New regulations reviewed at business relations group meeting

Janice B. Rockwell, a business and employment law attorney, helps employers understand changes

January 19, 2011|By DON AINES |
  • Bill Saxman with the Maryland Job Service talks with guest speaker Janice B. Rockwell after her presentation to employers at the Business Relations Group meeting held Wednesday morning at the Washington County Job Center.
By Yvette May, Staff Potographer

HAGERSTOWN — A new year means new federal and state laws with which employers must comply, including regulations for an alphabet soup of programs in health care, genetic information and employee credit checks.

"Legislative stuff can be a little tedious," Janice B. Rockwell, a business and employment law attorney, told about 30 employers Wednesday at the Washington County Job Center. She reviewed new regulations and the possible impact on employers at the quarterly business relations group meeting.

The Patient Protection & Affordable Care Act (PPACA) of 2010, the name of the federal health care law, originally required employers to report health care coverage costs on W-2 forms this year, but the IRS granted interim relief, making it optional until 2012, Rockwell said.

"The biggest fear of employees is that they will one day be taxed" on benefits, said Wendy Young, a human resources manager for Dot Foods. The company opted out of documenting the information this year because employees were uncomfortable with it, she said.

"The point is to become more aware of what health care costs are," Rockwell said of the rule, noting the benefits are not taxable.

The IRS delayed implementation because employers were confused and there was a need to draft detailed regulations, she said.

Several employers raised their hands when asked if flexible spending accounts (FSAs) were provided to workers for some medical expenses. New regulations mean some over-the-counter (OTC) medications will have to be prescribed by a physician to be reimbursable, and FSA and Health Reimbursement Account (HRA) debit cards issued to workers cannot be used at many drug stores.

"This is nuts," said Marjorie Garrett of AeroSys Inc., a manufacturer of air-conditioning equipment.

The aim might be to "discourage all the spending" on OTC medications, Rockwell said.

Social Security withholding taxes for employees have been reduced for one year from 6.2 percent to 4.2 percent under the new federal tax law. This provides employees an opportunity to increase pre-tax contributions to their 401(k) plans, Rockwell said.

The effective date for the Genetic Information Non-Discrimination Act (GINA) was in 2009, but the Equal Employment Opportunity Commission (EEOC) did not issue regulations until 2010 that took effect last week, Rockwell said. GINA prohibits employers acquiring or using genetic information about employees, applicants or their families from medical histories, genetic tests and other sources.

There are exceptions, such as the "water cooler" exception, where an employer is not in violation for inadvertently learning genetic information, as long as it is not acted upon, she said.

GINA requires employers to notify physicians not to pass on genetic information about employees when requesting information for medical leave or to determine a person's fitness for duty.

"That's going to create a lot of paperwork," said Starla Byers, a human resources officer for Horizon Goodwill Industries.

The Maryland General Assembly recently went into session, so Rockwell said it is uncertain what new state regulations might emerge. She did say that medical marijuana legislation could be re-introduced, as well as legislation limiting employers' use of credit checks.

"It's cumbersome to do business here," Garrett said of the business environment in the county.

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