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HR Matters
HR Matters October 2007 - Volume XI, Issue 126
October 31, 2007
LABOR & EMPLOYMENT NEWS
New Pregnancy Leave Regulations Closer To Being Law. In the August edition of HR Matters, we informed you that the Ohio Civil Rights Commission was considering new pregnancy leave regulations. Last week, the OCRC approved new regulations that would require all Ohio employers with 4 or more employees to offer 12 weeks of unpaid maternity time off of work. This provision is much more generous than the FMLA because it applies to large and small employers and does not require that the employee have worked at the company for one year and 1250 hours over the past year as is required by the FMLA. The regulations must go through a legislative committee before taking effect. If the new regulations do take effect, they will have a major impact on all Ohio employers. We will update you as more information becomes available.
Employee Could Not Perform Job, But FMLA Retaliation Claim Stands. A hairstylist at a Supercuts store suffered an off-duty knee injury that kept her from working. The hairstylist alleged that her supervisor openly displayed animosity concerning her leave. Two days before the hairstylist was scheduled to return to work from her extended FMLA leave, she gave her employer a medical certification form which stated that she was unable to perform required job duties (e.g., continuous standing). The employer terminated the hairstylist the day she was to return to work. The hairstylist filed a law suit alleging many claims, including FMLA retaliation. The district court dismissed the hairstylist’s claims, because she was unable to fulfill her job responsibilities by her scheduled return date. On appeal, the Sixth Circuit reversed, concluding that the hairstylist made out a prima facie case of FMLA retaliation. The court explained that allegations of retaliatory discharge turn on the employer’s motive, and here, the evidence showed that the employer’s motive existed well before the employer’s proffered reason for the hairstylist’s discharge. (Bryson v. Regis Corp .)
WORKPLACE HEALTH & SAFETY NEWS
“Employer’s Consent to Dismissal of Court Appeal” Amendment Held Not Retroactive. The 2006 amendment to Ohio Revised Code § 4123.512, effective June 30, 2006, requires employers to consent to any dismissal by the employee/claimant of the employer’s appeal. Previously, pending an appeal by an employer, the workers’ compensation suit could be dismissed, and reintroduced within the year, with the effect that the employer could be required to pay workers’ compensation benefits during the interim. Recently, the retroactivity of this amendment was addressed by a Court of Common Pleas in Lucas County, in Martin v. Omnisource Corp. Generally, statutes are prospective, and only apply to claims arising after the effective date and are only applied retroactively when the legislature explicitly provides for the statute to relate back to earlier claims. The Martin court found that since the amendment was not explicitly made retroactive, it did not apply to court appeals with respect to workers’ compensation claims arising before June 30, 2006.
IMMIGRATION NEWS
The Diversity Visa (DV) 2009 Lottery online entry began on October 3, 2007, and ends at Noon EST on December 2, 2007. The Department of State annually holds the Diversity Visa program (also known as the Green Card Lottery) where 55,000 green cards are awarded by random computer selection. Foreign nationals who are natives of certain eligible countries, as determined by the United States Customs and Immigration Service according to a mathematical formula based upon population totals and totals of specified immigrant admissions for a 5-year period, and who meet other eligibility requirements are permitted to apply this year between now and December 2. To find out more about the program and to submit your application electronically, see the government's website at www.dvlottery.state.gov.
EMPLOYEE BENEFITS & EXECUTIVE COMPENSATION
401(k) Fee Disclosure. Disclosure of 401(k) fees is a popular issue in courts, Congress, regulatory agencies and the media. As of June 2007, approximately 14 fee litigation cases were pending in federal courts. These lawsuits were filed against large U.S. companies alleging violation of fiduciary duties in connection with compensation arrangements commonly referred to as “revenue sharing.” Revenue sharing is the practice in which investment providers (such as mutual fund companies or insurance companies) allocate a portion of their fees to other plan service providers (such as record-keepers, trustees and plan administrators). Fee disclosures have caught the attention of Congress, where a bill has been introduced which would, among other things, require plan sponsors to disclose, in clear and simple terms, all fees charged each year. Also, the Department of Labor has indicated its intention to regulate the way revenue sharing arrangements are disclosed. The resolution of this issue is unclear, but plan sponsors can take steps to better clarify and understand their fee arrangements with service providers so as to be able to demonstrate their upholding of fiduciary obligations. First, look at your contractual arrangements, know what fees you are paying, and to whom, and to what extent any revenue sharing arrangements exist. Second, compare the fees to the marketplace to ensure the fees are reasonable.
2008 Plan Limits. The IRS recently announced the cost-of-living adjustments for the 2008 calendar year. Attached is a chart showing the applicable dollar limitations for 2008 and the corresponding 2007 amounts.
Elective Deferral Annual Limits
-401(k), 403(b) and SEPs: 2008-$15,500 2007-$15,500
-457 Plans: 2008-$15,500 2007-$15,500
-Simple IRAs and 401(k)s 2008-$10,500 2007-$10,500
"Catch-Up" Contributions
-401(k), 403(b) and SEPs: 2008-$5,000 2007-$5,000
-Simple IRAs & 401(k)s: 2008-$2,500 2007-$2,500
Maximum Annual Plan Compensation Limit: 2008-$230,000 2007-$225,000
415 Annual Additions
-Defined Benefit Plan Dollar Limit: 2008-$185,000 2007-$180,000
-Defined Contribution Plan Dollar Limit: 2008-$46,000 2007-$45,000
Key Employee (Top Heavy)
-Officers: 2008-$150,000 2007-$145,000
-1% Owner: 2008-$150,000 2007-$150,000
IRAs
-Annual Contribution Limit: 2008-$5,000 2007-$4,000
-Catch-up Contribution Limit: 2008-$1,000 2007-$1,000
Social Security Taxavle Wage Base: 2008-$102,000 2007-$97,500
Health Savings Accounts
-Individual Contribution Limit: 2008-$2,900 2007-$2,850
-Family Contribution Limit: 2008-$5,800 2007-$5,650
-Catch-up Contributin Limit: 2008-$900 2007-$800
This Newsletter is a periodic publication of Graydon Head & Ritchey LLP and should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general information purposes only, and you are urged to consult your own advisor concerning your situation and any specific legal question you may have.