Friday, February 19, 2016

The End of the Line?

For this session of the Maryland General Assembly…..

It looks like the last of the employment/workplace related legislation has been submitted before the 2016 session of the Maryland General Assembly. Although, it is still possible for a bill or two to slip through.

As far as submission of bills is concerned, it’s been another active session. It remains to be seen which of the many bills thrown against the wall will actually stick.

Here are the last few that I’m following:

SB 662 - Health Benefit Plans – Special Enrollment Period for Pregnancy

For small employer health benefit plans (currently less than 50 employees/covered) This bill will add special enrollment rights for pregnancy, including the pregnancy of an eligible employee’s spouse or dependent. It will allow for enrollment any time after the commencement of the pregnancy and be available for the duration of the pregnancy. Currently employees experiencing life status changes related to dependents (birth, adoption, foster placement, marriage) can enroll in health insurance plans outside of open enrollment periods. This bill will add pregnancy to the list of special enrollment rights, including the pregnancy of a dependent.

It is unclear how this will be reconciled with IRS rules and HIPAA special enrollment rights for Sec. 125 pre-tax plans, since those rules do not include pregnancy as a qualifying event. It is also unclear why this bill should be necessary with the individual mandate under the ACA. Except for some very narrow exceptions, all individuals are mandated by the ACA to be covered under a health insurance plan. Assuming this fact, there should be few individuals who are not covered at the time of the need, whether that need is pregnancy or some other health condition.

Rules and regulations concerning timing of enrollment in group plans seek to alleviate the negative effect of adverse selection (in this case, only enrolling in health insurance when an expensive need occurs). Since insurance carriers cannot predict such a risk if this bill passes, premiums will undoubtedly rise to cover the risk. Small employers especially can least afford this additional cost.

HB 1038 - Labor Organizations - Right to Work

Prohibits an employer or a labor organization from requiring, as a condition of employment or continued employment, an employee or a prospective employee to join or remain a member of a labor organization, pay charges to a labor organization, or pay a specified amount to a third party.

This bill basically prevents forced membership in a union, or the payment of maintenance fees, agency fees, etc. to a union by nonmembers.
I believe this is long overdue. Currently, something like 11% of employees nationwide are unionized – most of them being public employees. Twenty-six states (including Virginia and West Virginia) have right to work laws. The time has come to allow all employees in Maryland the right to decide. In addition, to deny citizens’ their rights as to which organizations they wish to belong, or wish to contribute, seems uniquely un-democratic and contrary to the premises on which our country was founded.

HB 1454 - Organ Donation Leave

This bill applies to businesses with 15 or more employees. It will require up to 30 days of paid organ donation leave within 12 months; and it cannot run concurrently with FMLA leave; the leave cannot affect accrual or eligibility for any other employer-provided benefit; and includes reinstatement rights.

HB 1454 extends FMLA-like benefits and protections (for organ donation) to employees of businesses not covered under the FMLA. It layers onto several other paid leave bills/requirements submitted this session. In addition, it gives additional protected and paid leave to employees covered under FMLA (which is unpaid leave).

HB 1293 - Break Time for Expression of Breast Milk by Employees – Requirement

Requires an employer to provide break time for an employee to express breast milk for a nursing child and provide a private space that the employee can use while expressing breast milk. This requirement extends for 1 year after the child's birth. The bill applies to businesses with under 50 employees (businesses with 50 or more employees are already required to provide this break time, due to an amendment of the FLSA that was part of the ACA).

Many employers of 50 or more employees find it difficult to provide the private space that meets the law, those under 50 will most likely find it even more difficult. In addition, there is no limit to the number of breaks, or the length of breaks.

To be very clear, no one I know or associate with is against giving employees flexibility and leave that benefits them – within the means of the business. However, the problem arises with legislated, mandated benefits that make no consideration to the size or nature of the business in any realistic way. I’ve said this before, many times, one size does not fit all.

The number of laws, both enacted and proposed (federal, state and local) concerning leave benefits in particular is astounding. It is already very difficult for many businesses of all sizes to comply with laws covering the same topic, but differing in requirements. Piling on requirement after requirement, after requirement will at some point cause a business to cut back somewhere else. Something has to give; something will suffer. It may be wages, it may be other employee benefits, and it may even be jobs. All businesses have to have more revenue that they do expenses. Unlike government, business cannot survive running a deficit for very long.

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