Federal Compliance Update

Federal: ACA Affordability Threshold Decreases for 2024 Plan Year

On August 23, 2023, the IRS announced that the Affordable Care Act (ACA) affordability threshold will be 8.39%, reduced from 9.12% in 2023, for plan years beginning in calendar year 2024 (after December 31, 2023). Under the ACA’s Employer Shared Responsibility provision (play or pay), large employers (those with an average of 50 full-time employees—including full-time equivalent employees—during the prior year) must either:

• Offer most full-time employees and their children minimum essential, minimum value coverage that is affordable at the employee-only level of coverage; or
• Make an employer shared responsibility payment to the IRS if at least one of their full-time employees purchases coverage on a Health Insurance Marketplace and receives a premium tax credit because their employer did not offer qualifying coverage.

Under the new threshold, to be affordable for the 2024 plan year, the employee’s required contribution to the plan cannot be more than 8.39% of their income.

Read more about affordability and minimum value on the IRS’s Questions and Answers on Employer  Shared Responsibility Provisions Under the Affordable Care Act page.

IRS Revenue Procedure 2023-29 will be published in Internal Revenue Bulletin 2023-37 on September 11, 2023.

New Form I-9 and Remote Verification Procedure Rolled Out Updated Form I-9

A new Form I-9 (Rev. 08/01/23) will be available for employers to use on or after August 1, 2023, and once released can be found on the USCIS website. Employers can also order paper copies if they don’t want to use the electronic version. The version date, noted in parenthesis, can be found in the bottom corner of the Form I-9.

The prior version of Form I-9 (Rev. 10/21/19) continues to be effective through October 31, 2023. Beginning November 1, 2023, only the Form I-9 (Rev. 08/01/23) will be accepted. Employers shouldn’t complete the new Form I-9 (Rev. 08/01/23) for current employees who already have a properly completed Form I-9 on file, unless reverification applies after October 31, 2023.

The overhaul to the Form I-9 is quite extensive and includes the following changes:

• Section 1, Preparer/Translator Certification, is now a standalone document (Supplement A) that employers can provide to employees when necessary.
  
• Section 3, Reverification and Rehire, is now a standalone document (Supplement B) that employers can use if reverification is required.
• The Form I-9 can now be filled out on tablets and mobile devices as well as easily downloaded.
• The term “alien authorized to work” in Section 1 has been replaced with “noncitizen authorized to work.”
• The Lists of Acceptable Documents page now includes acceptable receipts, as well as guidance and links to information on automatic extensions of employment authorization documents.
• A box has been added that eligible employers need to check if the Form I-9 documentation was examined using the new alternative verification procedure.
• The instructions have been, mercifully, reduced from 15 pages to eight.

Action Item

By November 1, 2023, ensure that you’re using the new Form I-9 (Rev. 08/01/23) for all new hires and reverifications.

Remote Verification, aka “Alternative Procedure” for Form I-9 Verification

Qualified employers are allowed to conduct Form I-9 remote documentation verification for any employee hired on or after August 1, 2023. Employers need to follow specific steps to remotely verify Form I-9 documents—USCIS has dubbed this the alternative procedure.

If an employer offers the alternative procedure at a particular hiring site, it needs to be offered to all employees at that site. There is an exception, however, if employers want to offer the alternative procedure only to remote employees and do in-person inspection for onsite and hybrid employees. Employers can’t choose when to use remote or in-person verification based on a person’s or group of employees’ citizenship or immigration status, national origin, or any other protected characteristic.

The Meaning of Qualified Employer

Qualified employers are those that are participants in good standing in federal E-Verify. Employers are in good standing if all of the following are true:

• They have enrolled in E-Verify for all hiring sites in the United States that use the alternative procedure.
• They are compliant with all E-Verify program requirements.
• They continue to be enrolled in E-Verify and in good standing at any time when they use the alternative procedure.

Alternative Procedure Steps

An employer needs to take the following steps within three business days of an employee’s first day of employment:

1. Receive and examine copies of the employee’s Form I-9 documents (or an acceptable receipt) and determine if the documents appear to be genuine. If the documents are two-sided, employers need to examine copies of both the front and back.
2. Conduct a live video meeting with the employee. The employee needs to bring the same documents that they sent to the employer so the employer can ensure that they reasonably appear to be genuine and relate to the employee.
3. Check the box on Form I-9 (Rev. 08/01/23) that an “alternative procedure” was used to examine documentation to complete Section 2 or reverification. If an employer is using the old form (Rev. 10/21/19) they should write “alternative procedure” in the Additional Information field in Section 2.
   
4. Retain clear and legible copies of all documents that the employee sent to complete Form I-9, regardless of whether the documents are from List A, List B, or List C.

Employers can’t require employees to use the alternative procedure if they don’t want to and will need to perform an in-person examination for those unable or unwilling to participate in the remote verification process. This could arise when new employees don’t have access to the necessary technology or are uncomfortable transmitting sensitive personal information electronically, particularly if the employer hasn’t provided a secure way for them to do so.

The Alternative Procedure and COVID-19 Flexibilities

Qualified employers can use the alternative procedure to satisfy the requirement to physically examine Form I-9 documentation that was examined remotely under the COVID-19 flexibilities, but only if all of these conditions are met:

• They were enrolled in E-Verify at the time the remote examination for a new hire or a reverification occurred
• They created an E-Verify case for the employee, except in the case of a reverification
• They performed the remote inspection between March 20, 2020, and July 31, 2023

Employers should follow the alternative procedure steps and write “alternative procedure” and the date of the live video meeting on the Form I-9 in Section 2 in the Additional Information box or the section used for reverification, whichever applies. They should not create a new case in E-Verify.

Action Item

If you aren’t using E-Verify but want to utilize the alternative procedure, begin the enrollment process now. You can start by seeing what’s needed to enroll here.

Federal: EEOC Updates ADA Guide

On July 26, 2023, the U.S. Equal Employment Opportunity Commission (EEOC) updated its Visual  Disabilities in the Workplace and the Americans with Disabilities Act guide that explains how the Americans with Disabilities Act (ADA) applies to job applicants and employees with visual disabilities. It outlines when an employer may ask an applicant or employee questions about their vision, how an employer should treat voluntary disclosures about visual disabilities, and what types of reasonable accommodations those with visual disabilities may need in the workplace.

The updated guide also:

• Highlights new technologies for reasonable accommodation and how using artificial intelligence and algorithms to make employment decisions can impact individuals with visual disabilities;
• Addresses how an employer should handle safety concerns about applicants and employees with visual disabilities;
• Addresses how an employer can ensure that no employee is harassed because of a visual disability; and
• Discusses harassment and retaliation.

The EEOC’s disability discrimination landing page provides more information about disability discrimination, and the Job Accommodation Network (AskJAN) is a resource for workplace accommodations.

NLRB Reverses Decades-Old Policy, Making Unionization Without Election Easier

On August 25, 2023, the National Labor Relations Board (NLRB) issued a significant decision that facilitates the process of unionizing workplaces without the need for traditional elections. This decision marks a reversal of a policy that had been eliminated more than 50 years ago. Under this new policy, businesses found guilty of labor law violations are now required to engage in negotiations with unions without the formalities of an election.

The NLRB's updated standard mandates that employers acknowledge a union's presence based on a demonstration of majority support or through a petition requesting an election. Employees have the option to showcase majority support by endorsing authorization cards or using alternative methods.

These agreements are established outside the conventional NLRB framework. The initiation of this process requires employees to submit an election petition to their local NLRB office, demonstrating that at least 30% of employees are in favor of the petition. Petitions meeting the criteria and remaining unwithdrawn or undismissed lead to an NLRB-administered election, with the ultimate decision being determined by a majority vote.

This groundbreaking NLRB decision to permit workers to unionize without a formal election comes into play when employers are found to have committed unfair labor practices that impede workers' rights to join or establish a union. Consequently, the rule empowers the NLRB to mandate employers to negotiate with unions without the necessity of a formal election. This can occur if the union successfully demonstrates that a majority of workers have endorsed unionization through signed cards or petitions— a process known as the "card check" method. The basis for this rule stems from the Joy Silk doctrine, initially established by the NLRB in 1949 but later abandoned during the early 1970s.

Anticipated to work in favor of unions, this rule is projected to alleviate the delays and obstacles often employed by employers to hinder or dissuade workers from pursuing unionization. Despite the potential benefits, critics contend that the card check process might be susceptible to misuse and lacks the safeguards inherent in secret ballot elections.

State Compliance Update

Colorado Updates—Sick Leave, Discrimination, Harassment, and Recordkeeping: Compliance Reminder

The following changes to Colorado employment law apply to employers of all sizes. While our math indicates that these laws take effect August 8, the state legislature’s website says they are effective August 7, 2023.

Paid Sick Leave Uses Expanded

The reasons that employees can use paid sick leave under the Healthy Families and Workplaces Act (HFWA) have been expanded. The HFWA applies to all employers regardless of size and covers all employees (except for certain railroad employees).

Employees can use paid sick leave for the following additional reasons:

• To attend a funeral or memorial service, to grieve, or to manage financial and legal matters that arise after the death of a family member
• To care for a family member whose school or place of care has closed due to inclement weather, loss of utilities, or other unexpected occurrence resulting in the closure
• To evacuate their residence due to inclement weather, loss of utilities, or other unexpected occurrence resulting in the need to evacuate

Action Items

On or before August 7, 2023:

• Update your paid sick leave policy to reflect these new uses
• Display the updated notice from the Colorado Department of Labor in a conspicuous location in the workplace
• Provide the updated notice to current employees, and add it to your new hire packets

Marital Status Protected

Colorado’s antidiscrimination law has been expanded to include marital status as a protected characteristic. This means that employers should not inquire about an applicant’s or employee’s marital status or use that information when making employment decisions.

Action Item

Add marital status as a protected characteristic in your equal employment opportunity (EEO) policies if it’s not already included.

A Broader Definition of Harassment

Colorado has created its own definition of harassment. While it closely resembles the federal definition, the state law does not require that unwelcome conduct be “severe or pervasive” to rise to the level of being unlawful. These changes expand the scope of conduct that might be considered harassment and make state law more protective than federal law. Employers should keep this in mind when investigating and responding to complaints.

New Recordkeeping Rules

Employers must retain all personnel or employment records for at least five years after the latest of the following:

• The date that the employer created or received the record
• The date of the personnel action that the record relates to
• The date of the conclusion of any discrimination charge or related action

A personnel or employment record includes requests for accommodation, employee complaints of discrimination or unfair employment practices (both written and oral), applications for employment, and any other records related to hiring, promotion, demotion, transfer, layoff, termination, compensation, or selection for training or apprenticeship, and records of training provided to employees.

Harassment and Discrimination Complaints

Employers need to keep a designated recordkeeping system of all complaints (written and oral) of discrimination, harassment, and unfair labor practices. Each record must include the following information:

1. The date of the complaint.
2. The identity of the complaining party (if the complaint wasn’t anonymous).
3. The identity of the employee who allegedly harassed or discriminated against the alleged victim.
4. The substance of the complaint.
   

Compliance Calendar

September

09/30 – Summary Annual Report (SAR) Deadline (calendar year plans)

09/30 – VETS-4212 Filing Deadline (federal contractors)

October

10/2 – QSEHRA Notice Deadline (Calendar Year Plans Only) 1014 – Medicare Part D Creditable/Noncreditable Coverage Notice 10/30 – Form 941 Filing Deadline (third quarter)

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