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Disability

This is the Disability category of the Broad REach Benefits blog. At Broad Reach Benefits, we focus on employers that have between 30 and 500 benefit eligible employees. We’re employee benefit specialists, not a big box brokerage firm or payroll company with a sales force peddling policies.

Fair Employment – Equal Pay Laws For New Jersey

The federal Equal Pay Act (EPA) requires that men and women receive equal pay for equal work in the same establishment. In addition to the federal EPA, many states, including New Jersey, have enacted their own equal pay laws prohibiting wage discrimination based on gender and other characteristics.

This Employment Law Summary provides an overview of New Jersey’s Diane B. Allen Equal Pay Act (NJEPA), which prohibits certain pay differentials between men and women, and the Law Against Discrimination (LAD), which was amended by the NJEPA to expand protections against unequal pay based on various protected traits.

COVERED EMPLOYERS

The NJEPA applies to virtually all employers in the state, other than nonprofit hospital associations or corporations, and generally protects all employees, both male and female. However, it does not protect volunteers providing service for a nonprofit organization, farm workers, or domestic servants in a private home or hotel.

The LAD is a broader anti-discrimination law that prohibits a variety of entities, including all employers with one or more employees in the state (other than employers of domestic servants), from discriminating in compensation or against employees or job applicants based on any of several characteristics.

PROHIBITED PAY PRACTICES

The NJEPA prohibits employers from discriminating in any way in the rate or method of payment of wages to any employee based on sex. In addition, the LAD prohibits employers from discriminating against employees or applicants in compensation or the terms, conditions or privileges of employment based on any of the following, which are known as protected traits:

  • Race (including “traits historically associated with race,” such as hair texture, hair type and protective hairstyles);
  • Color;
  • Age (18+);
  • Sex (including pregnancy or breastfeeding);
  • Affectional or sexual orientation;
  • Gender identity or expression;
  • Creed/religion;
  • Marital status;

    • …

By |March 3rd, 2024|Broad Reach Benefits, Disability, Employee Benefits, Employee Communications, Human Resources, Legislation, U.S. Department of Labor|Comments Off on Fair Employment – Equal Pay Laws For New Jersey
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The Differences Between Short- and Long-term Disability Insurance and COBRA

Voluntary benefits are becoming increasingly important to employees as they focus on their physical, mental, social and financial health. As a result, many employers have expanded their voluntary benefits offerings to address employees’ needs and improve their attraction and retention efforts.

Among these offerings are disability benefits, which can provide guaranteed income or job protection to employees who are unable to work due to serious illness or injury. The most common disability benefits are short-term disability (STD) and long-term disability (LTD) insurance. However, understanding the differences between STD and LTD benefits and other laws, such as the Consolidated Omnibus Reconciliation Act (COBRA), can be complicated and difficult for employers to navigate.

This article provides a general overview of STD, LTD and COBRA and explores how both types of disability insurance differ from COBRA.

What Are STD and LTD?

STD and LTD insurance are the most common forms of disability benefits.

Short-term Disability Insurance

STD insurance replaces all or a portion of an employee’s income due to a temporary disability. Under STD plans, employees receive a percentage of their income, typically 40% to 70% of their base pay, but employers can allow employees to supplement their STD benefits with paid sick leave or other benefits. An STD insurance policy is paid either fully or partially by the employer, and the median length of

STD insurance coverage is 26 weeks, according to the U.S. Bureau of Labor Statistics.

To qualify for STD insurance, an employee files a claim under their insurance policy. The employee must prove their illness or injury qualifies as a disability under the plan’s terms. STD insurance generally requires employees to wait for a short period—on average, seven days—before they start receiving benefits to discourage abuse and because many …

By |June 19th, 2023|Broad Reach Benefits, Disability, Employee Benefits, Employee Communications, Human Resources, Long Term Disability, Voluntary Benefits|Comments Off on The Differences Between Short- and Long-term Disability Insurance and COBRA
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IRS Releases Final Rules Extending Deadline to Furnish ACA Reporting Forms

On December 12, 2022, the IRS released a Final Rule providing for, among other things,  an automatic 30-day extension of time for applicable large employers (“ALEs”) to furnish annual Forms 1095-C to individuals for calendar years beginning after December 31, 2022. The Final Rule is substantially consistent with the proposed rule issued by the IRS in November 2021 which employers were permitted to rely upon for their calendar year 2021 Forms 1095-C (which were due in 2022).

Prior to the IRS releasing its proposed rule last year, the IRS could grant an extension of time of up to 30 days to furnish Forms 1095-B and 1095-C to individuals for good cause shown; however, recognizing the January 31 deadline was difficult to meet, the proposed rule eliminated the good cause shown standard and simply allowed for an automatic 30-day extension to furnish the forms to employees.  The Final Rule does the same and, consistent with the proposed rule, provide that in years where the deadline falls on a weekend or holiday, the forms are due the next business day.

The deadline to file the Forms 1094-B or C and 1095-B or C with the IRS are not extended and will remain February 28 for paper filings and March 31 if filed electronically, though pursuant to current regulations, companies may receive an automatic 30-day extension of time to file the forms with the IRS by submitting Form 8809, Application for Extension of Time to File Information Returns, on or before the due date for filing the forms.

Additionally, because the penalty for the individual mandate is currently $0, for any calendar year in which it remains $0, the Final Rule provides relief (consistent with relief provided for tax years …

By |December 21st, 2022|Broad Reach Benefits, Compliance, Disability, Employee Benefits, Human Resources, IRS, Legislation, Voluntary Benefits|Comments Off on IRS Releases Final Rules Extending Deadline to Furnish ACA Reporting Forms
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Legal Alert- IRS Issues Affordability Percentage Adjustment for 2022

The Internal Revenue Service (IRS) has released Rev. Proc. 2021-36, which contains the inflation adjusted amounts for 2022 used to determine whether employer-sponsored coverage is “affordable” for purposes of the Affordable Care Act’s (ACA) employer shared responsibility provisions and premium tax credit program. As shown in the table below, for plan years beginning in 2022, the affordability percentage for employer mandate purposes is indexed to 9.61%.  Employer shared responsibility payments are also indexed.

Code Section 4980H(a) 4980H(b) 36B(b)(3)(A)(i)
Description Coverage not offered to 95% (or all but 5) of full-time employees. Coverage offered, but unaffordable or is not minimum value. Premium credits and affordability safe harbors.
2022* $2,750 $4,120 9.61%
2021 $2,700 $4,060 9.83%
2020 $2,570 $3,860 9.78%
2019 $2,500 $3,750 9.86%
2018 $2,320 $3,480 9.56%
2017 $2,260 $3,390 9.69%
2016 $2,160 $3,240 9.66%
2015 $2,080 $3,120 9.56%
2014** $2,000 $3,000 9.50%

*Section 4980H(a) and (b) penalties 2022 are projected.

**No employer shared responsibility penalties were assessed for 2014.

Under the ACA, applicable large employers (ALEs) must offer affordable health insurance coverage to full-time employees. If the ALE does not offer affordable coverage, it may be subject to an employer shared responsibility payment. An ALE is an employer that employed 50 or more full-time equivalent employees on average in the prior calendar year. Coverage is considered affordable if the employee’s required contribution for self-only coverage on the employer’s lowest-cost, minimum value plan does not exceed 9.61% of the employee’s household income in 2022 (prior years shown above). An ALE may rely on one or more safe harbors in determining if coverage is affordable: W-2, Rate of Pay, and Federal Poverty Level.

If the employer’s coverage is not affordable under one of the safe harbors and a full-time …

By |September 21st, 2021|Affordable Care Act, Compliance, Disability, Employee Benefits, Employee Benefits Adviser, Employee Communications, Human Resources, IRS, Legislation, Medical, Private Health Care Exchange, U.S. Department of Labor, Wellness|Comments Off on Legal Alert- IRS Issues Affordability Percentage Adjustment for 2022
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Agencies Release Proposed Regulations on Short-Term Limited Duration Insurance

On February 20, 2018, the U.S. Departments of Labor, Treasury, and Health and Human Services (Agencies) released proposed regulations that expand the availability of short-term limited duration insurance (STLDI). STLDI is offered in the individual (non-group) insurance market and is generally used by individuals such as students or individuals between jobs. Therefore, the direct impact to employers is limited; however, there is some concern that this rule may disrupt the individual and small group markets and is seen by some as a further step by the Trump administration to erode Obama-era regulations.

The rule reverses prior regulations that limited the duration of STLDI coverage to less than 3 months after the original effective date of the contract. If finalized, the rule would extend the permitted duration of STLDI to a period of less than 12 months. The rule does not require issuers to guarantee renewability of STLDI policies; however, it does not prohibit individuals from re-applying for coverage for another 364 days (which would likely be subject to medical underwriting).

The proposed regulations are in furtherance of an October 2017 Executive Order instructing the Agencies to consider ways to promote healthcare choice and competition by, among other things, expanding the availability of STLDI. The regulations are open for public comment for 60 days.

Although STLDI is sold in the individual market, it is exempt from ACA’s insurance mandates, which typically makes it more affordable than the ACA-compliant plans that are required to offer coverage in ten broad categories of essential health benefits and contain other consumer protections. STLDI, on the other hand, is not required to cover essential benefits and may contain preexisting condition exclusions and annual and lifetime limits.

There is concern that expansion of STLDI availability …

By |March 6th, 2018|Disability, Employee Benefits, Employee Communications, Medical, Short Term Disability|Comments Off on Agencies Release Proposed Regulations on Short-Term Limited Duration Insurance
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The New York Paid Family Leave Law Became Effective January 1, 2018. Confused?

It keeps getting harder for even the most seasoned Human Resources team to stay on top of employee leaves.  Employers with 50 or more employees in New York need to comply with the federal Family and Medical Leave Act (FMLA) and the new New York Paid Family Leave (NYPFL).  Here are some key differences to consider: …

By |February 15th, 2018|Compliance, Disability, Human Resources|Comments Off on The New York Paid Family Leave Law Became Effective January 1, 2018. Confused?
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DOL Announces April 1 Applicability of Final Disability Plan Claims Procedure Regulations

The U.S. Department of Labor (DOL) announced its decision for April 1, 2018, as the applicability date for ERISA-covered employee benefit plans to comply with a final rule (released in December 2016) that imposes additional procedural protections (similar to those that apply to health plans) when dealing with claims for disability benefits. In October 2017, the DOL had announced a 90-day delay of the final rule, which was scheduled to apply to claims for disability benefits under ERISA-covered benefit plans that were filed on or after January 1, 2018.

Effective Date

While the DOL’s news release indicates that the DOL has decided on an April 1 applicability date for the final rule, the regulatory provision modified by the 90-day delay specified that the final rule will apply to claims filed “after April 1, 2018.”

Plans Subject to the Final Rule

The final rule applies to plans (either welfare or retirement) where the plan conditions the availability of disability benefits to the claimant upon a showing of disability. For example, if a claims adjudicator must make a determination of disability in order to decide a claim, the plan is subject to the final rule. Generally, this would include benefits under a long-term disability plan or a short-term disability plan to the extent that it is governed by ERISA.

However, the following short-term disability benefits are not subject to ERISA and, therefore, are not subject to the final rule:

The U.S. Department of Labor (DOL) announced its decision for April 1, 2018, as the applicability date for ERISA-covered employee benefit plans to comply with a final rule (released in December 2016) that imposes additional procedural protections (similar to those that apply to health plans) when dealing with claims …

By |January 24th, 2018|Disability, Employee Benefits, Employee Communications, Human Resources, Legislation, Long Term Disability, Short Term Disability|Comments Off on DOL Announces April 1 Applicability of Final Disability Plan Claims Procedure Regulations
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Massachusetts Releases Proposed Regulations on EMAC Supplement; HIRD Form Returns

On August 1, 2017, Massachusetts Governor Charlie Baker signed H.3822, which increases the existing Employer Medical Assistance Contribution (EMAC) and imposes an additional fee (EMAC Supplement) on employers with employees covered under MassHealth (Medicaid) or who receive subsidized coverage through ConnectorCare (certain plans offered through Massachusetts’ Marketplace). The increased EMAC and the EMAC Supplement are effective for 2018 and 2019 and are intended to sunset after 2019.

On November 6, 2017, the Massachusetts Department of Unemployment Assistance (DUA) released proposed regulations on the EMAC. Also on November 6, Governor Baker signed H.4008, which includes a provision that requires Massachusetts employers to submit a health insurance responsibility disclosure (HIRD) form annually.

The increased EMAC and the EMAC supplement are intended to be offset by a reduction in the increase of unemployment insurance rates in 2018 and 2019. The unemployment insurance relief is estimated to save employers $334 million over the next two years.

The EMAC itself is relatively new, having been created in 2014 after the repeal of Massachusetts’ “fair share” employer contribution. The EMAC applies to employers with six or more employees working in Massachusetts and applies regardless of whether the employer offers health coverage to its employees. Currently, the EMAC is .34% of wages up to $15,000, which caps out at $51 per employee per year. For 2018 and 2019, it will increase to .51%, or $77 per employee per year. In 2018, the EMAC and EMAC Supplement are expected to raise $75 million and $125 million in revenue, respectively.

Proposed Regulations on EMAC Supplement

The EMAC Supplement applies to employers with 6 or more employees in Massachusetts. Under the EMAC Supplement, employers must pay 5% of annual wages up to the annual wage cap of …

By |November 22nd, 2017|Disability, Employee Communications, Legislation, Medical, Private Health Care Exchange|Comments Off on Massachusetts Releases Proposed Regulations on EMAC Supplement; HIRD Form Returns
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Legal Alert: Court Requires EEOC to Substantiate 30% Limit on Wellness Program Incentives

On August 22, 2017, a federal court in the District of Columbia ordered the Equal Employment Opportunity Commission (EEOC) to reconsider the limits it placed on wellness program incentives under final regulations the agency issued last year under the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA).  As part of the final regulations, the EEOC set a limit on incentives under wellness programs equal to 30% of the total cost of self-only coverage under the employer’s group health plan.  The court found that the EEOC did not properly consider whether the 30% limit on incentives would ensure the program remained “voluntary” as required by the ADA and GINA and sent the regulations back to the EEOC for reconsideration.

In the meantime, to avoid “potentially widespread disruption and confusion” the court decided that the final regulations would remain in place while the EEOC determines how it will proceed (e.g., provide support for its regulations, appeal the decision, or change the regulations). As background, under the ADA, wellness programs that involve a disability-related inquiry or a medical examination must be “voluntary.”  Similar requirements exist under GINA when there are requests for an employee’s family medical history (typically as part of a health risk assessment).  For years, the EEOC had declined to provide specific guidance on the level of incentive that may be provided under the ADA, and their informal guidance suggested that any incentive could render a program “involuntary.”  In 2016, after years of uncertainty on the issue, the agency released rules on wellness incentives that resemble, but do not mirror, the 30% limit established under U.S. Department of Labor (DOL) regulations applicable to health-contingent employer-sponsored wellness programs.  While the regulations appeared to be a …

By |September 11th, 2017|Compliance, Disability, Employee Benefits, Employee Communications, Health Care Reform, Legislation, Medical|Comments Off on Legal Alert: Court Requires EEOC to Substantiate 30% Limit on Wellness Program Incentives
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Law Firms- Do you really Know What’s in Your Group Long Term Disability Contract?

Group Long Term Disability insurance (LTD) is intended to protect the income of the firms partners or directors, of counsel, attorneys and staff in the event they suffer an injury or illness.  It’s a very inexpensive benefit to purchase yet arguably one of the most important.  Group LTD can ultimately cover millions of dollars of potential loss in the event of a permanent disability.  Many law firms fail to realize that subtle features and provisions within their group policy can dramatically increase or decrease the payout for a claim until a claim unfortunately occurs.

Through our years of experience working with the legal profession we’ve developed a systematic approach to providing specialized coverage for law firms.  As part of the Broad Reach Benefits process, our team provides you with a group LTD plan audit.  By providing us with a copy of your current LTD summary plan description and answering a few questions we can produce a detailed assessment of any potential areas of weakness in your current LTD contract.  Since each insurance carrier can provide varying levels of contracts it is critical to understand what and how your contract provides protection. Most benefit brokers provide a simple spreadsheet comparison that takes an executive summary view of the benefits and compares prices.  This approach will not show the “under the hood” provisions and clauses that will have a dramatic impact on benefit payouts in the event of a claim.

Below are a few questions to consider when thinking about your current group LTD policy: …

By |March 3rd, 2014|Disability, Employee Benefits, Law Firms, Long Term Disability|Comments Off on Law Firms- Do you really Know What’s in Your Group Long Term Disability Contract?
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