The HR Strategist: November 2015
In this issue:
- What to Do in the Event of an Active Shooter
- Are Gift Cards Considered Taxable Income?
- Department of Labor Overtime Rule Delay
- What DC Employers Need to Know in 2016
- Did You Know?
The Department of Homeland Security defines an Active Shooter as "an individual actively engaged in killing or attempting to kill people in a confined and populated area; in most cases, active shooters use firearm(s) and there is no pattern or method to their selection of victims."
Active shooter situations are unpredictable and evolve quickly. Typically, the immediate deployment of law enforcement is required to stop the shooting and mitigate harm to victims.
Because active shooter situations are often over within 10 to 15 minutes, before law enforcement arrives on the scene, individuals must be prepared both mentally and physically to deal with an active shooter situation.
Good practices for coping with an active shooter situation include:
- Be aware of your environment and any possible dangers
- Take note of the two nearest exits in any facility you visit
- If you are in an office, stay there and secure the door
- Call 911 as soon as it is safe to do so
Additionally, to best prepare your staff for an active shooter situation, create an Emergency Action Plan (EAP), and conduct training exercises which can include videos such as this one. Together, the EAP and training exercises will prepare your staff to effectively respond and help minimize loss of life.
An effective EAP includes:
- A preferred method for reporting fires and other emergencies
- An evacuation policy and procedure
- Emergency escape procedures and route assignments (i.e. floor plans, safe areas)
- Contract information for, and responsibilities of individuals to be contacted under the EAP
- Information concerning local area hospitals (i.e. name, telephone number, and distance from your location)
- An emergency notification system to alert various parties of an emergency including
- Individuals at remote locations within premises
- Local law enforcement
- Local area hospitals
For additional information, please visit the Department of Homeland Security's website.
Giving gift cards is an easy way to show appreciation to employees, which likely improves morale, but gift cards can become an administrative burden and anger employees with a tax surprise. Most gift cards incur some kind of taxes, so your company should consider gifts that avoid taxation. However, there are non-taxable alternatives to convey your gratitude.
Internal Revenue Code Section 102 covers the general rule that excludes property acquired "by gift, bequest, devise, or inheritance" from gross income. However, Section (c)(1) of this law provides that employee gifts (including prizes and awards) – specifically "any amount transferred by or for an employer to, or for the benefit of, an employee" – may not be excluded from gross income.
So the general rule is that employee gifts and prizes are counted as income. However, as with most laws, there are exceptions.
"De minimis" fringe benefits are excluded from income. De minimis benefits are those that are "so small as to make accounting for [them] unreasonable or impractical." For example, "occasional tickets for entertainment events; [certain] holiday gifts; flowers, fruit, books, etc., provided under special circumstances, etc."
The IRS has ruled that items with a value exceeding $100 cannot be considered de minimis. Additionally, cash and cash equivalent gifts/prizes (such as gift certificates) cannot be considered de minimis or excluded from income because there is no difficulty in accounting for such prizes.
In other words, any gift card that serves as a cash equivalent – such as a $25 Amazon gift card or a Visa cash card – would always be taxable regardless of the amount because there is no difficulty in accounting for the monetary value of the gift.
However a gift with a less obvious cash value – such as a holiday turkey or tickets to an event – would not be taxable as long as the value does not exceed $100.
For additional information, the IRS provides a very detailed and helpful guide to understanding fringe benefits.
At the American Bar Association's Labor and Employment Law Conference earlier this month, the Solicitor of Labor, M. Patricia Smith, announced that the finalized changes to the FLSA's overtime eligibility rules likely won't be issued until late 2016.
In 2004 – the last time the Fair Labor Standards Act (FLSA) overtime rules were overhauled – the DOL provided 120 days for employers to review the new regulations and to make the necessary changes in their organizations. In 2016, the DOL might find itself with a much shorter window, perhaps only 30 or 60 days, between when it publishes the final rule and when the rule has to go into effect.
In the event that employers do have as little as 30 days to implement the final rule, they may prepare to reclassify workers by getting ready now for different possible scenarios under the final rule; do their best to reclassify after the final rule; or wait until after the presidential election in hopes that the rule might be revoked.
Another possibility employers should prepare for is a phased-in effective date. Phased-in effective dates have been used with minimum wage laws in some cities this year and could be used for the raised salary threshold to make the process more manageable.
HRi is closely monitoring developments and implementation timeline of the new Department of Labor Overtime Rule on behalf of our clients.
DC Health Link
As of January 1, 2016 all DC Employers MUST offer benefits through the DC Health Link. The DC Health Link offers quality, affordable medical, dental, and/or vision insurance to individuals and families as well as small businesses. Businesses with 1-50 employees are eligible and can enroll anytime.
This applies to DC Employers who are not renewing their health benefits with their current insurance carrier in 2015. If you are a DC Employer and are renewing your health benefit plans in 2015 with your current carrier, you are not required to enroll through the DC Health Link for the 2016 enrollment period.
For example, Company A currently offers health benefits through Insurance Carrier A. Should Company A renew their plan with Insurance Carrier A in 2015, they will not need to enroll through the DC Health Link. However, should Company A decide to change insurance carriers from Insurance Carrier A to Insurance Carrier B for 2016, they are required to enroll through the DC Health Link.
When renewing health benefit plans for the 2017 enrollment period, all DC Employers must offer benefits through the DC Health Link – regardless of whether they are renewing with their current insurance carrier or not.
DC's Commuter Benefits Ordinance
By January 1, 2016, DC employers with more than 20 employees will be required to provide one of three commuter benefit options.
1. Employee-Paid Pre-Tax Benefit
Commuter benefits in the form of employee-paid pre-tax deductions are federally approved employer-provided incentives for employees to reduce their monthly commuting expenses for transit, vanpool and parking.
Employees have an option to set aside $130/month in pre-tax funds through their paycheck each month for their transit or vanpool expenses or $250/month for parking expenses. By doing so, taxable income is reduced, which translates to a travel savings of up to 40 percent. As a result, business payroll taxes decrease, so you may see up to 9 percent savings for each employee participating in the benefit.
2. Employer-Paid Direct Benefits
Commuter benefits in the form of an employer-paid subsidy are federally approved employer provided incentives for employees to reduce their monthly commuting expenses for transit, vanpool, biking and parking.
Through this option, you can subsidize employee transit, vanpool, and bike commuting costs. As with the employee-paid benefit, you do not pay payroll taxes and employees do not pay federal or payroll taxes on the benefit amount. IRS code states employers are able to directly offer employees up to $130/month for transit or vanpool; or $20 for bicycling benefits.
3. Employer-Provided Transportation Service
Employer-provided transportation service can include vanpools from outside of DC limits or shuttles from Metro stations, Park-and-Rides, major hubs or anywhere else employees are commuting.
Heather Guerieri, Executive Director of Compass Regional Hospice, has been named Business Leader of the Year by the Queen Anne's County Chamber of Commerce.
The award was announced prior to the chamber's 8th annual Queen Anne's County Business and Home Expo at the Chesapeake Bay Beach Club on Thursday, Oct. 22. Guerieri was cited for her "extraordinary leadership and vision" as the hospice made the transition to a regional facility, "the only free-standing general inpatient hospice provider on the Eastern Shore."
The Chamber also noted that under Guerieri's leadership, the number of hospice employees has doubled to 60 and the volunteer pool has increased to almost 300.
Please join us in congratulating Heather in receiving this prestigious award!
Click here for the full article.