MAY 23, 2013 • REPRINTS
The Society for Human Resource Management is hoping regulators overseeing the implementation of health care reform will reconsider how they define 90 days.
Under the Patient Protection and Affordable Care Act, employers would be forced to limit waiting periods before health benefits kick in for new employees to no more than 90 calendar days.
SHRM, in comments submitted to the government this week, pointed out that employers commonly offer coverage to workers starting on the first day of the month after 90 days of employment, or the first payroll period following some waiting period.
“Many small and medium employer plans would be out of compliance with the approach taken in the proposed regulations that would limit waiting periods to no more than 90 calendar days,” wrote Michael P. Aitken, SHRM’s vice president for government affairs.
Aitken noted that most smaller employers “simply do not have the staff nor resources to undertake the changes to processes, systems, communications, and other functions that would be needed to switch from current practice to a strict 90 calendar day waiting period at the same time as significant other changes must be implemented to comply with different [PPACA] provisions taking effect in 2014.”
In its effort, SHRM also said a three-month waiting period helps prevent adverse selection, where an individual accepts a position solely to obtain health insurance to cover a medical condition, which could “impose unfair risk on an employer.”
On May 28, 2013, the Treasury Department issued Circular Letter 13-02 informing a second extension of the period for adopting required amendments to qualified retirement plans and to file a request for a determination letter until April 15, 2014. This extension benefits employers who are up against the clock with regards to the previous deadline of June 30, 2013 to internally approve the required amendments in their pension plans.
Many private employers offer retirement plans to their employees and the majority of these plans are qualified under the Puerto Rico Tax Code. The Puerto Rico Internal Revenue Code was amended in January 2011, adopting new rules and requisites applicable to the qualified retirement plans. Under the new Code, employers generally had until December 31, 2012 to internally approve the changes to the plans and until April 15, 2013 (July 15, 2013 with an extension of time) to request a determination letter for the plan from the Treasury Department.
In November of 2012, Circular Letter 12-09 was issued extending the period to internally approve the required amendments in their pension plans until June 30, 2013 and to request a determination letter for the plans from the Treasury Department until September 30, 2013.
On May 28, 2013, a second extension was issued by Circular Letter 13-02 allowing until April 15, 2014 to internally approve the required amendments in their pension plans as well as to request a determination letter for the plans from the Treasury Department. The April 15, 2014 due date applicable to request a determination letter from the Treasury Department may be extended further until July 15, 2014 upon paying an additional fee of $150.
Please note that these deadlines are for employers whose tax year is based on a calendar year (January to December). If the employer or the plan’s tax year is different from a calendar year, the dates are different.
For the rules applicable to plans with a plan year other than a calendar year, please refer to
On May 29, 2013, Acts 22 and 23 were (PS 238 and PC 488) passed amending several statutes pertaining to employment discrimination and the protection of partners and/or couples under the Domestic Violence Act in both public and private sectors.  The purposes of these statutes are to broaden the provisions under Puerto Rico’s legal system to offer full protection and equal human rights in the workplace to every person, regardless of their sexual orientation, gender identity or domestic partner.
Up until now, there were persons that lacked legal protection against labor discrimination of private employers as well as Government agencies or offices.  The courts have also closed doors on claims of discrimination by reason of sexual orientation in the workplace.
Due to this rule of law, employees have not been able to take their claims before the Antidiscrimination Unit (ADU) or the Equal Employment Opportunity Commission (EEOC) based on sexual orientation or gender identity.
The statute establishes as public policy to reject discrimination by reason of sexual orientation or gender identity in employment, whether public or private, reaffirming that a human being’s dignity is inviolable and that all people are equal before the law.
The Act prohibits any employer from suspending, refusing to employ, dismissing or in any other manner or form harming a person due to any of the characteristics protected by the law.
Among others, the law amends several articles of Act No. 100 of June 30, 1959 to add sexual orientation and gender identity as a reason of discrimination in employment and prohibits an employer from discriminating against any employee or his/her employment conditions because of this.
Act 23 amends the Act for Prevention and Intervention with Domestic Violence to offer protection to all partners or couples regardless of their marital status, their sexual orientation or gender identity.
All government entities and agencies, etc. are ordered by this Act to conform their regulations to include these causes of discrimination and to prepare protocols of compliance,
education and training with regards to the public policy of eradicating every kind of discrimination in employment and to include the protection afforded to all partners or couples regardless of whether they are married or not, their sexual orientation or gender identity.  Private employers should also adopt measures to amend their rules, regulations, policies and protocols to include these amendments.
On May 7, 2013, the D.C. Circuit Court of Appeals issued an opinion vacating the National Labor Relations Board’s regulation requiring employers to post a notice advising employees of their rights under the National Labor Relations Act. The posting rule was published in the Federal Register on August 30, 2011 (Labor Watch No. 11, 2011) and has been on hold pending resolution of several court challenges (Labor Watch No. 7, 2012).
A three member panel of the Court held that the Board’s rule violated the free speech rights of employers under Section 8(c) of the Act and found all three of the rule’s enforcement mechanisms unlawful. The Court held that two of the rule’s enforcements mechanisms (that failure to post the notice could be considered an unfair labor practice and that such failure could be evidence of anti-union animus in a case involving other alleged violations) violate Section 8(c). In addition, the Court found that the third enforcement mechanism (if the employer failed to post the notice through inadvertence, the Board could extend the 6-month statute of limitations for filing a charge involving other unfair labor practice allegations against the employer) to be completely unsupported by any authority in the Act
The Court struck down the entire rule because it found that all its enforcement mechanisms are invalid. The Court found it unnecessary to reach the question of whether the Board has the authority to issue the rule. However, two of the three judges stated in a concurring opinion that they would also hold that the Board lacks the authority to issue the posting rule.
In April of last year a separate District Court ruled that the Board did not have the authority to issue the notice posting rule. The Board has appealed that decision to the Fourth Circuit. The questions regarding the Board’s posting rule have not been finally resolved so employers must remain vigilant for further developments. While these questions are being resolved, employers are not required to post a notice. However, federal contractors should be aware of their obligation to post a similar notice of employee labor law rights as required by Executive Order 13496.
On February 6, 2013, the US Department of Labor issued new Family and Medical Leave Act (FMLA) regulations which take effect on March 8, 2013. The new regulations implement several recent statutory expansions of the FMLA pertaining to protections for military family members and airline flight crews. The major changes regarding military care leave are:
   1. Clarify that qualifying exigency leave is available to family members of persons serving in the regular Armed Forces, National Guard or Reserves who are on active duty or called to active duty in a foreign country.
   2. Increase the maximum number of leave days from 5 to 15 that an eligible family member may take to spend time with a military member on short-term, temporary rest and recuperation leave during deployment.
   3. Parental care, a new category of qualifying exigency leave, has been added to the existing categories of leave. Parental care exigency leave may be utilized by military members to make arrangements for the care of parents who are incapable of self-care when the care is necessitated by the member’s covered active duty. Such care may include arranging for alternative care, providing care on an immediate need basis, admitting or transferring the parent to a care facility, or attending meetings with staff at a care facility.
   4. Military caregiver leave has been expanded to include leave to care for covered veterans who are undergoing medical treatment, recuperation or therapy for a serious injury or illness. (This includes care for a pre-existing injury or illness aggravated in the line of duty). A covered veteran is an individual who was discharged or released under conditions other than dishonorable in the five-year period prior to the date the employee’s military caregiver leave begins. The definition of what constitutes a serious injury or illness of a covered veteran is broad.
   5. Military caregiver leave may be supported by a certification from any health care provider as defined in the regulation, not just those affiliated with the Department of Defense, Veterans Administration or Tricare.
Changes regarding the computation and use of intermittent leave:
   1. The maximum increment for FMLA leave taken on an intermittent or reduced schedule basis is the shortest increment of time that the employer uses to account for other forms of leave, provided that it is not greater than one hour. The employer must allow FMLA leave to be used in at least one-hour increments and if it permits shorter increments for other types of leave, it must allow those shorter increments for FMLA leave.
   2. Employers who account for leave in varying increments at different times of the day or shift may also do so for FMLA leave, provided that they use the same increments for FMLA as the smallest one used for any other type of leave taken at the same time.
   3. An employer can only count FMLA leave that is actually taken and may not also include time that is worked for the employer, regardless of how the employer accounts for leave. For example, if an employee arrives twenty minutes late for a FMLA reason and is put to work, the employer can only count those 20 minutes towards FMLA leave regardless of how the employer accounts for leave (such as in one hour increments).
   4. Where it is physically impossible for an employee to commence or end work midway through a shift, the entire period that the employee is forced to be absent can be counted against the employee’s FMLA leave entitlement. This provision is to be applied in only the most limited circumstance, and the employer must restore the employee to the same or equivalent position as soon as possible.
   5. The regulations include a reminder to employers of their obligation to comply with the confidentiality requirements of the Genetic Information Non-discrimination Act (GINA) to the extent that records and documents created for FMLA purposes contain family medical history or genetic information. Employee records and documents relating to any medical certification or family medical history must be maintained as confidential medical records in separate files from the usual personnel files, and may only be disclosed under certain limited circumstances.
Finally, the new regulations create special rules for airline flight crew employees, including special hours of service requirement, method of calculation of leave and recordkeeping requirements.
In addition to the regulations, DOL has published an updated FMLA poster and has also updated several of its optional-use FMLA forms. The regulations went into effect on March 8, 2013. The poster can be found here:
** Disclaimer: The content of this Compliance Bulletin has been prepared for information purposes only. It is not intended as, and does not constitute, either legal or tax advice, or solicitation of any prospective client.