Education Matters: November 2024 by lcwlegal

Education Matters

Title ix

Plaintiffs Supplement List of California Schools and Colleges from Implementing 2024 Title IX Regulations.

Plaintiffs submitted a supplemental list of schools which added 61 colleges and universities, including eleven colleges and universities in California, to a list of institutions prevented from implementing the 2024 Title IX regulations due to ongoing litigation. Specifically, on November 12, 2024, Young America’s Foundation submitted a list of additional colleges and universities attended by its members to the federal court judge in Kansas who first issued the preliminary injunction against the 2024 Title IX regulations in July 2024. The court previously ruled that the Plaintiff organizations may continue to supplement this list in the future, so the injunction automatically applies to the additional colleges and universities.

The following California colleges and universities were added to the preliminary injunction list on November 12, 2024:

• California State University Maritime Academy (Vallejo, CA)

• Claremont Graduate University (Claremont, CA)

• Copper Mountain College (Joshua Tree, CA)

• Diablo Valley College (Pleasant Hill, CA)

• Modesto Junior College (Modesto, CA)

• Oxnard College (Oxnard, CA)

• Palomar College (San Marcos, CA)*

• San Joaquin Delta College (Stockton, CA)

• Santa Monica College (Santa Monica, CA)

• University of California – Davis (Davis, CA)

• University of San Diego (San Diego, CA)

Pursuant to federal court orders, the U.S. Department of Education is currently prevented from enforcing the 2024 Title IX regulations in the states of Alabama, Alaska, Arkansas, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, and Wyoming. The U.S. Department of Education is also currently enjoined from enforcing the 2024 Title IX regulations at the schools, colleges and universities on the list located on the U.S. Department of Education’s website. The list also includes hundreds of K-12 schools and districts in California.

According to the U.S. Department of Education, the 2024 regulations do not apply to the states listed above or any schools, colleges, and universities identified on the published list. Furthermore, the Department states that the 2020 Title IX regulations remain in effect for affected states and schools, colleges, and universities.

Next Steps

Liebert Cassidy Whitmore will continue to monitor litigation related to the 2024 Title IX regulations.

For now, California institutions affected by the preliminary injunction should follow their policies and procedures that comply with the 2020 Title IX regulations, and should be prepared to comply with the 2024 regulations because the injunctive orders are temporary, and litigation is pending. Additionally, California institutions should also comply with California law, which provide protections against sexual harassment and discrimination based on gender (including pregnancy status), gender identity, gender expression, and sexual orientation.

If your institution needs training or assistance with Title IX and compliance with overlapping federal and state law, including the implementation of policies, procedures, or forms, please contact our Los Angeles, San Francisco, Fresno, San Diego, or Sacramento office.

*Note: Palomar College was listed on the July 15 list; the injunction may have applied to Palomar College before the latest update.

Sanctuary Jurisdiction

California Community Colleges Reinforce Commitment to Sanctuary Jurisdiction Laws.

In a November 15, 2024 legal advisory, the California Community Colleges Chancellor’s Office reiterated the state’s commitment to protecting immigrants and ensuring a safe and inclusive environment for all, regardless of immigration status, amid concerns over potential changes to federal immigration policies under the incoming presidential administration.

The advisory reminds California’s community colleges of their ongoing obligations under Senate Bill (SB) 54 (California Values Act) and Assembly Bill (AB) 21, which limit cooperation with federal immigration authorities and protect individuals in California from undue immigration enforcement.

Governor Gavin Newsom has called for a special legislative session in December 2024 to explore additional state protections in response to federal policy changes.

SB 54: Limits on Cooperation with Immigration Enforcement.

SB 54 continues to prohibit local and state law enforcement, including community college police, from using public resources for immigration enforcement. Specifically, the law restricts community college police from:

• Investigating, interrogating, detaining, detecting, or arresting individuals by inquiring into an individual’s immigration status.

• Sharing non-public personal information, such as release dates or contact details, with immigration authorities.

• Assisting with federal immigration enforcement operations unless authorized by a judicial warrant or in cases involving serious criminal offenses.

SB 54 and the legal advisory also cover specific limits on cooperating with immigration enforcement efforts, and permissible cooperation provided they are also authorized by local policy.

AB 21: Protection of Personal Information and Student Rights.

AB 21 imposes specific obligations on community college districts to prevent student, staff, and faculty from participating in immigration enforcement efforts unless mandated by law. Some key provisions include:

• Community college districts must refrain from disclosing personal information about students, faculty, or staff unless there is consent or a judicial warrant, court order, or subpoena.

• Community college districts must advise all students, faculty, and staff to notify the office of the college district chancellor or president if an immigration officer is expected to enter or has entered the campus to enforce a federal immigration order.

• An immigration officer must present a judicial warrant to access nonpublic areas of the campus.

• In the event that an undocumented student is detained, deported, or unable to attend to their academic requirements due to an immigration enforcement action, community college districts must assist the student in retaining their educational benefits and reenrolling the student, if necessary.

Districts should work closely to review their policies, protocols and plans with key administrators and staff to prepare for impacts. LCW attorneys have experience supporting districts and campuses with lawful, practical planning.

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Employment

Leaking a Letter About Student Complaints and Disclosing Disability Accommodation Could Violate the Information Practices Act.

Blake Wentworth began working as an assistant professor in the South and Southeast Asian Studies Department at UC Berkeley (UCB) in 2012. His duties included teaching, research, and service to the department and the profession. In 2014, he disclosed to fellow professor, Jacob Dalton, and department chair, Jeffrey Hadler, that he was struggling with marital issues.

In November 2014, graduate student Erin Bennett made an informal complaint to Hadler that Wentworth made her uncomfortable. Hadler investigated and believed the issue was resolved. During the investigation, Wentworth confided to Hadler that he had bipolar II disorder.

In February 2015, Wentworth was hospitalized for mental health reasons but returned to work the following week. After Wentworth returned, he missed a week of classes without notice and failed to write a letter to nominate a potential graduate student for a university fellowship.

Hadler recommended that Wentworth consider requesting disability accommodations, which could include medical leave, a stoppage of his tenure clock, or proportional reductions in duties. Wentworth initially declined, stating that his issues stemmed only from his marital problems. However, in April 2015, he began the process of requesting a two-semester stoppage of his tenure clock as a disability accommodation. Wentworth did not produce his medical documentation until July, but when he did, UCB granted the accommodation. The medical documentation stated that Wentworth’s bipolar II disorder impaired his ability to conduct research.

By early April 2015, additional students complained about Wentworth’s behavior. One student, Kathleen Gutierrez, reported that Wentworth held her hand, cupped her ear, discussed his personal struggles, and told her he was attracted to her. She alleged that when she told him she was not interested, he implied he could be

helpful with her career. Other students complained that Wentworth discussed his martial, intimate, or sexual life during an independent study and graduate seminar. All students in Wentworth’s spring 2015 graduate seminar dropped the course and the University cancelled it. Faculty and students complained that Wentworth missed committee meetings, disparaged other faculty, discussed sexual acts, and praised drug use within earshot of undergraduates.

In October 2015, UC Berkeley’s Office for the Prevention of Harassment and Discrimination (OPHD) found that Wentworth’s behavior toward Gutierrez violated UCB’s sexual harassment policy. It also found that Wentworth’s conduct toward Bennett was unprofessional but did not constitute sexual harassment.

In early 2016, another student made sexual harassment allegations against Wentworth. Faculty members then sent a letter to Dalton, who had taken over for Hadler as department chair. The letter stated that there were multiple sexual harassment allegations against Wentworth and urged immediate action to enforce the faculty code of conduct. Somebody leaked the letter to a reporter.

In March 2016, The San Francisco Chronicle published an article detailing the complaints against Wentworth. The article quoted the letter and quoted faculty members who expressed frustration with UCB’s slow response. A few days later, Janet Broughton, the vice-provost for faculty, told the faculty that the publication of the letter violated confidentiality. The next day, another faculty member shared the letter with The Daily Californian, which then published its own article on the matter, naming Wentworth and quoting faculty and students.

Two weeks later, Dalton called a department meeting of faculty and students. Dalton said that 10 students had complained to OPHD about Wentworth. One person remarked that it had been obvious that Wentworth was “barely hanging on” and “couldn‘t deal with the stresses in his personal life.” Hadler responded that he had offered Wentworth paid medical leave but Wentworth had refused it. A faculty member e-mailed her meeting notes to a student to give to other students.

In May 2016, faculty investigators recommended Wentworth’s dismissal, citing sexual harassment, unprofessional behavior, and neglect of teaching duties. UCB sent a formal complaint to the academic senate’s committee on privilege and tenure.

In October 2016, Dalton recommended against renewing Wentworth’s appointment, based on the student complaints against him. He also noted Wentworth’s failure to fulfill teaching duties during the Spring of 2015. The dean agreed with Dalton’s recommendation not to reappoint Wentworth. The chancellor then denied reappointment, effective June 2018.

In April 2017, the academic senate concluded the disciplinary case against Wentworth. It found that Wentworth violated UCB’s sexual harassment policy and failed to be objective in his judgment of colleagues when advising students. The committee found these violations warranted dismissal. The committee found his lapses in teaching and service were significant but insufficient to breach the faculty code of conduct. In May 2017, the chancellor terminated Wentworth’s employment.

Wentworth filed a lawsuit against the UC Regents in September 2016. He brought six causes of action under that Fair Employment and Housing Act: (1) disability harassment; (2) disability discrimination; (3) retaliation; (4) failure to engage in the interactive process; (5) failure to provide reasonable accommodation; and (6) failure to prevent discrimination, harassment, and retaliation. Wentworth also alleged causes of action for (7) wrongful discharge under Labor Code section 1102.5; (8) failing to allow him to inspect and copy his personnel file, in violation of section 1798.34, Government Code section 31011, and Labor Code section 1198.5; and (9) invasion of privacy in violation of the California Constitution and Information Privacy Act (IPA). The IPA applies to state agencies and governs how public universities collect, store, use, and disclose personal information about students and employees.

The trial court granted Regent’s motion for summary judgment and dismissed Wentworth’s causes of action for failure to engage in the interactive process, failure to provide reasonable accommodations, and invasion of privacy. A jury ruled in favor of the Regents on the remaining causes of action. The trial court denied Wentworth’s request for attorney’s fees and costs. Wentworth appealed.

Wentworth argued that UCB failed to engage in a good faith interactive process and reasonably accommodate him. He argued UCB improperly delayed offering him an accommodation between February and July 2015, until he made a formal, written request. He also argued that UCB should have offered him the option of a research leave or active service modified duty, so that he would not need to teach and could focus on research and writing.

The court of appeal disagreed. It found that Regents engaged in the interactive process in good faith and reasonably accommodated the needs that Wentworth had identified. After Wentworth’s February 2015 hospitalization, Hadler met with Wentworth and suggested different accommodations, including taking a medical leave or stopping his tenure clock. Wentworth was the cause of any delays in the process. He was slow to submit his request for accommodation and medical records, but once he did, UCB granted his request. Wentworth’s medical documentation said his disability affected his ability to conduct research. Therefore, it would not make sense to place him on a research leave. Stopping Wentworth’s tenure clock was reasonable and gave him more time to perform the research needed before his mid-career review. It rejected Wentworth’s argument that he should have been allowed to progress toward tenure without fulfilling the research requirement, as research is an essential function of his role.

Wentworth also argued that the UCB should have excused his absences and failure to complete a nomination letter for a student because it stemmed from his disability. The court of appeal disagreed. It upheld the trial court’s finding that Wentworth’s disability was not a substantial motivating reason for UCB’s adverse actions, including disciplinary measures, denial of reappointment, and the recommendation for termination. It found that these actions did not constitute a failure to accommodate or engage in the interactive process.

Finally, the court of appeal found that UCB was not required to grant Wentworth a brief, excused absence in spring 2016 after the San Francisco Chronicle article was published.

Next, the court of appeal addressed Wentworth’s invasion of privacy claims. His claim focused on two incidents: the leaks of a March 2016 faculty letter to The San Francisco Chronicle and The Daily Californian, and disclosures made during the April 2016 department

meeting. At the meeting, Hadler and Dalton revealed that Wentworth had refused paid medical leave and that OPHD had investigated 10 student complaints against him. The trial court dismissed the invasion of privacy claim, finding the disclosures did not involve constitutionally protected confidential information. The court of appeal reversed, finding that triable issues of material fact existed for both the IPA and constitutional claims.

The court of appeal found that Hadler’s disclosure that he had offered Wentworth paid medical leave indirectly revealed that Wentworth had a serious medical condition, potentially a mental health condition. Dalton’s confirmation of 10 OPHD complaints constituted disclosure of personal employment information. The faculty member’s dissemination of the meeting notes to students further heightened the potential harm caused by these disclosures. The court of appeal determined that a reasonable jury could conclude these statements constituted an invasion of privacy under the IPA, as they included protected personal information about medical and employment history.

The court of appeal also concluded that the leaked March 2016 letter, which referred to student complaints, disclosed protected employment information. Although the letter did not name Wentworth, it was tied to media reports that identified him, and the information it contained was considered “personal information” under the IPA.

Under the IPA, disclosures must also cause an adverse effect to be actionable. The court determined that official confirmation of OPHD investigations and the offer of medical leave, even without explicitly mentioning a disability, could be inferred to cause reputational harm. It rejected the Regents’ argument that the information was already public, finding that official disclosures by university leaders could still have an adverse effect.

The court of appeal reversed the trial court’s summary judgment ruling, allowing the invasion of privacy cause of action to proceed to trial. Because of this partial reversal, the court of appeal also issued a remand to reconsider Wentworth’s request for attorney’s fees.

Wentworth v. Regents of University of California (2024) 105 Cal.App.5th 580.

student Disability

Ninth Circuit Finds California’s IDEA Nonsectarian Requirement May Violate Free Exercise Clause.

Three Orthodox Jewish families and two Orthodox Jewish schools filed a lawsuit challenging a California law that prevents religious schools from contracting with the state to provide government-funded disability services. The families included a 4-year old (M.L.) and two 14-year olds (K.T. and N.P.) and each of their parents. All three children have autism, and N.P. also has a genetic mutation causing speech delays, behavioral issues, and learning disabilities. The families believe their faith requires them to enroll their children in Orthodox Jewish religious schools to fulfill their duty to transmit Jewish religious beliefs and practices.

M.L. currently attends an Orthodox Jewish learning center, but his parents cannot afford speech therapy for him. K.T. and N.P. attend public schools in the Los Angeles Unified School District (LAUSD), which provide publicly funded disability services but lack religious instruction and impose additional burdens. K.T. faces challenges maintaining his kosher diet and observing religious holidays, while teachers have given N.P. non-kosher meals and he has faced resistance to observing Jewish holy days.

The Individuals with Disabilities Education Act (IDEA) is a federal law that ensures students with disabilities receive a free appropriate public education (FAPE). Districts provide tailored educational services to students with disabilities, governed by individualized education programs (IEPs). California contracts with certain nonpublic schools (NPSs) to serve students with disabilities. NPSs operate under strict state oversight and must adhere to California’s standards for curriculum, staff qualifications, and educational materials. Federal regulations allow states to contract with religious entities for services, provided these services are secular, neutral, and non-ideological. However, California requires that NPS be nonsectarian, regardless of the curriculum.

Public agencies may place students in either public schools or NPSs to carry out their EIPs. When a local educational agency places a child in an NPS, the agency is responsible for the full amount of the tuition. Parents may place their children in private schools without an individualized education program (IEP) and receive limited publicly funded “equitable services.” However, the IDEA does not obligate public agencies to fund their private school education if a FAPE is available in a public school.

The three families, and two Orthodox Jewish schools, sued the California Department of Education and its Superintendent of Public Instruction, Tony Thurmond (Department of Education), as well as the Los Angeles Unified School District and its Chief of Special Education, Equity, and Access, Anthony Aguilar (LAUSD). They argued that the nonsectarian requirement violates their constitutional rights under the Free Exercise and Equal Protection Clauses. The families and schools sought a preliminary injunction to prohibit the Department of Education from enforcing the nonsectarian requirement.

The district court dismissed the complaint due to lacked standing, and denied the plaintiffs’ motion for preliminary injunctive relief. It held that none of the plaintiffs had adequately alleged an injury that was traceable to the nonsectarian requirement or redressable by a favorable court decision. The Ninth Circuit partially reversed this decision, holding that N.P. and his parents did not have standing to challenge California’s nonsectarian requirement

under the Free Exercise Clause. However, it affirmed the district court’s dismissal of claims brought by the other families and the schools for lack of standing.

The Ninth Circuit found that the parents plausibly alleged that their Orthodox Jewish faith required them to enroll their children in religious schools, including those with disabilities. It found that California’s nonsectarian requirement disqualified religious schools from participating in the NPS program, effectively forcing families to choose between their religious beliefs and accessing publicly funded disability services. The Ninth Circuit found this imposed a significant burden on religious exercise, since it excluded religious schools solely based on their affiliation.

The Ninth Circuit determined that the nonsectarian requirement is not neutral toward religion because it singles out religious entities for exclusion. Therefore, strict scrutiny applies, which means the law must be narrowly tailored to achieve a compelling government interest. The Department of Education argued that the nonsectarian requirement advanced a compelling interest in neutrality to avoid Establishment Clause concerns. The Ninth Circuit rejected this argument, referencing recent Supreme Court rulings that rejected states’ efforts to impose stricter separation of church and state than required by the Constitution. The Department of Education failed to show that existing federal regulations prohibiting the use of public funds for religious instruction or worship were insufficient to address neutrality concerns. Furthermore, the Department of Education did not demonstrate that the nonsectarian requirement was narrowly tailored to address its interests.

The Ninth Circuit reversed the district court’s dismissal of the free exercise claims, vacated the denial of the motion for preliminary injunction, and remanded the case to the district court for further proceedings.

Loffman v. Cal. Dep’t of Educ. (9th Cir. Oct. 28, 2024, No. 23-55714) 2024 U.S. App. LEXIS 27265.

Negligence

California Universities Do Not Have Duty to Protect Students From Emotional Harm.

Before coaching at the University of California San Diego (UCSD), Geoff Bond was a rowing coach at the University of Pennsylvania (UPenn). During his time at UPenn, multiple members of the rowing team allegedly expressed concern about Bond’s coaching style and behavior, which included having an unfair selection process, sexually charged insults, ineffective training methods, and publicly shaming rowers that utilized UPenn’s psychological services.

B.L. enrolled at UCSD in the fall of 2019 and joined its men’s rowing team. B.L. was previously diagnosed with juvenile rheumatoid arthritis, gained thirty pounds in middle school, and struggled with obesity, a matter he discussed with his team and coaches. As months progressed, Bond allegedly engaged in “explosive behavior,” including making sexually inappropriate comments, and having unprovoked rage-filled outbursts.

In early January 2020, several women accused an athlete on the men’s rowing team, Z.B., of sexual harassment and assault. B.L. had multiple conversations with Bond about Z.B. because he was concerned by Z.B.’s continued presence on the team. B.L. subsequently decided to contact others at UCSD about the Z.B. matter. Thereafter, Bond verbally attacked B.L., shouting comments about B.L.’s weight and demoting him on the team.

B.L. met with associate athletic director Katie McGann about Bond’s behavior, and McGann told B.L. he could report the conduct directly to the Office for the Prevention of Harassment and Discrimination (OPHD) or see a therapist.

In April 2020, B.L. completed an anonymous survey for McGann about the men’s rowing team. B.L. complained about Bond’s failure to report the allegations against Z.B. to UCSD, Bond’s retaliatory conduct, and notified UCSD that he had fleeting thoughts of suicide throughout the process, but did not reveal them because he was afraid of the implications. McGann responded to B.L.’s survey and assured him that any issues reported to her were reported up the chain to OPHD properly.

In December 2020, B.L. informed Bond that he was opting out of the upcoming rowing season. On January 4, 2021, B.L. committed suicide.

B.L.’s parents filed suit in federal court against UCSD, McGann, and Bond alleging, among other claims, negligent hiring, supervision, and retention. The defendants moved to dismiss.

Under California law, to establish a cause of action for negligence, the plaintiff must show that the defendant had a duty of care, that he breached that duty, and the breach was the proximate or legal cause of the resulting injury. The threshold question for this case was whether the defendants owed a legal duty of care to the B.L. In general, there is not a duty of care to protect someone from harm at the hands of a third party. One exception is the special relationship doctrine, which often applies when someone relies on someone else for protection and that person has superior control over the means of protection.

B.L.’s parents argued that their negligence claim was not reliant on a special duty to prevent B.L.’s suicide. Rather that argued that McGann had a duty to protect B.L. from serious mental harm, which occurred when she negligently failed to discover Bond’s history of abuse and to discipline or investigate Bond after learning about Bond’s psychological abuse of B.L. and the sexual harassment of the rowing team.

The district court concluded that universities do have a special relationship with students while they are engaged in activities that are part of the school’s curriculum or closely related to its delivery of educational services. This includes athletic team settings. However, the special relationship does not mean UCSD must protect B.L. from all foreseeable injury. Based on current California precedent, the district court concluded that there is no duty that universities have to protect students from non-physical harm.

The district court considered a number of policy considerations in regulating student conduct. It noted that it used to be that universities stood in loco parentis, however, the current legal landscape has shifted to a “bystander” era, where the privacy and autonomy rights of adult students outweigh a college administrator’s authority to control student behavior. Imposing a duty on a university administrator to prevent emotional distress could threaten the independence and autonomy students seek. The district court considered that university employees might otherwise force students complaining of harassment to seek mental health treatment when other, less intrusive resources are available to address the harm (e.g., rules against harassment, reporting complaints to the harassment office, and accessible mental health services.) The district court also raised concerns about students’ privacy interests and the potential increased cost of tuition for universities to protect against liability for intangible harms.

For these reasons, the district court concluded that the university did not have a duty to protect its students from non-physical harm. The district court dismissed the negligence claims.

Lilly v. Univ. of Cal.-San Diego (S.D.Cal. Sep. 30, 2024) 2024 U.S.Dist.LEXIS 179075.

Note: This court had both parties prepare briefs on the specific issue of whether universities must protect students from nonphysical harm. This matter may be appealed, as California’s Supreme Court has not decided this issue. These obligations are also distinct from the K-12 setting, where schools do stand in loco parentis for students and have greater duties to protect students from non-physical harm.

LEGal updates

Notice of Proposed Rulemaking on Baccalaureate Degree Program.

The California Community Colleges, Chancellor’s Office has issued a proposed rulemaking titled “Baccalaureate Degree Program.” This proposed regulatory action seeks to formally establish community college baccalaureate degree programs within the California Code of Regulations and amend associated code sections consistent with the requirements of Assembly Bill 927 (Medina, 2021), which converted the baccalaureate degree program from a “pilot” status to an ongoing program.

The proposed regulations can be found on the Office of General Counsel page of the Chancellor’s website at Office of General Counsel – Pending Regulatory Action. Comments must be received by the Regulations Coordinator prior to 4:00 p.m. on December 21, 2024. Questions and comments should be emailed to regcomments@cccco.edu. A public hearing was scheduled to be held during the Board of Governors meeting on November 18, 2024.

Notice of Proposed Rulemaking on NextUp Program.

The California Community Colleges, Chancellor’s Office has issued a proposed rulemaking titled “NextUp Program.” This proposed regulatory action would amend sections 56400 through 56416 of Title 5 of the California Code of Regulations related to the NextUp Program (formerly known as the Cooperating Agencies Foster Youth Educational Support Program or “CAFYES”) consistent with recently-enacted legislation intended to expand and strengthen support for foster youth.

The proposed regulations can be found on the Office of General Counsel page of the Chancellor’s website at Office of General Counsel – Pending Regulatory Action. Comments must be received by the Regulations Coordinator prior to 4:00 p.m. on December 20, 2024. Questions and comments should be emailed to regcomments@cccco.edu. A public hearing was scheduled to be held during the Board of Governors meeting on November 18, 2024.

Notice of Proposed Rulemaking on Course Outline Record.

The California Community Colleges, Chancellor’s Office has issued a proposed rulemaking titled “Course Outline Record.” This proposed regulatory action updates California Community Colleges’ curriculum and course outlines of record to align with Vision 2030 and state laws AB 1111 (2021) and AB 1705 (2022). It requires curriculum committees to address equity, accessibility, and detailed course outline standards. It streamlines course approval processes, removes basic skills requirements, and implements common course numbering.

The proposed regulations can be found on the Office of General Counsel page of the Chancellor’s website at Office of General Counsel – Pending Regulatory Action . Comments must be received by the Regulations Coordinator prior to 4:00 p.m. on December 20, 2024. Questions and comments should be emailed to regcomments@cccco.edu. A public hearing was scheduled to be held during the Board of Governors meeting on November 18, 2024.

U.S. Department of Education Proposed Rulemaking to Authorize Debt Relief

Based on Hardship.

The U.S. Department of Education proposes to amend the regulations related to the Higher Education Act of 1965 to provide the waiver of certain student loan debts. The proposed regulations would clarify the use of the Secretary’s authority to waive all, or part of any student loan debts owed to the Department based on the Secretary’s determination that a borrower has experienced or is experiencing hardship related to such a loan.

The proposed regulation can be found on the Federal Register website. Comments regarding the proposed rule impact the William D. Ford Federal Direct Loan Program (Direct Loans), the Federal Family Education Loan (FFEL) Program, the Federal Perkins Loan (Perkins) Program, and the Health Education Assistance Loan (HEAL). Comments regarding the proposed rule must be made on or before Dec. 2, 2024, and via the Federal eRulemaking Portal at www.regulations.gov.

benefits Corner

New ACA Affordability Percentage for 2025 is 9.02 Percent.

The IRS has set the new Affordable Care Act (“ACA”) affordability percentage to 9.02% for 2025. This new affordability percentage is 0.63% higher than the current 2024 affordability percentage (from 8.39% to 9.02%).

While the Internal Revenue Code originally set the affordability threshold to 9.5%, the Internal Revenue Service (“IRS”) retains the authority to release an adjusted percentage each year. (See 26 U.S.C. § 36B(c)(2)(C)(i).)

From 2015 to 2022, the IRS set an affordability percentage above 9.5%, going as high as 9.86% in 2019. For 2023, the IRS dropped the affordability percentage below 9.5% for the first time by setting it at 9.12% and then dropped it even lower at 8.39% for 2024.

Applicable large employers are advised to check whether their offers of employer-sponsored health coverage are affordable using the 9.02% threshold. To determine whether an offer of health coverage is affordable, an employer must run an affordability calculation to determine whether an employee’s “Required Contribution” toward the premium for the lowest cost employee-only coverage exceeds or does not exceed 9.02% (2025) of the employee’s household income for the taxable year. Since employers typically do not know the total household income of each of their employees, the ACA provides three affordability safe harbor options an employer may adopt and apply on a reasonable and consistent basis:

1. Under the Form W-2 Safe Harbor, coverage is affordable if the employee’s Required Contribution is less than or equal to 9.02% of the employee’s wages reported in Box 1 of Form W-2.

2. Under the Rate of Pay Safe Harbor, coverage is affordable if the employee’s Required Contribution is less than or equal to 9.02% of the monthly wage

amount for hourly employees (the hourly rate multiplied by 130 hours), or the monthly salary for salaried employees.

3. Under the Federal Poverty Line Safe Harbor, coverage is affordable if an employee’s Required Contribution does not exceed 9.02% of the Federal Poverty Line for a single individual.

Please note that there are additional factors, such as health flex contributions and cash in lieu, that can greatly impact the amount of an employee’s Required Contribution and the affordability calculation. For more information about how to run the affordability calculation and whether your agency needs to revise its employer contribution to maintain affordable offers of health coverage, please reach out to us.

IRS Answers Questions About New Student Loan Matching Benefit.

The Setting Every Community Up for Retirement Enhancement (“SECURE”) 2.0 Act created a new benefit where employers can provide matching employer contributions to certain types of employer-sponsored retirement plans, including 457(b) and 403(b) plans, based on employee’s student loan repayments. Under this new benefit, as employees pay down their student loans, their employer will provide matching contributions to their retirement plan even if the employee is not making their own retirement contributions. The underlying purpose of these new student loan matching programs is to help employees who have student loan debt and who may not have the financial means to contribute to their retirement plan when they have to prioritize paying down student loans.

The IRS recently released Notice 2024-63, which provides interim Q&A guidance for employers about the student loan matching benefit. Here are the big takeaways from the Notice:

• A qualified student loan payment (QSLP) includes a loan to pay higher education expenses of the employee, the employee’s spouse, or the employee’s dependent.

• The employee must have the legal obligation to pay for the QSLP and must actually pay for the loan. If the employee is a guarantor on the loan, they do not have a legal obligation to pay for the loan unless the primary borrower defaults under the loan and would therefore, not be eligible for the student loan matching benefit.

• An employer cannot limit QSLP to only certain education loans. For example, an employer cannot limit the benefit to loans for an employee’s own education, for a particular degree program (e.g., Bachelor of Arts, Juris Doctor, or Master of Business Administration), or for attendance at a certain educational institution.

• Employers cannot add eligibility criteria for the student loan matching benefit that differs from the eligibility criteria for employees to receive elective deferral matches to the retirement plan or deferred comp plan. For example, an employer cannot require employees to remain employed through the QSLP match allocation date or through the last day of the plan year if that is not a condition for the employee to receive an elective deferral match to their 403(b) or 457(b) plan.

• Only an employee’s QSLP that was made during the plan year is eligible for the student loan matching benefit for that same plan year. The benefit cannot be provided in the current plan year for QSLPs that were made during a different plan year.

For more information, please see IRS Notice 2024-63 (Aug. 19, 2024), available at https://www.irs.gov/pub/irs-drop/n-24-63.pdf

Benefits Compliance Question.

Question: Is employer-provided cancer insurance excludable from an employee’s gross income?

Answer: No. A fixed-indemnity health insurance policy is an insurance policy that pays covered individuals a specified amount of cash for the occurrence of certain health-related events. Under many cancer insurance plans, employees pay premiums for coverage and then if a qualifying event occurs, employees received a fixed amount of benefit payments from the coverage. For example, participants could receive a fixed sum (e.g. $300) per day for hospital confinement. This tax issue with fixed indemnity plans is that the amount of the benefits paid are not related to the amount of any medical expense incurred. The IRS has determined that benefit payments under “an employerfunded, fixed-indemnity insurance policy (including where the premium for the coverage is paid by employee salary reduction through a cafeteria plan under section 125 of the Internal Revenue Code (Code)) are includible in the gross income of the employee if the employee has no unreimbursed medical expenses related to the payment.” Therefore, the cancer insurance is not excluded from the gross income if it is provided as a fixed indemnity plan. For more information, see IRS Office of Chief Counsel Memorandum, No. 202323006 (June 9, 2023), available at https://www. irs.gov/pub/irs-wd/202323006.pdf.

LCW Annual Public Sector Employment Law Conference

January 30-31, 2025

We're thrilled to announce that registration is open for the Annual LCW Conference taking place January 30-31, 2025, in San Diego!

The LCW Conference is California's premier public sector employment and labor relations educational event. Our speakers are California labor relations and employment law attorneys who have dedicated their careers to representing and supporting California's cities, counties, special districts, public safety agencies and public educational institutions.

When: January 30-31, 2025

Where: Hilton San Diego Bayfront One Park Boulevard

San Diego, CA 92101

Consortium Call Of The Month

Members of Liebert Cassidy Whitmore’s consortiums are able to speak directly to an LCW attorney free of charge to answer direct questions not requiring in-depth research, document review, written opinions or ongoing legal matters. Consortium calls run the full gamut of topics, from leaves of absence to employment applications, student concerns to disability accommodations, construction and facilities issues and more. Each month, we will feature a Consortium Call of the Month in our newsletter, describing an interesting call and how the issue was resolved. All identifiable details will be changed or omitted.

Question:

A Community College District client asked LCW how to calculate baby bonding leave if a classified employee takes the leave beginning of November through January. The client asked how they would address the week and a half closure during the Thanksgiving and winter holidays (November 28 to 29 and December 24 to January 1). They asked if the employee was entitled to extend his 12 weeks and/or 60 workdays of baby bonding leave.

Answer:

The LCW attorney responded that under both the FMLA and CFRA, if an employee is out on leave and a holiday falls within the week of their leave, the holiday has no effect on the employee’s leave. In other words, the Thanksgiving holiday does not reduce the employee’s leave. The entire week still counts towards the amount of leave used.

However, the winter break closure is treated differently. The period from December 24 to January 1 does not count against the employee’s use of FMLA and CFRA leave because the District is closed. Therefore, you would not count this period of closure against the employee’s FMLA/CFRA leave.