December Bulletin 2013 by MSEC

DECEMBER 2013

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Employment Law Changes for 2014 Tina Harkness, Membership Development

Reminder The December edition of MSEC’s Bulletin is condensed for the holidays.

Here is a brief summary of federal and state law changes and emerging trends in employment law for Arizona, Colorado, Montana, New Mexico, and Wyoming.

PPACA: Health care reform continues its rocky road to full implementation. In 2014, the individual mandate begins, requiring individuals to insure themselves and their dependents or pay a tax penalty. However, tax penalties for employers with 50 or more full-time equivalents who fail to offer required insurance are delayed until 2015. Individuals will begin coverage under insurance plans purchased through the exchanges, with subsidies paid for those who qualify. Fees to fund the Patient Centered Outcomes Research Institute (PCORI) and temporary reinsurance fees begin on each covered person. Plans can no longer have annual or lifetime limits on essential health benefits. Grandfathered plans must cover adult children up to age 26. Eligibility waiting periods can be no longer than 90 days. Wellness incentives may increase employee cost up to 30 percent of the premium cost of individual coverage, and up to 50 percent for tobacco cessation initiatives. Federal circuit court decisions on employers’ religious objections to the contraceptive coverage mandate seem poised for future U.S. Supreme Court review. Same-Sex Marriage: Federal agencies continue to unravel the myriad effects of the U.S. Supreme Court’s Windsor decision, which struck down the portion of the Defense of Marriage Act (DOMA) prohibiting same-sex spouses from accessing federal benefits including Social Security and tax benefits. Challenges to state DOMA-like laws are sure to follow in 2014, with one suit already filed in Colorado. Expect more states to consider legalizing

same-sex marriages or to pass laws allowing civil unions and domestic partnerships.

Criminal Records and “Ban-the-Box”: The controversy over the Equal Employment Opportunity Commission’s April 2012 guidance on employer use of arrest and conviction records goes on. Opponents argue that the guidance creates a new protected class of convicted individuals. In July 2013, nine attorneys general, including Colorado’s, sent a letter challenging the EEOC’s position in suits the agency filed against Dollar Stores and BMW alleging unlawful race discrimination for not hiring applicants with certain criminal convictions. In November 2013, the state of Texas filed suit asking the court to declare the EEOC’s guidance invalid. Meanwhile, “ban-the-box” legislation, restricting employers from asking about or using criminal conviction histories, continues to pass at the state and local levels. Multi-state employers need to educate themselves about the restrictions in states where they operate. The controversy has caused some employers to remove criminal conviction questions from their application forms and to start asking applicants these questions at the interview stage. Immigration: It looked like comprehensive reform had a chance to pass this year with bipartisan support and bills in both the House and Senate, but it appears to have stalled. Restrictions on Employer Access to Social Media: Expect states to continue passing laws limiting employers’ access to personal social media accounts of applicants and employees. While it is still safe to use publicly available information so long as it is relevant and not otherwise protected, many states now prohibit asking or requiring applicants or employees to Continued on next page

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grant access to their restricted social media sites. Colorado’s “Facebook law” prohibits employers from asking employees and applicants to disclose their login credentials, demanding changes in their privacy settings, or requiring them to add other employees as friends or contacts. Employers also cannot take adverse action against employees or refuse to hire applicants who exercise rights under this law. New Mexico enacted a similar law prohibiting employers from requesting, requiring, or demanding prospective employees to reveal passwords to access their social networking websites or profiles.

Restrictions on Use of Credit Information: Several states, including Colorado, have passed laws either restricting or prohibiting employers’ use of applicants’ and employees’ consumer credit information in employment. Colorado’s Employment Opportunity Act prohibits employers from using credit information unless they can show that credit is “substantially related” to the current or potential job.

Minimum Wage: Several states increased their minimum wage rates beginning January 1, 2014. Arizona’s and Montana’s minimum wage rates will increase to $7.90 per hour. Colorado’s rate will increase to $8.00 per hour, $4.98 for tipped employees. Marijuana: In addition to marijuana sold for medical use, on January 1, 2014, some dispensaries in Colorado will begin selling marijuana for recreational use. Employers do not, however, have to accommodate marijuana use in the workplace for either purpose and can still have and enforce policies prohibiting employees from being at work in an impaired condition and requiring drug testing. Vacation: Thanks to a law passed last summer, Wyoming employers no longer have to pay out vacation upon separation. Employers must have a clear, written policy to this effect, acknowledged in writing by employees.