Hot HR Issues for 2017

Congressional Review Act & Labor Laws

The Congressional Review Act (“CRA”) permits lawmakers to overturn new regulations issued by federal agencies within 60 legislative days of the regulation being issued. Historically, this law has seen little use – but the new administration and Congress have employed this law to roll back several regulations enacted in the final months of the Obama administration.

Just last month, Congress used the CRA to overturn OSHA’s “Volks” rule, a regulation that allowed OSHA to cite employers for failing to record workplace injuries or illness at any time during the mandatory five-year record retention period. Prior to this regulation, employers could only be cited for violations of the record-keeping requirement that occurred within the preceding six-month period. By repealing this regulation, Congress and President Trump restored the period for which employers may be cited back to this original six-month period rather than the five-and-a-half-year period under the repealed regulation.

While Congress rolling back the Volks rule does not change an employer’s responsibility to maintain records of workplace injuries or illness, it does limit the period for which employers could be cited for record-keeping violations. However, even with the CRA, the majority of the OSHA regulations issued last year remain in place.

Employers who have already taken steps to adapt to other recent labor regulations, including OSHA’s electronic reporting rule, should expect that these regulations will remain in place even though the CRA has been used to roll back a wide range of regulations. The CRA window closed on May 9 for regulations issued between June 13, 2016, and January 3, 2017. But there is still some uncertainty over the fate of other regulations being challenged in the courts – including the new overtime salary threshold.

Pennsylvania Minimum Wage

While a federal increase in the minimum wage for hourly employees seems unlikely at this time, there is movement at the state level in Pennsylvania for a higher minimum wage that may affect employers throughout the Commonwealth. The Wolf administration is currently calling for a large increase in the Pennsylvania minimum wage – an increase of $4.75 to bring the minimum hourly wage up to $12.00 from $7.25. If enacted, this would be the highest state-level minimum wage in the country.

A $12.00 per hour minimum wage may not be likely, but some increase is possible, especially given that several neighboring states have higher minimum wages, such as New York at $9.70 and Ohio at $8.15. An increase in Pennsylvania’s minimum wage to these levels may be more likely.

The American Health Care Act

The American Health Care Act (“AHCA”), in its current form, eliminates several provisions of the Affordable Care Act (“ACA”) requiring employers to take certain actions. The ACA’s employer mandate, which required employers of 50 or more fulltime equivalent employees to provide insurance, included a penalty for employers in this category who failed to provide insurance. Under the AHCA, the penalty is eliminated. However, the insurance reporting and notification requirements under the ACA would remain until further regulatory action is taken.

The AHCA also increases the allowed tax-free contributions to Health Saving Accounts (“HSAs”) to the out-of-pocket maximums under certain high deductible health plans. Additionally, funds in HSAs could be used for over-the-counter medications under the AHCA. Similarly, the ACHA eliminates the tax-free contribution limit for health Flexible Savings Accounts (“FSAs”) – currently, the contribution limit for these accounts is $2,600. These accounts could be used to pay for certain medical expenses including both prescription and over-the-counter medications as well as other qualified medical expenses.

It may be a little early for employers to start revisiting their benefit plans, especially with expected major rewrites of the AHCA in the Senate. While employers should keep a close eye on those changes, for the time being, the coverage, reporting and penalty provisions under the ACA still apply.