HR Advisors: Winter 2021 Tips
With the new year and change in administration, we asked the team at HR Advisors to highlight key areas for compliance and possible modifications we may see in 2021. Changes to the Families First Coronavirus Response Act (FFCRA), classification for gig workers, among other changes, may impact your work or your organization.
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Protection from Discrimination
What did the Supreme Court rule?
The Supreme Court ruled in Bostock v. Clayton County (June 15, 2020) that Title VII protects workers from discrimination on the basis of sexual orientation and gender identity. The ruling left open the issue of whether the Religious Freedom Restoration Act (RFRA) could replace Title VII’s commands. (e.g., Does someone’s religious beliefs allow them to discriminate on the basis of sexual orientation and gender identity?)
What does this mean for employers?
With this ruling, now is the perfect time to review employment-related documents (e.g., manuals, applications, policies) to be sure they include language for sexual orientation, gender identity, and gender-neutral language. These edits, along with incorporation of some new policies within your employee manual, help to better create and communicate an inclusive, accepting, and equitable workplace that welcomes diversity. Training on harassment and discrimination prevention along with other DEAI initiatives is also encouraged.
Classification for Gig Workers
Who is an independent contractor or gig worker?
Have you had to pause and think, “How do I classify this worker? Are they an employee or a contractor?” The U.S. Department of Labor moved to clear up that issue with a new rule clarifying the difference between an independent contractor (what we often call a “gig” worker) and an employee.
What does this mean for employers?
Although the general guidance for employee vs. independent contractor classification has not significantly changed, under the new rule, the difference now depends primarily on two core factors that make up an “economic reality” test:
- The nature and degree of control over the work
- The worker’s opportunity for profit or loss based on initiative or investment
Imagine hiring someone to paint your studio or theater lobby. An independent contractor would use their own equipment, make their own hours, and take on the burden of any profits lost if the job does not go well. On the contrary, an employee, would use specific equipment purchased by you, show up to work on specific times and days determined by you, and be paid for all hours worked.
The “economic reality” is the employee carries no burden related to this task and will be paid for coming to work, regardless of how long the job takes or the cost of materials. On the other hand, the independent contractor gets paid once the job is complete and to the customer’s satisfaction. If it takes longer, or involves more supplies, that “economic reality” and profit reduction is the burden of the contractor.
Why is this important to employers?
Determining how to classify someone – as an employer or a contractor – is an area carefully evaluated by the Department of Labor. Proper classification assures that all legal requirements are maintained so that there is no discrimination in terms of benefit eligibility and payment compensation in accordance with federal and state laws. With a new administration, it is possible there will be a pause to this new rule to examine the language and make further changes.
Changes to the Families First Coronavirus Response Act (FFCRA)
The Families First Coronavirus Response Act (FFCRA) provided federally mandated paid leave through December 31, 2020. While this program was not extended, employers may now elect to voluntarily provide this paid time off and receive tax credits for eligible situations through March 31, 2021.
When tackling FFCRA in 2021, keep in mind two principles:
- FFCRA provides for a maximum of 2 weeks/80 hours of emergency paid sick leave (EPSL) and a maximum of 12 weeks of emergency paid FMLA (EFML). Additional leave time is not available.
- As of Jan. 1, 2021, FFCRA is optional, voluntary, and at the discretion of the employer. It is no longer are enforceable as a federally protected program.
Q. Does an employee receive a new bank of EPSL or EFML in 2021?
A. Refer to principle #1 above. There is no new bank of time as of January 1, 2021. Eligible employees received a maximum allotment of time and earned nothing more when the calendar turned to 2021.
Q. May an employer voluntarily offer EPSL, but not EFML, or vice versa?
A. Arguably, yes. FFCRA contained two different components: EFML and EPSL. These still remain two separate sections; therefore, an employer has the discretion of providing only EPSL and not EFML, or visa verse, through March 31, 2021.
Q. Can an employer tweak any of the provisions under FFCRA and still obtain the tax credit?
A. Unfortunately, no. If employers choose to tweak the conditions of FFCRA leave, then they will not qualify for the tax credit.
Topics to be on the lookout for during 2021:
- Passage of the Equality Act without a religious exemption
- Increase of the federal minimum wage and possible elimination of reduced minimum wage for tipped employees
- Extension of the CARES Act
- Expansion of health and safety requirements under OSHA