USA: Alliant’s Employee benefits Compliance & Fast Facts – February 24, 2017
March 3, 2017:
The following information was provided to us by Asinta Partner in the United States, Alliant.
Reporting Reminder – Deadline Approaching!
Despite the change in the white house, an executive order and rumors galore, the ACA is still in effect and reporting is still required! Applicable large employers must file 2016 IRS forms 1094 and 1095 or face significant penalties.
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A few important reminders:
- ALEs must complete Form 1095-C for each full-time employee regardless if they were eligible, enrolled or offered coverage.
- Self-funded plan sponsors must complete MEC reporting (Part III of Form 1095-C) for all employees and non-employees enrolled in the plan.
- Line 14 should not be left blank! Codes on line 14 represent the offer of coverage (if any) that was made to the employee for each month. If an employee was not employee or not eligible during a particular month, code 1H should be used.
- ALEs filing 250 or more 1095-C must file electronically
- Generally, each EIN within a controlled group will file its own 1094-C and corresponding 1095-Cs.
- Yes! Reporting is still required!
New Paid Sick Leave Rules in Arizona, Washington
Beginning July 1, 2017, Arizona employers are required to provide employees with earned paid sick time under the Arizona Fair Wages and Healthy Families Act. The law defines “employer” as any corporation, proprietorship, partnership, joint venture, limited liability company, trust, association, political subdivision of the state, individual or other entity acting directly or indirectly in the interest of an employer in relation to an employee, but does not include the state of Arizona, or the United States. Read the complete text of the initiative here.
The Industrial Commission of Arizona has released a poster that must be displayed in an area accessible to employees that summarizes key provisions, including:
- Exemptions from the Fair Wages and Healthy Family Act
- Earned Paid Sick Time Entitlement and Amount
- Earned Paid Sick Time Terms of Use
- Prohibition Against Retaliation and Discrimination
- Enforcement of the Fair Wages and Healthy
- Who to Contact for Additional Information Regarding the Act
You can access the poster here. You can access a series of FAQs on the law here.
Beginning January 1, 2018, every Washington employer must provide each of its employees paid sick leave (at the greater of the newly increased minimum wage or the employee’s normal wage). Employees will accrue at least one hour of paid sick leave for every 40 hours worked, and are authorized to use such leave for (among other things) an absence resulting from the employee’s mental or physical illness, injury, or health condition, or to allow the employee to provide care for a family member with a mental or physical illness, injury, or health condition. Note that the definition of family member is very broad, and includes spouses, registered domestic partners, children, siblings, parents, grandparents and grandchildren. Unused paid sick leave carries over to the following year, except that an employer is not required to allow an employee to carry over paid sick leave in excess of 40 hours. Click here to read the complete text of the initiative.
The proliferation of paid sick leave provisions is important for two reasons. First, it makes compliance difficult for employers that operate in different states (even different municipalities). These clients will likely want to consult with legal advisors on a streamlined strategy that can be applied uniformly to comply with the various leave provisions to which it may be subject. Second, paid leaves are generally hours for which an employee is “paid or entitled to payment,” meaning these hours are included when doing full-time status calculations for Pay or Play purposes. Feel free to get in touch with a compliance team member if you have additional questions.
FAQ of the Week
- We carved out our plan’s pharmacy benefits and are using a pharmacy benefits manager (PBM). Does the carved out pharmacy plan need an SBC?
- A pharmacy benefit plan is considered a group health plan under the applicable rules so an SBC is required. Fulfilling this requirement can be challenging with benefits such as carved out pharmacy plans, employee assistance plans (EAPs), and HRAs. The SBC guidance notes that with respect to “carve-out arrangements,” due to the administrative challenges of combining benefits packages, the agencies will consider the provision of multiple partial SBCs that, together, provide all the relevant information to be in compliance with the SBC content requirements. The guidance goes on to note that steps should be taken (such as a cover letter or a notation on the SBCs themselves) to indicate that the plan provides coverage through multiple arrangements and that individuals who would like assistance in understanding how these products work together may contact the plan administrator for more information (and provide the contact information). Often the entity administering the carve out plan will have prepared an SBC which can be combined with the other plan SBCs to meet this requirement.
Special thanks to Alliant for providing us with this content. If you have any questions regarding compliance in the United States, please get in contact with Alliant via their contact page here.