”) investigation of Packers Sanitation Services Inc. LTD, for violating the FLSA child labor rules.

The DOL imposed the civil penalties after finding the company employed at least 102 children from 13 to 17 years of age in hazardous occupations and had them working overnight shifts at 13 meat processing facilities in eight states.

The division began the Packers Sanitation Services Inc. investigation in August 2022 based on evidence that the company that provides cleaning services under contract to some of the nation’s largest meat and poultry producers employed at least 31 children from 13 to 17 years of age in hazardous occupations to clean dangerous powered equipment during overnight shifts at JBS USA plants in Grand Island, Nebraska, and Worthington, Minnesota, and at Turkey Valley Farms in Marshall, Minnesota. Subsequent investigations found similar violations in Arkansas, Colorado, Indiana, Kansas, Minnesota, Bebraska and Texas.

“Our investigation found Packers Sanitation Services’ systems flagged some young workers as minors, but the company ignored the flags. When the Wage and Hour Division arrived with warrants, the adults – who had recruited, hired and supervised these children – tried to derail our efforts to investigate their employment practices,” said Wage and Hour Regional Administrator Michael Lazzeri in Chicago.

DOL assessed Packers $15,138 for each minor-aged employee who was employed in violation of the law. The amount is the maximum civil money penalty allowed by federal law.

When the Solicitor’s Office filed a complaint in the U.S. District Court November 9, 2022, U.S. District Court Judge John M. Gerrard responded by issuing a temporary restraining order on November 10, 2022, forbidding the company and its employees from committing child labor violations.

On December 6, 2022, the U.S. District Court of Nebraska entered a consent order and judgment, in which Packers agreed to comply with the FLSA’s child labor provisions in all of its operations nationwide, and to take significant steps to ensure future compliance with the law, including employing an outside compliance specialist.

On February 16, 2023, PSSI paid $1.5 million in civil money penalties.

The DOL announcement of the penalty warns other businesses against violating the child labor laws. “The Department of Labor has made it absolutely clear that violations of child labor laws will not be tolerated,” said Solicitor of Labor Seema Nanda. “No child should ever be subject to the conditions found in this investigation. The courts have upheld the department’s rightful authority to execute federal court-approved search warrants and compelled this employer to change their hiring practices to ensure compliance with the law. Let this case be a powerful reminder that all workers in the United States are entitled to the protections of the Fair Labor Standards Act and that an employer who violates wage laws will be held accountable.”

In light of this warning, other businesss should ensure their operations are not improperly using child labor.

More Information

About the Author

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

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Posted by Cynthia Marcotte Stamer

OSHA Gains Power To Get Visas For Certain Non-Citizen Crime Witnesses

February 15, 2023

Beginning March 30, 2023, the Occupational Health and Safety Administration (OSHA) criminal investigation and enforcement will be beefed up by a new authority to issue certifications to provide U Nonimmigrant Status and T Nonimmigrant Status visas to noncitizens to remain in the U.S. to assist in OSHA investigations without fear of deportation or other retaliation.

“U Visas” and “T Visas” allow non-citizen victims of specific crimes to help law enforcement detect, investigate and prosecute crimes without fear of retaliation based on their immigration status by providing them immigration status that allows them to remain in the U.S. to assist authorities in combatting human trafficking and other crimes.

Secretary of Labor Marty Walsh joined Assistant OSHA Secretary Doug Parker to sign a memorandum granting OSHA authority to issue these certifications on February 13. The memorandum for the first time gives OSHA the ability o issue these visa certifications during its workplace safety investigations when the agency identifies manslaughter, trafficking, extortion, felonious assault, forced labor, obstruction of justice or other qualifying criminal violations.

OSHA hopes this new authority will strengthen its ability to secure cooperation of witnesses with immigration status or other social and cultural inequities that discourage them from sharing information with investigators or reporting workplace safety and health issues.

The new authority could enhance OSHA’s ability to investigate and prosecute criminal occupational health and safety and a wide range of other federal laws where non-citizen employees or other noncitizens are victims or witnesses. This new authority could significantly affect criminal conviction risks for businesses using other noncitizen labor as employees.

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About the Author

Ms. Stamer also is widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on health, health plan and managed care industry, workplace safer and occupational health, public health and safety, and other health care operations, risk management, compliance and regulatory and public affairs.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

Comments Off on OSHA Gains Power To Get Visas For Certain Non-Citizen Crime Witnesses | Child Labor, Child Safety, citizenship, Corporate Compliance, corporate governance, Discrimination, E-Verify, Employers, Employment, Employment Discrimination, Employment Termination, enforcement, English As A Second Language, Fair Labor Standards Act, FLSA, Government Contractors, government employer, Human Resources, I-9, Immigration, Internal Controls, Internal Investigations, Joint Employer, national origin, Non-Exempt, Nonresident aliens, occupational safety, Prevailing Wage, tpa, Whistleblower, Worker, Worker Classification, Workers' Compensation, Workforce, workplace violence | Permalink
Posted by Cynthia Marcotte Stamer

$1.25 Million Cybersecurity Breach Settlement & Other Heightening Enforcement Warn Health Plans & Others To Fix Cybersecurity

February 4, 2023

Phoenix-based nonprofit health system Banner Health and its affiliates (“Banner Health”) paid $1.25 million and agreed to take corrective actions to resolve its exposure to potentially much greater Health Insurance Portability and Accountability Act (HIPAA) Security Rule civil monetary penalty exposure for a 2016 cyber hacking breach that compromised the person health information of 2.81 million consumers. OCR used its February 2 announcement of the Banner Health settlement to warn health plans, health care providers, health care clearing houses (“covered entities”) and business associates covered by HIPAA to guard their own system containing protected health information against breach by cyber hacking even as the Department of Labor and other agencies are stepping up their cybersecurity rules, oversight and enforcement.

Banner Health Settlement

Banner Health is one of the largest non-profit health systems in the country, with over 50,000 employees and operating in six states. Banner Health is the largest employer in Arizona, and one of the largest in northern Colorado.

In November 2016, OCR initiated an investigation of Banner Health following the receipt of a breach report stating that a threat actor had gained unauthorized access to electronic protected health information, potentially affecting millions. The hacker accessed protected health information that included patient names, physician names, dates of birth, addresses, Social Security numbers, clinical details, dates of service, claims information, lab results, medications, diagnoses and conditions, and health insurance information.

OCR’s investigation found evidence of long term, pervasive noncompliance with the HIPAA Security Rule across Banner Health’s organization, a serious concern given the size of this covered entity. Organizations must be proactive in their efforts to regularly monitor system activity for hacking incidents and have measures in place to sufficiently safeguard patient information from risk across their entire network.

The potential violations specifically include: the lack of an analysis to determine risks and vulnerabilities to electronic protected health information across the organization, insufficient monitoring of its health information systems’ activity to protect against a cyber-attack, failure to implement an authentication process to safeguard its electronic protected health information, and failure to have security measures in place to protect electronic protected health information from unauthorized access when it was being transmitted electronically.

Under the Resolution Agreement and Corrective Action Plan negotiated to resolve these potential violations, Banner Health paid $1,250,000 to OCR. Banner Health also agreed to implement a corrective action plan, which identifies steps Banner Health will take to resolve these potential violations of the HIPAA Security Rule and protect the security of electronic patient health information that will be monitored for two years by OCR to ensure compliance with the HIPAA Security Rule. Under the corrective action plan, Banner has agreed to take the following steps:

Conduct an accurate and thorough risk analysis to determine risks and vulnerabilities to electronic patient/system data across the organization
Develop and implement a risk management plan to address identified risks and vulnerabilities to the confidentiality, integrity, and availability of ePHI
Develop, implement, and distribute policies and procedures for a risk analysis and risk management plan, the regular review of activity within their information systems, an authentication process to provide safeguards to data and records, and security measures to protect electronic protected health information from unauthorized access when it is being transmitted electronically, and
Report to HHS within thirty (30) days when workforce members fail to comply with the HIPAA Security Rule.

OCR Warns Other HIPAA-Covered Entities

In the health care sector, hacking is now the greatest threat to the privacy and security of protected health information. OCR’sannouncement of the serrlement reports 74 percent (74%) of the breaches reported to OCR in 2021 involved hacking/IT incidents.

The announcement also notes OCR offers an array of resources to help health care organizations bolster their cybersecurity posture and comply with the HIPAA Rules,

The settlement and OCR’s announcement warn other covered entities and business associates to use these and other necessary resources to protect their systems with protected health information from cyber hacking and other breaches.

In conjunction with reminding other covered entities of these resources, the settlement announcement quotes OCR Director Melanie Fontes Rainer as warning, ‘Hackers continue to threaten the privacy and security of patient information held by health care organizations, including our nation’s hospitals, … It is imperative that hospitals and other covered entities and business associates be vigilant in taking robust steps to protect their systems, data, and records, and this begins with understanding their risks, and taking action to prevent, respond to and combat such cyber-attacks. … Cyber security is on all of us, and we must take steps to protect our health care systems from these attacks.”

OCR’s enforcement record confirms these are not idyl threats. Breaches of the Security or Breach Notification Rules often result in significant civil monetary penalty assessments or negotiated settlements to mitigate civil liability exposures arising out of such breaches. See e.g., Clinical Laboratory Pays $25,000 To Settle Potential HIPAA Security Rule Violations (May 25, 2021); Health Insurer Pays $5.1 Million to Settle Data Breach Affecting Over 9.3 Million People (January 15, 2021); Aetna Pays $1,000,000 to Settle Three HIPAA Breaches(October 28, 2020); Health Insurer Pays $6.85 Million to Settle Data Breach Affecting Over 10.4 Million People (September 25, 2020); HIPAA Business Associate Pays $2.3 Million to Settle Breach Affecting Protected Health Information of Over 6 million Individual – (September 23, 2020); Lifespan Pays $1,040,000 to OCR to Settle Unencrypted Stolen Laptop Breach (July 27, 2020); Small Health Care Provider Fails to Implement Multiple HIPAA Security Rule Requirements (July 23, 2020).

Alerts issued by OCR regarding heightened security risks in recent months and a growing tide of highly publicized breaches send a strong warning to other covered entities and their business associates to reconfirm the adequacy of their own HIPAA privacy, security, breach notification and other procedures and protections by among other things:

Reviewing and monitoring on a documented, ongoing basis the adequacy and susceptibilities of existing practices, policies, safeguards of their own organizations, as well as their business associates and their vendors within the scope of attorney-client privilege taking into consideration data available from OCR, data regarding known or potential susceptibilities within their own operations as well as in the media, and other developments to determine if additional steps are necessary or advisable.
Updating policies, privacy and other notices, practices, procedures, training and other practices as needed to promote compliance and defensibility.
Renegotiating and enhancing service provider agreements to detail the specific compliance, audit, oversight and reporting rights, workforce and vendor credentialing and access control, indemnification, insurance, cooperation and other rights and responsibilities of all entities and individuals that use, access or disclose, or provide systems, software or other services or tools that could impact on security; to clarify the respective rights, procedures and responsibilities of each party in regards to compliance audits, investigation, breach reporting, and mitigation; and other relevant matters.
Verifying and tightening technological and other tracking, documentation and safeguards and controls to the use, access and disclosure of protected health information and systems.
Conducting well-documented training as necessary to ensure that members of the workforce of each covered entity and business associate understand and are prepared to comply with the expanded requirements of HIPAA, understand their responsibilities and appropriate procedures for reporting and investigating potential breaches or other compliance concerns, and understand as well as are prepared to follow appropriate procedures for reporting and responding to suspected
violations or other indicia of potential security concerns.
Tracking and reviewing on a systemized, well-documented basis actual and near miss security threats to evaluate, document decision-making and make timely adjustments to policies, practices, training, safeguards and other compliance components as necessary to identify and resolve risks.
Establishing and providing well-documented monitoring of compliance that includes board level oversight and reporting at least quarterly and sooner in response to potential threat indicators.
Establishing and providing well-documented timely investigation and redress of reported
violations or other compliance concerns.
Establishing contingency plans for responding in the event of a breach.
Establishing a well-documented process for monitoring and updating policies, practices and other efforts in response to changes in risks, practices and requirements.
Preparing and maintaining a well-documented record of compliance, risk, investigation and other security activities.
Pursuing other appropriate strategies to enhance the covered entity’s ability to demonstrate its compliance commitment both on paper and in operation.

Because susceptibilities in systems, software and other vendors of business associates, covered entities and their business associates should use care to assess and manage business associate and other vendor associated risks and compliance as well as tighten business associate and other service agreements to promote the improved cooperation, coordination, management and oversight required to comply with the new breach notification and other HIPAA requirements by specifically mapping out these details.

Beyond these HIPAA exposures, breaches and other HIPAA noncompliance carries other liability risks. Leaders of covered entities or their business associates also are cautioned that while HIPAA itself does not generally create any private right of action for victims of breach under HIPAA, breaches may create substantial liability for their organizations or increasingly, organizational leaders. For instance, the Department of Health & Human Services has warned health care providers participating in Medicare or other federal programs and Medicare Advantage health plans that HIPAA compliance is a program term of participation.

Health care providers and health insurers can face liability under state data privacy and breach, negligence or other statutory or common laws. In addition, physicians and other licensed parties may face professional discipline or other professional liability for breaches violating statutory or ethical standards.

Health plans also face a myriad of other exposures from failing to use appropriate cyber safeguards. Plan fiduciaries of employment based health plans covered by the Employee Retirement Income Security Act (“ERISA”} risk liability under ERISA’s fiduciary responsibility rules. The Department of Labor Employee Benefit Security Administration (“EBSA”) now audits the adequacy of the cybersecurity and other HIPAA compliance of health plans and their third party administrators and other business associates as part of EBSA’s oversight and enforcement of ERISA. Department of Labor Assistant Secretary for EBSA Lisa Gomez confirmed audit and enforcement of cybersecurity obligations is a key priority in EBSA’s current work plan in her February 4, 2023 comments to the American bar Association.

Meanwhile, the Securities and Exchange Commission has indicated that it plans to pursue enforcement against leaders of public health care or other public companies that fail to use appropriate care to ensure their organizations comply with privacy and data security obligations.

Furthermore, appropriate cyber security practices also may be advisable elements for organizations to include in their Federal Sentencing Guideline Compliance Programs to mitigate potential organization liability risks under federal electronic crime and related laws.

In the face of these risks and warnings, all covered entities and their business associates should reassess and confirm the adequacy of their and their business associates’ cyber security defenses and breach response preparations.

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About the Author

Ms. Stamer’s work throughout her 35 year career has focused heavily on working with health care and managed care, health and other employee benefit plan, insurance and financial services and other public and private organizations and their technology, data, and other service providers and advisors domestically and internationally with legal and operational compliance and risk management, performance and workforce management, regulatory and public policy and other legal and operational concerns. As an ongoing component of this work, she regularly advises, represents and defends HIPAA covered entities, business associates and other organizations on HIPAA and other cyber, privacy and data security concerns and has published and spoken extensively on these concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

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Posted by Cynthia Marcotte Stamer

DOJ Withdrawal of “Outdated” Health Care Antitrust Policies Leaves Federal Health Industry Competition & Antitrust Policy Ambiguous

February 3, 2023

With health industry consolidation and competition continuing to draw public and lawmaker scrutiny, the Department of Justice Antitrust Division today (February 3, 2022) signaled the Biden Administration plans to redirect health care antitrust policy by withdrawing three healthcare antitrust policy statements it says are outdated.

The withdrawn policy statements are three statements of antitrust principles adopted more than a decade ago by the DOJ and Federal Trade Commission (“FTC”) defining the agencies principles for interpreting and enforcing antitrust law in the healthcare industry:

Department of Justice and FTC Antitrust Enforcement Policy Statements in the Health Care Area (Sept. 15, 1993);
Statements of Antitrust Enforcement Policy in Health Care (Aug. 1, 1996); and
Statement of Antitrust Enforcement Policy Regarding Accountable Care Organizations Participating in the Medicare Shared Savings Program (Oct. 20, 2011).

The withdrawal of the statements follows growing activity by DOJ in challenging certain other health industry conduct as anticompetitive under Fdderal antitrust laws in recent years as well as new policies challenging noncompetition and other workforce practices used widely within the health care industry. (These developments were discussed in a September, 2022 Joint Committee on Employee Benefits webinar on Department of Justice Enforcement Update webinar moderated by Cynthia Marcotte Stamer.)

Following an uptake in DOJ health care and workforce antitrust enforcement in recent years, the announcement of the antitrust statement withdrawals confirms the Biden Administration led DOJ plans changes to care antitrust and other competition policies and enforcement impacting health care providers, payers, employers and other plan sponsors. In lieu of the principles previously provided by the withdrawn guidelines, DOJ says it will evaluate mergers and conduct in healthcare markets that may harm competition on the case-by-case basis. The announced plan to interpret antitrust law in health care on a case by case basis creates significant uncertainty about the scope of risk and safety of many contracting, business transaction and other activities in the health care industry. All segments of the marketplace should monitor developments and proceed cautiously to avoid inadvertently triggering challenges or liability as a result of the newly created ambiguity.

While employers, providers and others concerned about market power and consolidation among pharmacy benefit management companies (“PBMs”), mega healthcare systems and large health insurers are likely to welcome news of DOJ’s plan to update its policies and enforcement to reflect new market realities, DOJ’s announced plan to proceed on a case-by-case basis raises significant questions about the market participants and practices that will benefit or suffer under this new but undefined policy. Consequently, employer and other health plan sponsors, health industry providers, payers, and others concerned about health industry competition should proceed cautiously and carefully monitor developments at DOJ and FTC. Stay tuned for further developments.

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About the Author

A Fellow in the American College of Employee Benefit Counsel, Chair of the American Bar Association (“ABA”) International Section Life Sciences and Health Committee, Chair-Elect of the ABA TIPS Section Medicine & Law Committee, Past Chair of the ABA Managed Care & Insurance Interest Group, Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR, past chair of the the ABA RPTE Employee Benefits & Other Compensation Group and current co-Chair of its Welfare Benefit Committee, Ms. Stamer is most widely recognized for her decades of pragmatic, leading edge work, scholarship and thought leadership on health and managed care and employer benefits legal, public policy and operational concerns.

For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication.

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Posted by Cynthia Marcotte Stamer

EEOC Resource Explains Workplace ADA Requirements For Hearing Impaired

January 24, 2023

Employers and their hiring agents should review the updated Equal Employment Opportunity Commission (EEOC) resource on Americans with Disabilities Act (ADA) requirements for workplace accommodation of job applicants and employees who are deaf or hard of hearing or have other hearing conditions.

The Hearing Disabilities in the Workplace and the Americans with Disabilities Act release on January 24, 2023 follows a growing list of EEOC and other federal agency enforcement actions against businesses and other entities for improperly failing to accommodate or discriminating against individuals who are deaf, hard of hearing, or have other hearing conditions. See, e.g. EEOC’s newsroom.

The Hearing Disabilities in the Workplace and the Americans with Disabilities Act” guidance:

Outlines how certain pre- and post-job offer disability-related questions can violate the ADA,
Describes easy-to-access technologies that can make providing a reasonable accommodation for a hearing disability free or low-cost,
Addresses employer concerns about safety,
Shares scenarios of potential discrimination;
Adds nformation about discrimination against job applicants and new or updated examples that reflect available technologies,
Clarifies that discrimination may occur when employers act on unfounded assumptions that workers with hearing conditions will cause safety hazards, increase employment costs, or have difficulty communicating, and
Discusses harassment and retaliation.

In announcing the new guidance, EEOC Chair Charlotte A. Burrows warned, “Employers have a legal responsibility to create fair workplaces for all employees and job applicants who need reasonable accommodations,”

These and other developments send a clear warning to employers against failing to accommodate or otherwise discriminating, harassing or retaliating against individuals with hearing or other disabled employees and applicants. Employers should use care to maintain and document their compliance.

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About the Author

Board Certified in Labor and Employment Law by the Texas Board of Legal Specialization, a Fellow in the American College of Employee Benefits Counsel repeatedly recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” by LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law and among the “Best Lawyers In Dallas” in “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney and management consultant, author, public policy advocate and lecturer widely known for 30+ years of advising, representing and defending domestic and international public, closely held and government organizations on workforce, employee benefits, internal controls and governance, and other risk management, compliance and government relations concerns as well as her coaching, scholarship, training and legislative and public affairs advocacy on these and related areas.

Ms. Stamer helps health industry and other organizations and their management manage. Ms. Stamer’s legal and management consulting work throughout her nearly 35 year career has focused on helping organizations and their management use the law and process to manage people, process, compliance, operations and risk. Highly valued for her rare ability to find pragmatic client-centric solutions by combining her detailed legal and operational knowledge and experience with her talent for creative problem-solving, Ms. Stamer helps public and private, domestic and international businesses, governments, and other organizations and their leaders manage their employees, vendors and suppliers, and other workforce members, customers and other’ performance, compliance, compensation and benefits, operations, risks and liabilities, as well as to prevent, stabilize and cleanup workforce and other legal and operational crises large and small that arise in the course of operations.

Ms. Stamer works with businesses and their management, employee benefit plans, governments and other organizations deal with all aspects of human resources and workforce management operations and compliance. She supports her clients both on a real time, “on demand” basis and with longer term basis to deal with daily performance management and operations, emerging crises, strategic planning, process improvement and change management, investigations, defending litigation, audits, investigations or other enforcement challenges, government affairs and public policy. Well known for her extensive work with health care, insurance and other highly regulated entities on corporate compliance, internal controls and risk management, her clients range from highly regulated entities like employers, contractors and their employee benefit plans, their sponsors, management, administrators, insurers, fiduciaries and advisors, technology and data service providers, health care, managed care and insurance, financial services, government contractors and government entities, as well as retail, manufacturing, construction, consulting and a host of other domestic and international businesses of all types and sizes. Common engagements include internal and external workforce hiring, management, training, performance management, compliance and administration, discipline and termination, and other aspects of workforce management including employment and outsourced services contracting and enforcement, sentencing guidelines and other compliance plan, policy and program development, administration, and defense, performance management, wage and hour and other compensation and benefits, reengineering and other change management, internal controls, compliance and risk management, communications and training, worker classification, tax and payroll, investigations, crisis preparedness and response, government relations, safety, government contracting and audits, litigation and other enforcement, and other concerns. She also represents and defends clients in investigations, audits, enforcement actions and other dealings with the the Department of Labor, IRS, ICE, DOJ, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and a multitude of federal, state, and locate agencies, state attorneys’ general and other federal and state agencies, public and private credentialing, licensing and accreditation bodies, as well as conducts and counsels clients on private litigation, employment and other services disputes, regulatory and public policy advocacy, training and discipline, enforcement and other strategic and operational concerns.

Ms. Stamer uses her deep and highly specialized health, insurance, labor and employment and other knowledge and experience to help employers and other employee benefit plan sponsors; health, pension and other employee benefit plans, their fiduciaries, administrators and service providers, insurers, and others design legally compliant, effective compensation, health and other welfare benefit and insurance, severance, pension and deferred compensation, private exchanges, cafeteria plan and other employee benefit, fringe benefit, salary and hourly compensation, bonus and other incentive compensation and related programs, products and arrangements. She is particularly recognized for her leading edge work, thought leadership and knowledgeable advice and representation on the design, documentation, administration, regulation and defense of a diverse range of self-insured and insured health and welfare benefit plans including private exchange and other health benefit choices, health care reimbursement and other “defined contribution” limited benefit, 24-hour and other occupational and non-occupational injury and accident, expat and medical tourism, onsite medical, wellness and other medical plans and insurance benefit programs as well as a diverse range of other qualified and nonqualified retirement and deferred compensation, severance and other employee benefits and compensation, insurance and savings plans, programs, products, services and activities. As a key element of this work, Ms. Stamer works closely with employer and other plan sponsors, insurance and financial services companies, plan fiduciaries, administrators, and vendors and others to design, administer and defend effective legally defensible employee benefits and compensation practices, programs, products and technology. She also continuously helps employers, insurers, administrative and other service providers, their officers, directors and others to manage fiduciary and other risks of sponsorship or involvement with these and other benefit and compensation arrangements and to defend and mitigate liability and other risks from benefit and liability claims including fiduciary, benefit and other claims, audits, and litigation brought by the Labor Department, IRS, HHS, participants and beneficiaries, service providers, and others. She also assists debtors, creditors, bankruptcy trustees and others assess, manage and resolve labor and employment, employee benefits and insurance, payroll and other compensation related concerns arising from reductions in force or other terminations, mergers, acquisitions, bankruptcies and other business transactions including extensive experience with multiple, high-profile large scale bankruptcies resulting in ERISA, tax, corporate and securities and other litigation or enforcement actions.

Ms. Stamer also is deeply involved in helping to influence workforce, health care, pension, social security, insurance and other policies critical to the workforce, benefits, and compensation practices and other key aspects of a broad range of businesses and their operations. She both helps her clients respond to and resolve emerging regulations and laws, government investigations and enforcement actions and helps them shape the rules through dealings with Congress and other legislatures, regulators and government officials domestically and internationally. A former lead consultant to the Government of Bolivia on its Social Security reform law and most recognized for her leadership on U.S. health and pension, wage and hour, tax, education and immigration policy reform, Ms. Stamer works with U.S. and foreign businesses, governments, trade associations, and others on workforce, social security and severance, health care, immigration, privacy and data security, tax, ethics and other laws and regulations. Founder and Executive Director of the Coalition for Responsible Healthcare Policy and its PROJECT COPE: the Coalition on Patient Empowerment and a Fellow in the American Bar Foundation and State Bar of Texas, Ms. Stamer annually leads the Joint Committee on Employee Benefits (JCEB) HHS Office of Civil Rights agency meeting and other JCEB agency meetings. She also works as a policy advisor and advocate to many business, professional and civic organizations.

Author of the thousands of publications and workshops these and other employment, employee benefits, health care, insurance, workforce and other management matters, Ms. Stamer also is a highly sought out speaker and industry thought leader known for empowering audiences and readers. Ms. Stamer’s insights on employee benefits, insurance, health care and workforce matters in Atlantic Information Services, The Bureau of National Affairs (BNA), InsuranceThoughtLeaders.com, Benefits Magazine, Employee Benefit News, Texas CEO Magazine, HealthLeaders, Modern Healthcare, Business Insurance, Employee Benefits News, World At Work, Benefits Magazine, the Wall Street Journal, the Dallas Morning News, the Dallas Business Journal, the Houston Business Journal, and many other publications. She also has served as an Editorial Advisory Board Member for human resources, employee benefit and other management focused publications of BNA, HR.com, Employee Benefit News, InsuranceThoughtLeadership.com and many other prominent publications. Ms. Stamer also regularly serves on the faculty and planning committees for symposia of LexisNexis, the American Bar Association, ALIABA, the Society of Employee Benefits Administrators, the American Law Institute, ISSA, HIMMs, and many other prominent educational and training organizations and conducts training and speaks on these and other management, compliance and public policy concerns.

Ms. Stamer also shares her leadership through her extensive involvement in many professional, community and civic organizations. Currently, she serves as Scribe for the ABA JCEB Annual Agency Meeting with HHS-OCR and a representative for its Annual Agency Meeting with the EEOC, Chair of the ABA Intellectual Property Section Law Practice Management Committee, Vice Chair of the ABA International Section Life Sciences Committee, Chair-Elect of the ABA Tort & Insurance Section (TIPS) Medicine and Law Committee, RPTE Section Employee Benefits Committee Welfare Plan Chair, and in various other projects and capacities. She also previously has served as an ABA Joint Committee on Employee Benefits Council Representative, Chair of the ABA Health Law Section Managed Care & Insurance Interest Group and the ABA RPTE Employee Benefits & Other Compensation Group, the Society for Human Resources Management Region IV Board Chair and National Consultant’s Board Member; am Editorial Advisory Board Member and author for HR.com, Insurance ThoughtLeaders, BNA CD-Rolm, and Employee Benefits News; the Alliance for Healthcare Excellence Board President, Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association, Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, on the North Texas United Way Long Range Planning Committee Member, as a Board Member and Compliance Chair of the National Kidney Foundation of North Texas and many others.

Ms. Stamer also shares her extensive publications and thought leadership as well as leadership involvement in a broad range of other professional and civic organizations. These include hundreds of highly regarded articles and workshops on health and other benefits, workforce, health care and insurance concerns.

For more information about these requirements, Ms. Stamer or her experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication. Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

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Posted by Cynthia Marcotte Stamer

DOJ New Language Access Law Enforcement Initiative & Denver Police Language Access Investigation Resolution Highlight Need To Manage LEP Accommodation Compliance & Risks

December 19, 2022

The Justice Department announced the launch of a new nationwide Law Enforcement Language Access Initiative (“LEP Initiative”) to help law enforcement agencies meet obligations to provide meaningful language assistance to limited English proficient (LEP) individuals along with driving home it’s commitment to enforce these LEP obligations by announcing a LEP investigation resolution with the Denver Police Department.

LEP Initiative

The Civil Rights Division’s Federal Coordination and Compliance Section in partnership with U.S. Attorneys’ Offices will lead the new LEP Initiative. Specifically, the initiative will:

Develop technical assistance resources and tools that can assist local and state law enforcement agencies in their efforts to provide meaningful language access to LEP individuals and populations within their jurisdiction.
Affirmatively engage law enforcement agencies that want to review, update, and/or strengthen their language access polices, plans and training.
Leverage collaboration with U.S. Attorneys’ Offices to conduct trainings in communities across the country to increase awareness of language access obligations and encourage widespread adoption of best practices by law enforcement agencies.
Strengthen the department’s ties and engagement with LEP community stakeholders and LEP populations.

“Providing law enforcement agencies with the tools they need to ensure effective and meaningful language access promotes and advances greater safety for limited English proficient people,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Through this Initiative, we will be able to share these language access best practices and similar resources with law enforcement agencies all across the country.”

Denver LEP Resolution Agreement

Coincident with announcing the LEP Initiative, the Justice Department and the U.S. Attorney’s Office for the District of Colorado announced an agreement to resolve an investigation into allegations that the Denver Police Department (DPD) discriminated on the basis of national origin against LEP individuals in violation of Title VI of the Civil Rights Act of 1964. Title VI prohibits race, color, and national origin discrimination by recipients of federal financial assistance.

The Justice Department’s investigation of the DPD began after community members raised concerns about incidents involving Burmese and Rohingya-speaking LEP residents living in the East Colfax area of Denver. The Justice Department says it’s investigation revealed numerous instances where DPD officers either failed to provide language assistance to LEP individuals or provided language assistance that was ineffective or inappropriate. For example, the investigation uncovered situations where children, family members and bystanders were relied upon for language assistance, including in circumstances where more reliable and objective language assistance should have been provided.

As part of this settlement agreement, the DPD has agreed to implement a series of changes to its language access policies, procedures and training, including:

Updating its Language Access Policy and Plan in order to establish procedures for communicating with LEP individuals, including witnesses and suspects, and to prohibit the use of children, family members, or bystanders to communicate with LEP individuals, except in exigent circumstances;

Appointing its first-ever LEP Coordinator and establish Language Access Points of Contact (LAPCs) in every DPD district;
Training all DPD employees and new recruits on identifying, communicating with, and documenting interactions with LEP individuals; and
Creating a Language Access Committee that includes stakeholders representing LEP community interests.

The Justice Department announcement of the LEP Initiative in conjunction with the DPD and other growing series of investigations and enforcement demonstrates the strength of the Biden Administration’s continuing emphasis on the advancement of LEP and other civil rights and their enforcement in the public and private sector.

Public sector, organizations and agencies facing investigation commonly face threats to their federal funding if compliance deficiencies are found in an investigation.

Healthcare, educational, government, funded housing, and government contractors can expect discrimination, prosecution and sanctions, federal program, exclusion, or funding, and other sanctions in response to a finding of noncompliance.

Meanwhile, all other covered entities at minimum face, the threat of lawsuits brought by the government, private, litigants, or both.

Even when these enforcement actions are resolve, a bolster negotiation, the expenses of defense and correction can be high. The sanctions, cost of defense and other anticipated fall out where they violations are indefensible, or so great that negotiation of a reasonable resolution is difficult present even greater risks and costs. To mitigate exposure to these risks and costs, all organizations should review their current practices and training to shore up their efforts, in anticipation of a possible complaint or investigation.

Organizations should seek help from experienced legal counsel to design and train their operations leaders and team about appropriate practices and should seek the advice of legal counsel with investigation of complaints or other concerns, questions or any other issues about the adequacy of practices, documentation or other concerns impacting their compliance with these and other discrimination and civil rights practices in light of this emphasis. Organizations also should be careful to avoid any actions that might be construed as retaliation. Parties raising concerns should be carefully dealt with as the expression of these concerns could provide a basis for complaints, as well as complaints or prosecution for retaliation.

More Information

About the Author

For more information about these requirements, Ms. Stamer or her experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication. Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

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Posted by Cynthia Marcotte Stamer

H-2B Visa 2023 Application Window Opens 1/1; New Attestation Form Required

December 19, 2022

The filing window to submit an H-2B Application for Temporary Employment Certification (Form ETA-9142B and appendices) requesting work start dates of April 1, 2023, or later, opens January 1, 2023, at 12:00 a.m. Eastern Time. Employers submitting H-2B visa applications in 2023 should prepare to file the newly required Form ETA-9142-B-CAA-7, Attestation for Employers Seeking to Employ H-2B Nonimmigrant Workers Under Section 204 of Division O of the Consolidated Appropriations Act, 2022, Public Law 117-103, and Public Law 117-180 (the “Form”).

OFLC has announced that following OFLC’s standard operating procedures, H-2B applications requesting an April 1, 2023, work start date will be denied if they are filed before January 1, 2023, at 12:00 a.m. Eastern Time. OFLC plans to randomly order for processing all H-2B applications requesting a work start date of April 1, 2023, filed during the initial three calendar days (January 1-3, 2023) using the randomization procedures published in the Federal Register on March 4, 2019. Each day, from January 3, 2023 through January 6, 2023, OFLC will publish on the Foreign Labor Application Gateway System website the number of H-2B applications it has received to date and the total number of requested worker positions on those applications. Employers, workers awaiting these visas and other stakeholders should monitor the Gateway to assess the continued availability of the allotted H-2B visas.

Meanwhile, the Department of Labor Employment and Training Administration on December 16, 2022 published a notice announcing the 2023 AEWR for herding or production of livestock on the range in the Federal Register. The AEWR for occupations involving herding or production of livestock on the range is new for the H-2A Program. AEWRs are the minimum wage rates the Department of Labor has determined must be offered and paid by employers to H-2A workers and workers in corresponding employment to help ensure the Department meets its statutory obligation to certify that the employment of H-2A foreign workers will not adversely affect the wages of agricultural workers in the U.S. similarly employed. Employers affected by this mandated minimum wage rates should account for these rates in their budgeting and compliance activities.

The Office of Foreign Labor Certification (“OFLC”) announced December 19, 2022 that employers requesting H-2B visas to hire nonimmigrant workers under the FY2023 cap increase must complete and submit the new the new Form. The Form and its instruction currently available for immediate use by employees here. Employers planning to request H-2B visas should obtain and begin preparing the Form along with their applications to be ready to file when the 2023 application window open January 1, 2023.

For Help With Comments, Investigations Or Other Needs

If your organization would like to learn more about the concerns discussed in this update or seeks assistance auditing, updating, administering or defending its human resources, compensation, benefits, corporate ethics and compliance practices, or other performance related concerns, contact management attorney and consultant Cynthia Marcotte Stamer.

An attorney Board Certified in Labor & Employment Law by Texas Board of Legal Specialization, Ms. Stamer is recognized for work helping organizations management people, operations and risk as a Fellow in the American College of Employee Benefit Counsel, a “Top Woman Lawyer,” “Top Rated Lawyer,” and “LEGAL LEADER™” in Labor and Employment Law and Health Care Law; a “Best Lawyers” in “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law.”

For 35 years, Ms. Stamer’s work has focused on advising and assisting businesses and business leaders with these and other employment and other staffing, employee benefit, compensation, risk, performance and compliance management and other operational solutions and concerns. Her experience includes helping management both manage performance and manage legal risk and compliance. While helping businesses define and manage the conduct and performance of their employees, contractors and vendors, she also assists employers and others about compliance with federal and state equal employment opportunity, compensation, health and other employee benefit, workplace safety, leave, and other labor and employment laws, advises and defends businesses against labor and employment, employee benefit, compensation, fraud and other regulatory compliance and other related audits, investigations and litigation, charges, audits, claims and investigations by the IRS, Department of Labor, Department of Justice, SEC, Federal Trade Commission, HUD, HHS, DOD, Departments of Insurance, and other federal and state regulators. Ms. Stamer also speaks, coaches management and publishes extensively on these and other related matters. For additional information about Ms. Stamer and her experience or to access other publications by Ms. Stamer see here or contact Ms. Stamer directly.

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NOTICE: Terms. These materials are for general informational and educational purposes only. They do not establish an attorney-client relationship, are not legal advice, a substitute for legal advice, an offer or commitment to provide legal advice or an admission. The information and statements in these materials may not address all relevant issues or apply to any situation or circumstances. The author reserves the right to qualify or retract any of these statements at any time. and does not necessarily address all relevant issues. Because the law evolves and in ways that subsequent developments could impact the currency and completeness of this discussion. The author disclaims and has no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers are urged to engage competent legal counsel for consultation and representation considering the specific facts and circumstances presented in their unique circumstance at any time. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication. Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein. ©2022 Cynthia Marcotte Stamer. Nonexclusive right to republish granted to Solutions Law Press, Inc. All other rights reserved.

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Posted by Cynthia Marcotte Stamer

NJ McDonald’s Franchisee Pays $100K For Firing Autistic Employee

December 16, 2022

New Jersey McDonald’s franchisee JDKD Enterprises, L.P will pay $100,000 to settle a disability discrimination lawsuit arising from its termination of an autistic employee filed by the U.S. Equal Employment Opportunity Commission (“EEOC”). The lawsuit warns other employers against failing to reasonably accommodate or otherwise discriminating against individuals with autism or other disorders who can perform essential job functions with or without reasonable accommodation.

The EEOC’s lawsuit charged JDKD Enterprises fired an employee who worked at several McDonald’s restaurants for 37 years because of his autism spectrum disorder. The employee’s per-formance remained excellent throughout his decade-long employment at the Deptford, New Jersey McDonald’s, receiving numerous awards and accolades acknowledging his excellent job performance. However, two months after JDKD Enterprises, L.P., assumed ownership of this McDonald’s, it abruptly terminated the grill cook.

The EEOC argued the termination of the employee due to his autism disorder violates the Americans with Disabilities Act (ADA), which requires employers to provide reasonable accommodations to employees with disabilities and prohibits employers from taking adverse employment actions based on an individual’s disability or need for accommodations. After first attempting to reach a pre-litigation settlement through its voluntary conciliation process, the EEOC filed suit (Civil Action No. 1:21-cv-16441) in U.S. District Court for the District of New Jersey,

In addition to paying the former employee $100,000 in monetary relief, the two-year consent decree settling the suit provides for systemic relief intended to prevent further disability discrimination, periodic reporting to the EEOC, and training for all management personnel in responding to reasonable accommodation requests.

“The ADA protects people with autism spectrum disorder, and the EEOC is absolutely committed to aggressively enforcing the ADA requirement that employers reasonably accommodate their workers with disabilities absent undue hardship,” said Debra Lawrence, regional attorney for the EEOC’s Philadelphia District Office in the EEOC announcement of the settlement.

In the EEOC announcement of the settlement, quotes EEOC Philadelphia District Director Jamie Williamson as saying, “Ensuring that all employees, especially management, are properly trained regarding their obligations under the ADA – including their duty to engage in good faith, diligent communications with their disabled employees about accommodation needs – is a smart business practice and the right thing to do. Leadership means stewardship of an organization’s most valuable asset – its people.”

The EEOC suit and statements warn other organizations dealing with employees with autistic spectrum or other disabilities not to discriminate and to be prepared to defend the adequacy of their actions regardless of whether choosing to allow or deny accommodation.

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Hospital Religous Discrimination Suit For Refusing To Exempt Worker Frim COVID Vaccination Warns Other Employers Denying Accommodation Risky

December 15, 2022

Children’s Healthcare of Atlanta (CHOA), a pediatric healthcare system in Georgia, faces a religious discrimination lawsuit filed by U.S. Equal Employment Opportunity Commission (EEOC) that charges CHOA violated federal law by firing a maintenance assistant for requesting a religious exemption to its influenza vaccination policy.

Title VII of the Civil Rights Act of 1964 prohibits firing an employee because of his religion and requires that employers accommodate sincerely held religious beliefs unless the employer proves accommodation would impose an undue hardship. EEOC COVID guidance warns employers of the EEOC’s interpretation of the continued applicability of Title VII’s religous accommodation requirements to employers enforcement of COVID and other vaccine mandates. Other related guidance also warns employers to avoid retaliation against employees for expressing religous objections to vaccination policies or engaging in other protected actions in violation of Title VII.

The EEOC’s suit states the maintenance employee, in accordance with CHOA’s procedures, requested a religious exemption to CHOA’s flu vaccination requirements based on sincerely held religious beliefs. CHOA previously granted the employee a religious exemption in 2017 and 2018. In 2019, however, CHOA changed its policy and denied the employee’s request for a religious accommodation and fired him, despite the employee’s extremely limited interaction with the public or staff.

The EEOC asserts it would not have been an undue burden for CHOA to continue accommodating its employee as it had in 2017 and 2018. However it instead changed its stance on flu vaccination exemptions for this maintenance employee in 2019 and failed to consider any meaningful reasonable accommodations for his sincerely held religious beliefs.

Charging the refusal to grant accommodation arges this alleged conduct violates Title VII, the EEOC filed suit (Civil Action No. 1:22-CV-4953 MLB RDC) in U.S. District Court for the Northern District of Georgia, Atlanta Division, after first attempting to reach a pre-litigation settlement via its conciliation process. The EEOC lawsuit seeks back pay, front pay, compensatory damages and punitive damages for the employee, as well as injunctive relief to prevent future discrimination.

The suit against CHOA follows through on the EEOC’s commitment to investigate and enforce Title VII against employees failing to grant exemptions to otherwise applicable COVID or other vaccination requirements to employees with sincerely held religous beliefs against vaccination unless the employer proved undue hardship preventing the accommodation.

The lawsuit warns other employers with vaccination requirements to provide accommodations for employees with deeply held religous beliefs against the vaccine unless the employer can prove undue hardship sufficient to excuse the accommodation. The prosecution of the suit against a health care organization subject to the tightest vaccination and other COVID safety mandates under Centers for Disease Control, the Centers for Medicare & Medicaid Services and Occuoatiinal Safety & Health Administration regulations demonstrates the high burden the EEOC expects employers refusing accommodation to meet. In light of these EEOC CHOA and other enforcement actions, employers should proceed carefully before refusing accommodation. As COVID and other pandemic and epidemic outbreaks continue to threaten workers, patient, customer and community safety, organizations must tred carefully and be prepared to defend the adequacy of their actions regardless of whether choosing to allow or deny accommodation from applicable communicable disease protocols.

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Posted by Cynthia Marcotte Stamer

Trucking Company Nailed For Discriminating Against Non-Citizens In I-9 Verification Practices

December 13, 2022

A settlement agreement with trucking company with Navajo Express announced by the Justice Department (“DOJ”) today a warns other businesses to use care when dealing with non-citizen applicants and workers to avoid violating the Immigration and Nationality Act (INA) while concurrently complying with federal mandates to verify eligibility of each worker to work in the United States.

Federal law generally mandates every employer verify the identity and eligibility to work of each employee to present an acceptable combination of original documents from the choices specified on the Form I-9 that appear valid on their face and complete the employee portion of the Form I-9. Meanwhile, the INA prohibits businesses from discriminating based on national origin in the application of these procedures or other terms and conditions of hiring or employment. The widespread availability and use of high quality, fraudent documentation, misperceptions about requirements and other factual developments require businesses to tread carefully to comply with both of these rules simultaneously.

I-9 Rules

The Form I-9 and associated rules require employers to require completion of the Form I-9 and the employee to present specified original documents that establish his identity and eligibility to work. Employers can face substantial civil penalties or even criminal prosecution for failing to meet these requirements.

The I-9 rules specify the document or combination of original documents that a worker can use as proof of identity and work eligibility. Since the Form I-9 and the documentation acceptable for proof of identity and work eligibility change from time to time, businesses always should verify they are using to most current Form I-9 and use it to guide decisions about which documents or combination of documents fulfill the proof requirements when presented by an employee. It bears noting that although the most current Form I-9 Form was scheduled to expire in October, 2022, the Department of Immigration and Customs Enforcement (“ICE”) says employers should continue to use that Form for I-9 compliance until ICE releases an updated Form.

Since the widespread availability of fraudulent documents often makes determination if the validity of documents from physical examination alone, the E-Verify Program allows employers to use the E-Verify process to check the validity of the documents for each worker or where the employer is put on notice that the documents presented by a particular worker are not valid. Otherwise, however, if a worker presents any of the allowable combinations of documents specified in the Form I-9, federal law, mandates that the business accept the presented documentation as proof of identity and eligibility to work unless the employer comes into information that puts the employer on notice that the documents that appeared valid, in fact are not genuine.

INA Discrimination

The INA’s anti-discrimination provision prohibits employers from asking for specific because of a worker’s citizenship, immigration status or national origin. Indeed, many non-U.S. citizens, including lawful permanent residents, refugees and asylees, are eligible for several of the same types of documents to prove their permission to work as U.S. citizens (such as driver’s licenses and unrestricted Social Security cards). Employers must allow workers to present whatever acceptable documentation the workers choose and cannot reject valid documentation that reasonably appears to be genuine. In addition, if a lawful permanent resident provides an unexpired permanent resident card to prove their permission to work, employers must not request new documentation if the permanent resident card later expires.

Navaho Express

Navaho Express got nailed for requiring more than what the I-9 rules require for proof of eligibility to work from individuals perceived noncitizens. The Navajo Express settlement resolves DOJ charges Navaho Express violated the INA by discriminating against non-U.S. citizen workers when checking their permission to work in the United States.

DOJ’s investigation began after a non-U.S. citizen complained that Navajo Express refused to accept valid documentation proving his permission to work and demanded a different document from him. DOJ’s investigation determined that Navajo Express routinely required lawful permanent residents to show their permanent resident cards (known as “green cards”) to prove their permission to work, even when they had already presented other valid documentation. The investigation also revealed that Navajo Express had a policy of unlawfully requiring permanent residents to provide new permanent resident cards when their old permanent resident cards expired, even though such documentation is unnecessary under existing rules.

Under the terms of the settlement, Navajo Express will pay more than $40,000 in civil penalties to the United States, train staff on the INA’s anti-discrimination provision, review and revise their employment policies, and be subject to departmental monitoring for a two-year period.

In addition to DOJ enforcement actions like Navoho Express, businesses also can face significant damage awards in lawsuits for discrimination brought by applicants and employees. Consequently, all businesses should use care to ensure their non discriminatory documented compliance with the I-9 rules without impermissible discrimination or retaliation. Businesses should seek help from experienced legal counsel to design and train their Human Resources team about appropriate practices and should seek the advice of legal counsel with questions or concerns about evidence or concerns about the validity or adequacy of documentation or other concerns impacting their compliance with both laws.

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For more information about these requirements, Ms. Stamer or her experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

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NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication. Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

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Updated Tool To Help App Developers, Employers & Health Plans Understand When Certain Federal Rules Apply To Health, Wellness & Fitness Apps

December 8, 2022

Employers, health plans and insurers and others increasingly are looking to applications to help support their employees and others and health, fitness, and wellness activities. Those using and promoting these applications in the developers that provide the applications must carefully identify and negotiate a diverse array of federal and state laws, regulations and rulings when designing and deploying their apps.

Since figuring out which federal rules apply often proves challenging, the Federal Trade Commission (FTC) in conjunction with the HHS Office for Civil Rights (OCR), the HHS Office of the National Coordinator for Health Information Technology (ONC), and the Food and Drug Administration (FDA) maintain and have just updated the Mobile Health App Interactive Tool intended to help developers of health-related mobile apps understand when and federal laws and regulations might apply.

While not covering all relevant legal risks, the guidance tool does highlight certain key regulatory concerns by asking developers a series of high-level questions about the nature of their app, including about its function, the data it collects, and the services it provides to users. Based on the developer’s answers to those questions, the guidance tool points the app developer toward detailed information about certain federal laws that might apply to the app. These include the FTC Act, the FTC’s Health Breach Notification Rule, the Children’s Online Privacy Protection Act (COPPA), the Health Insurance Portability and Accountability Act (HIPAA), the Federal Food, Drug and Cosmetics Act (FD&C Act), and the 21st Century Cures Act and ONC Information Blocking Regulations.

Using the tool can help to clarify the potential applicability of these rules to a proposed app and help focus the developer on issues to consider regarding these laws as they design in administer their apps. Running through the tool also could help reduce legal fees and other consulting anniversary costs by helping developers of these apps gather helpful information and be more prepared to participate in informed manner when working with the legal team on their compliance. Additionally documented use of the tool could prove helpful in the event of a compliance audit or investigation by capturing evidence helpful to establish a culture of compliance or mitigate other potential liability concerns.

Of course app developers using these tools need to keep in mind that they are not legal advice or a substitute for legal advice. The tools only are intended to provide guidance regarding the potential likely application of the rules covered by the tool. They do not cover broad range of other federal and state Laws, regulations, rulings, and contractual commitments that also can impact the use and design of these apps and their defensibility and a broad range of circumstances. Moreover developers also should keep in mind that the use of the tools and their discussion may uncover existing or past compliance concerns, which might best be conducted within the protection of attorney-client privilege. Consequently, developers and users should consult and closely worked with experienced, qualified legal counsel to address these and other legal risks and compliance.

Employer another health plans and wellness program sponsors and administrators also need to be careful when contracting for and deploying these apps. Bungled compliance obligations could trigger a myriad of direct or indemnification liabilities, investigation and defense costs and mistrust, among other things. Accordingly sponsors and others looking to work with app developers to the deploy solution should both conduct careful due diligence and contracting and monitor ongoing use and compliance and risks.

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Employers Should Review Workplace Violence Plans and Training In Response To Recent Workplace Violence Tragedies

November 29, 2022

Two mass shootings of workers at Walmarts in Virginia in less than a month and a series of other recent workplace shootings around the country should prompt other employers to evaluate the adequacy of their own workplace violence safeguards under and other laws.

As demonstrated by the already filed state lawsuit filed by an employee of the Chesapeake, Virginia Walmart where a supervisor fatally shot six people in October, 2022, see here, businesses experiencing workplace violence events typically face OSHA and other investigations, lawsuits and critical media and public scrutiny. A well-documented and administered workplace violence safety plan can help mitigate legal and other risks.

The Occupational Safety & Health Administration (“OSHA”) generally considers protecting workers against workplace violence part of an employer’s general duty to make the workplace safe under the Occupational Safety and Health Act (“(OSH Act”).

OSHA defines “workplace violence” as including any act or threat of physical violence, harassment, intimidation, or other threatening disruptive behavior that occurs at the work site. It ranges from threats and verbal abuse to physical assaults and even homicide. It can affect and involve employees, clients, customers and visitors.

Many business leaders underestimate their organization’s workplace violence risk. Workplace violence is a much more common problem than most American business leaders realize. According to the Bureau of Labor Statistics Census of Fatal Occupational Injuries (CFOI), reported workplace injury data reflects there were 392 workplace homicides in 2020, the most recent year for which BLS has published data. There were also 37,060 nonfatal injuries in the workplace resulting from an intentional injury by another person. The five occupational groups with the most workplace homicides in 2020 were sales and related, transportation and material moving, management, construction and extraction, and production. Homicides in sales and related occupations accounted for 23.5 percent of all workplace homicides in 2020. See here.

Research has identified factors that may increase the risk of violence for some workers at certain worksites, such as exchanging money with the public, working with volatile, unstable people, working alone or in isolated areas, providing services and care, working where alcohol is served, time of day and location of work, Among those with higher-risk are workers who exchange money with the public, delivery drivers, healthcare professionals, public service workers, customer service agents, law enforcement personnel, and those who work alone or in small groups.

In most workplaces where risk factors can be identified, the risk of assault can be prevented or minimized if employers take appropriate precautions.

OSHA believes that a well-written and implemented workplace violence prevention program, combined with engineering controls, administrative controls and training can reduce the incidence of workplace violence in both the private sector and federal workplaces. Therefore, OSHA expects employers to assess their worksites to identify methods for reducing the likelihood of incidents occurring and adopt and implement an appropriate plan.

There are currently no specific OSHA standards for workplace violence. Rather the guidance contemplates each business will tailor an appropriate plan to fit its operations. OSHA provides various resources to aid employers ti DD slop their organization’s plan. The employer is responsible for tailoring an appropriate policy; the guidance strongly suggests including a zero-tolerance policy toward workplace violence covering all workers, patients, clients, visitors, contractors, and anyone else who may come in contact with company personnel.

OSHA has developed Enforcement Procedures and Scheduling for Occupational Exposure to Workplace Violence, which provides guidance and procedures to be followed when conducting inspections and issuing citations related to the occupational exposure to workplace violence. These procedures also provide insight for employers to tailor their plans and practices. Including policies for emergency response, investigation and remediation also is advisable.

The plan can be a separate workplace violence prevention program or can be incorporated into a safety and health program, employee handbook, or manual of standard operating procedures. Employers are responsible for ensuring all workers know the policy and understand that all claims of workplace violence will be investigated and remedied promptly. In addition, OSHA encourages employers to develop additional methods as necessary to protect employees in high risk industries.

In developing and administering their workplace violence policies, employers should seek both to prevent workplace violence and build a record that can help the employer defend against or mitigate legal and other business risks in the event of an incident. Employers also should reevaluate and update their policies and practices in response to events within their own or other workplaces as necessary. Working with qualified legal counsel within the scope of attorney-client privilege may help strengthen the risk assessment and policy design, while insulating sensitive discussions and analysis with the attorney-client communication or work product privileges.

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Ms. Stamer works with businesses and their management, employee benefit plans, governments and other organizations deal with all aspects of human resources and workforce management operations and compliance. She supports her clients both on a real time, “on demand” basis and with longer term basis to deal with daily performance management and operations, emerging crises, strategic planning, process improvement and change management, investigations, defending litigation, audits, investigations or other enforcement challenges, government affairs and public policy. Well known for her extensive work with health care, insurance and other highly regulated entities on corporate compliance, internal controls and risk management, her clients range from highly regulated entities like employers, contractors and their employee benefit plans, their sponsors, management, administrators, insurers, fiduciaries and advisors, technology and data service providers, health care, managed care and insurance, financial services, government contractors and government entities, as well as retail, manufacturing, construction, consulting and a host of other domestic and international businesses of all types and sizes. Common engagements include internal and external workforce hiring, management, training, performance management, compliance and administration, discipline and termination, and other aspects of workforce management including employment and outsourced services contracting and enforcement, sentencing guidelines and other compliance plan, policy and program development, administration, and defense, performance management, wage and hour and other compensation and benefits, reengineering and other change management, internal controls, compliance and risk management, communications and training, worker classification, tax and payroll, investigations, crisis preparedness and response, government relations, safety, government contracting and audits, litigation and other enforcement, and other concerns. She also represents and defends clients in investigations, audits, enforcement actions and other dealings with the the Department of Labor, IRS, HHS, DOD, FTC, SEC, CDC and other public health, Department of Justice and a multitude of federal, state, and locate agencies, state attorneys’ general and other federal and state agencies, public and private credentialing, licensing and accreditation bodies, as well as conducts and counsels clients on private litigation, employment and other services disputes, regulatory and public policy advocacy, training and discipline, enforcement and other strategic and operational concerns.

For more information about these requirements, Ms. Stamer or her experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.

About Solutions Law Press, Inc.™

IMPORTANT NOTICE ABOUT THIS COMMUNICATION

NOTICE: These statements and materials are for general informational and purposes only. They do not establish an attorney-client relationship, are not legal advice or an offer or commitment to provide legal advice, and do not serve as a substitute for legal advice. Readers are urged to engage competent legal counsel for consultation and representation in light of the specific facts and circumstances presented in their unique circumstance at any particular time. No comment or statement in this publication is to be construed as legal advice or an admission. The author and Solutions Law Press, Inc.™ reserve the right to qualify or retract any of these statements at any time. Likewise, the content is not tailored to any particular situation and does not necessarily address all relevant issues. Because the law is rapidly evolving and rapidly evolving rules makes it highly likely that subsequent developments could impact the currency and completeness of this discussion. The author and Solutions Law Press, Inc.™ disclaim, and have no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication. Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein.

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Posted by Cynthia Marcotte Stamer

Attorney Filer of ADA Lawsuits Pleads Guilty to Filing False Tax Returns For Not Reporting Disability Lawsuit Settlement Income

November 29, 2022

A California attorney known for his filing of thousands of disability discrimination lawsuits under the Americans with Disabilities Act of 1990 (“ADA”) with himself as the plaintiff plead guilty November 29 to filing a false tax return on which he underreported the income he earned from many of those lawsuits. Aside from the enjoyment many businesses victimized by the defendant’s or other similar disability lawsuits may experience over seeing the defendant get his own comeuppance, the prosecution and the plea also provide important reminders for businesses paying ADA or other settlements to applicants or former employees.

According to court documents and statements made in court, Scott Norris Johnson owned and operated Disabled Access Prevents Injury Inc (DAPI), a legal services corporation. A quadriplegic and an attorney, Johnson filed more than 4,000 lawsuits in the Eastern District of California and elsewhere under the ADA and related California statutes, naming himself as the plaintiff against businesses he claimed were not in compliance with state and federal disability access laws first using DAPI, and later a law firm,

Under the Small Business Job Protection Act of 1996, payments related to lawsuit settlements or awards are taxable unless paid on account of personal physical injury or physical sickness. Johnson, who worked as an attorney at the Internal Revenue Service (“IRS”) earlier in his career, was required to report the taxable portion of the lawsuit settlements and awards he received. He nonetheless intentionally underreported this income on his 2012, 2013, and 2014 tax returns. By understating the lawsuit settlements and awards, Johnson and DAPI paid little to no income tax for tax years 2012, 2013 and 2014. Johnson caused a loss to the IRS of more than $250,000.

Johnson is scheduled to be sentenced on March 7, 2023, and faces a maximum penalty of three years in prison for filing a false tax return. He also faces also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The prosecution and subsequent plea highlight the taxability of disability and certain other settlements and the willingness of the Justice Department and IRS to prosecute individuals and businesses failing to fulfill obligations to recognize and report those payments as income for federal tax purposes.

Businesses and their legal counsel entering into settlements or otherwise making payments to employees or applicants under the ADA or other taxable settlements generally should use care to properly report taxable amounts as income to the recipient. For payments made pursuant to a settlement agreement, the settlement agreement generally should provide both that the employer is authorized to deduct and withhold amounts the employer believes may be due from the employee for taxes as well as obligate the employee to report and pay any additional taxes due on the payment.

Obviously, the business also needs to ensure it properly reports and pays its required share of any employment taxes on the payments. Employees should confirm the current tax rules prior to making any agreement or payment to avoid mistakes.

Businesses also should keep in mind many other developments could impact the interpretation and enforcement of settlements and their resulting responsibilities. Changes to trade secret, noncompete, arbitration, voluntariness and other requirements for release of claims, arbitration, scope of release and other developments could materially affect the effectiveness of previously used settlement language. Wise business leaders will seek qualified legal advice and assistance with their settlements.

For Help With Comments, Investigations Or Other Needs

If your organization would like to learn more about the concerns discussed in this update or seeks assistance auditing, updating, administering or defending its human resources, compensation, benefits, corporate ethics and compliance practices, or other performance related concerns, please contact management attorney and consultant Cynthia Marcotte Stamer.

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NOTICE: These materials are for general informational and educational purposes only. They do not establish an attorney-client relationship, are not legal advice, a substitute for legal advice, an offer or commitment to provide legal advice or an admission. The information and statements in these materials may not address all relevant issues or apply to any situation or circumstances. The author reserves the right to qualify or retract any of these statements at any time. and does not necessarily address all relevant issues. Because the law evolves and in ways that subsequent developments could impact the currency and completeness of this discussion. The author disclaims and has no responsibility to provide any update or otherwise notify anyone any such change, limitation, or other condition that might affect the suitability of reliance upon these materials or information otherwise conveyed in connection with this program. Readers are urged to engage competent legal counsel for consultation and representation considering the specific facts and circumstances presented in their unique circumstance at any time. Readers may not rely upon, are solely responsible for, and assume the risk and all liabilities resulting from their use of this publication. Readers acknowledge and agree to the conditions of this Notice as a condition of their access of this publication. Circular 230 Compliance. The following disclaimer is included to ensure that we comply with U.S. Treasury Department Regulations. Any statements contained herein are not intended or written by the writer to be used, and nothing contained herein can be used by you or any other person, for the purpose of (1) avoiding penalties that may be imposed under federal tax law, or (2) promoting, marketing or recommending to another party any tax-related transaction or matter addressed herein. ©2022 Cynthia Marcotte Stamer. Nonexclusive right to republish granted to Solutions Law Press, Inc. All rights reserved.

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Posted by Cynthia Marcotte Stamer

Proposed Changes To Substance Abuse Confidentiality Rules Could Create New Burdens For Employers & Health Plans

November 28, 2022

January 30 Deadline To Comment On HHS’ Proposed Changes To Substance Use Confidentiality Rules

Employers, their health plans and issuers, substance abuse, mental health and other healthcare providers, health care professional associations, consumer advocates, community organizations, state and local government entities, patients and caregivers and others concerned with mental health and substance abuse treatment and management should review and comment by January 30, 2023 on proposed changes to rules on unauthorized disclosures the Confidentiality of Substance Use Disorder (SUD) Patient Records under 42 CFR part 2 (“Part 2”) proposed by the U.S. Health and Human Services Department Office for Civil Rights (OCR) and the Substance Abuse and Mental Health Services Administration (SAMHSA) in a Notice of Proposed Rulemaking (NPRM) made public November 28, 2022 here and scheduled for publication in the December 2, 2022 Federal Register. In addition to obvious implications for health care providers and health plans, the proposed changes are likely to impact both the confidentiality requirements for employer-sponsored and other health benefit programs, as well as the ability and responsibilities of businesses seeking to access or use information about prior substance use and abuse in their workplaces or for other legitimate purposes.

Proposed Changes To Substance Abuse Confidentiality Rules

On November 28, 2022, OCR and SAMHSA issued the NPRM to revise the Confidentiality of Substance Use Disorder Patient Records regulations at 42 CFR part 2 (“Part 2”), which seek to address concerns that concerns about discrimination or prosecution might deter people from entering treatment for SUD by protecting “records of the identity, diagnosis, prognosis, or treatment of any patient which are maintained in connection with the performance of any program or activity relating to substance abuse education prevention, training, treatment, rehabilitation, or research, which is conducted, regulated, or directly or indirectly assisted by any department or agency of the United States.”(“SUD Records”).

Currently, the Part 2 protections of patient privacy and records concerning treatment related to substance use challenges from unauthorized disclosures differ from the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy, Breach Notification, and Enforcement Rules (“HIPAA”) rules. These distinctions reportedly create barriers to information sharing by patients and among health care providers and create dual obligations and compliance challenges for regulated entities. To address this concern, Congress mandated in Section 3221 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) that HHS to bring Part 2 into greater alignment with certain aspects of the HIPAA Privacy rule.

The NPRM seeks to address the CARES Act mandate as Americans and their leaders struggle to continue to provide pathways for victims of substance abuse and other mental health challenges to pursue treatment and maximize their participation and enjoyment in our communities while addressing safety concerns about a growing series of rare but notorious acts of violence committed by certain inadequately diagnosed or managed victims of mental health or substance abuse. See, e.g., Fact Sheet: President Biden To Announce Strategy To Address Our National Mental Health Crisis, As Part Of Unity Agenda In His First State Of The Union; President Biden Releases National Drug Control Strategy to Save Lives, Expand Treatment, and Disrupt Trafficking; Actions Taken by the Biden-⁠Harris Administration to Address Addiction and the Overdose Epidemic; Colorado Springs LGBT Nightclub Shooting Leaves Five Dead and 25 Injured; Virginia Walmart Shooting Gunman “Was Picking People Out,” Witness Says; Opinion: Leaders Blamed the Uvalde Shooting on a Mental Health Crisis. Gun Violence Is Making That Crisis Worse; Nancy Pelosi Husband Attack Suspect David Depape Pleads Not Guilty To Federal Charges.

Amid these challenges, the NPRM proposes to implement this CARES Act mandate through the following changes to Part 2 that HHS says will help safeguard the health and outcomes of individuals with SUD while creating greater flexibility for information sharing envisioned by Congress in its passage of Section 3221 of the CARES Act:

Permit Part 2 programs to use and disclose Part 2 records based on a single prior consent signed by the patient for all future uses and disclosures for treatment, payment, and health care operations;
Permit the redisclosure of Part 2 records as permitted by the HIPAA Privacy Rule by recipients that are Part 2 programs, HIPAA covered entities, and business associates, with certain exceptions;
Expand prohibitions on the use and disclosure of Part 2 records in civil, criminal, administrative, or legislative proceedings conducted by a federal, state, or local authority against a patient, absent a court order or the consent of the patient;
Create two patient rights under Part 2 that align with individual rights under the HIPAA Privacy Rule:
- Right to an accounting of disclosures; and
- Right to request restrictions on disclosures for treatment, payment, and health care operations;
Require disclosures to the Secretary for enforcement;
Apply HIPAA and HITECH Act civil and criminal penalties to Part 2 violations;
Require Part 2 programs to establish a process to receive complaints of Part 2 violations;
Prohibit Part 2 programs from taking adverse action against patients who file complaints;
Prohibit Part 2 programs from requiring patients to waive the right to file a complaint as a condition of providing treatment, enrollment, payment, or eligibility for services;
Apply the standards in the HITECH Act and the HIPAA Breach Notification Rule to breaches of Part 2 records by Part 2 programs;
Modify the Part 2 confidentiality notice requirements (“Patient Notice”) to align with the HIPAA Notice of Privacy Practices;
Modify the HIPAA Notice of Privacy Practices requirements for covered entities who receive or maintain Part 2 records to include a provision limiting redisclosure of Part 2 records for legal proceedings according to the Part 2 standards; and
Permit investigative agencies to apply for a court order to use or disclose Part 2 records after they unknowingly receive Part 2 records while investigating or prosecuting a Part 2 program, when certain preconditions are met.

While the Department is undertaking this rulemaking, the current Part 2 regulations remain in effect. However, once the comment period ends, the Biden Administration-led HHS is expected to finalize the proposed changes quickly. Consequently, in addition to sharing any concerns or other input about the proposed changes during the comment period, health care providers, health plans, health care clearinghouses, employers, community agencies, state and local governments, patients and other caregivers and other concerned parties also should begin planning and preparing to respond to the anticipated changes in the requirements.

Implications For Businesses & Their Health Plans

Businesses should carefully assess the potential implications of the proposed changes on their worker and vendor credentialing and workplace safety practices as well as their health and other benefit programs. Assuming the changes are adopted in their current form, businesses sponsoring health benefit programs generally, and health care organizations and providers specifically should prepare to modify their HIPAA required notices of privacy practices and associated practices to comply with the proposed updates.

Businesses required to comply with Department of Transportation Drug Free Workplace or other alcohol and substance abuse requirements also should consider the potential implications of the proposed changes on their ability to secure relevant substance abuse treatment and related history. In assessing these implications, businesses also should be cognizant of a new proactivity on behalf of certain uses of drugs by workers in the workplace under the Americans With Disabilities Act (“ADA”). For instance, the EEOC recently has sued Eagle Marine Services Electrical & Refrigeration, LLC for allegedly violating the ADA by refusing to hire or accommodate a worker because he used medication prescribed by his doctor to treat attention deficit hyperactivity disorder (“ADHD”) without making any individual assessment of the worker’s medication use or whether it would affect his ability to safely perform the marine electrician position, and instead relied on general stereotypes about disability and medication use to justify its decision not to hire him. Businesses seeking to investigate or deny employment opportunities to workers based on the worker’s past or current medication use will want to use care to ensure that their practices are tailored to defend against similar challenges.

Health plan sponsors and insurers also should assure their mental health and substance abuse treatment coverage documents and practices are defensible under the latest mental health and substance abuse parity mandates of the Mental Health Parity and Addiction Equity Act (MHPAEA) and coverage requirements of the Patient Protection and Affordable Care Act (“ACA”). Along with a host of statutory changes since the original parity mandates took effect, implementing regulations and guidance about non-qualitative limitations and exclusions and heightened agency enforcement are ramping up enforcement and liability risks. In addition to exposing the health plan administrators and other fiduciaries to potential claims denial or fiduciary responsibility claims brought by participants or beneficiaries, the Department of Labor or both, administrative penalties by the EBSA, or both, the MHPAEA mental health and substance abuse parity rules are among 40 federal mandates that when violated can trigger the automatic $100 per violation per day employer excise tax penalty under Internal Revenue Code Section 6039D. As a consequence, violations of the MHPAEA are particularly risky and potentially expensive for private employers, their health plans and the plan administrators and fiduciaries that administer it.

For Help With Comments, Investigations Or Other Needs

If your organization would like to learn more about the concerns discussed in this update or seeks assistance auditing, updating, administering or defending its human resources, compensation, benefits, corporate ethics and compliance practices, or other performance related concerns, please contact management attorney and consultant Cynthia Marcotte Stamer.

Other Helpful Resources & Information

If you found this article of interest, you also may be interested in reviewing other Breaking News, articles and other resources available including:

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Posted by Cynthia Marcotte Stamer