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1. 2013 Employment Law Updates January 17, 2013 • Presented by: Sheila Kepler,SPHRPresident Example text Go ahead and replace it with your own text. This is an example text. This program, ORG-PROGRAM-138195, has been approved for 1.0 (Credit Hours: General) recertification credit hours toward PHR, SPHR and GPHR recertification through the Human Resource Certification Institute (HRCI).

2. EEOC Top Targets • Background checks in hiring • Leave policies for pregnant workers • Litigation of national and regional class-action cases • LGBT discriminations (lesbian, gay, bisexual and transgender) • Strict leave policies and the ADA (Americans with Disabilities Act)

3. Federal Updates I-9 Enforcement and E-Verify Compliance Monitoring Will Increase in 2013 On Jan. 1, North Carolina, Tennessee, and Pennsylvania joined Arizona, Utah, Louisiana, Mississippi, Alabama, Georgia, and South Carolina in requiring all or most employers to verify employees' authorization to work in the U.S. using the federal E-Verify system. A nationwide E-Verify requirement could be passed this year, but at the very least, employers should expect more states to increase E-Verify enforcement and the U.S. Department of Justice to launch more investigations of E-Verify-related discrimination. Additionally, the U.S. Department of Homeland Security remains committed to worksite enforcement in 2013. Fines levied against employers for I-9 violations hit a record high in the 2012 fiscal year, and more of the same is expected for the current fiscal year, making it important for employers to have sound I-9 processes and ensure personnel receive up-to-date I-9 training. *Updated I9 form is still pending – current form expired in August 2012

4. Federal Updates Staggering 2012 statistics for ICE workplace audits and fines • Number of Audits • 2007 – 250 • 2008 – 503 • 2009 - 1,444 • 2010 - 2,000 • 2011 - 2,496 • By the end of 2012, Immigration and Customs Enforcement’s (ICE) efforts in I-9 audits broke previous records:  it inspected more than 3,000 businesses for I-9 employment eligibility verification compliance and issued nearly $13 million in fines • ICE has offices in all 50 states and employs more than 20,000 people

5. Federal Updates • IRS Mileage - change from 55.5 to 56.5 cents • Cap on Flex Spending Accounts (FSA) reduced to $2,500 • Commuter pretax benefit increase from $240 - $245 (second change) • 2012 FUTA tax from .9% to 1.2% will 2013 = 1.5%? • 2013 FICA SS payroll tax from 4.2% to 6.2%

6. Federal Updates Updated Federal Credit Reporting Act (FCRA) Notices Effective January 1 – must use the updated “FCRA Summary of Rights” and other notice requirements for consumer reporting agencies. Note: New notices are updated on the Manager portal

7. Federal Updates The Affordable Care Act - Employer Mandate Webinar on Monday, January 28, 2012 at 11am PST Learn how “pay or play” requirements will affect you and your business. • Report the value of the group health plans on W2’s • Reduced Flex Spending Accounts - $2,500 • Increases the Medicare tax for employees over $200,000 • March 2013 - Announcement of Exchanges • 2014 – Mandate for employers over 50 employees (threshold expected to change by state) – offer coverage or pay a penalty of $2,000 per employee

8. State Minimum Wage Updates

9. California Updates

10. California Updates Breastfeeding Protected Under the FEHA - AB2386 • Prohibited form of sex discrimination • Existing law requires breaks and a private room (not a restroom) New Pregnancy Regulations Updated written notices that must be posted and new definition of four months now includes various methods of calculation – making it more complicated

11. California Updates Commissions plans - AB1396, AB2675 • Written agreement – signed by employee (includes legal language) • Definition of commission – any compensation paid that is related to the companies service or products • Must include method by which the commissions are paid and calculated • Must include when commission earned, performance expectations, at will language, reference to employee handbook, meal and rest break requirements, have a beginning and end date (review and renew contracts) • Employer must have employee sign • Employees must receive a signed copy

12. California Updates Commuter Benefits - SB1339 • San Francisco – more than 20 employees anywhere must comply • Must offer to San Francisco employees a pre-tax deduction of up to $125 each month to pay for covered commute expenses Remember – Sick time and mandatory health insurance requirements as well

13. California Updates Contracts with Warehouse Contractors - AB1855 • Prohibits employers from entering into agreements that do not comply with applicable laws or regulations. Must include funds that are sufficient to cover costs such as minimum wage, overtime, workers’ comp and other laws. • Janitorial • Farm labor • Security or • Warehouse contractors

14. California Updates Domestic Partners Health Insurance coverage - SB757 The new law makes an amendment to the current law by stating that the plan or policy is not able to discriminate based on same sex domestic partners or different sex domestic partners as well as same sex spouses or different sex spouses. Insurance companies are required to offer the same coverage to domestic partners, same sex or not, as they would to the spouse of the insured whether the same sex or not. If they willfully violate the amended provisions they are committing a crime.

15. California Updates Human Trafficking - SB1193 • Requires a notice to be posted in: • Hospital emergency rooms • Truck stops • Airports • Holders of liquor license Attorney General’s office is developing a model notice to be posted by April 1, 2013

16. California Updates Itemized Wage Statements - AB1744 and SB1255 July 1, 2013 - Temporary staffing agencies – itemized wage statement with assignment information All employers - Nine categories must be on paystubs – employee can recover $50 for the initial pay period and $100 each subsequent, up to $4,000 plus costs and attorney’s fees Gross wages, total hours, piece rate units, all deductions, net wages, pay period, employee name and last four digits of ss#, name and address of the employer, hourly rates corresponding with hours worked

17. California Updates Overtime for Salaried workers - AB2103 Fixed salary to a non-exempt employee (not tracking hours worked) Cannot waive overtime worked

18. California Updates Penalties for Failing to Pay Labor Commissioner Awards - SB1144 Increases fine for employers who fail to pay wages due employees. (timely, final wages, PTO balances) Employers who violate the statue are guilty of a misdemeanor For awards over $1,000 the minimum fine will be $10,000

19. California Updates Personnel Files - AB2674 • Amends current law and updates: • Must allow employee or former employee to inspect file within 30 days • Must provide a copy of the complete file • Must provide copies of pay stubs within 21 days (online access will comply) • Must keep for 3 years after termination Note: Days means calendar days

20. California Updates Religious Accommodations - AB1964 • Religious dress practice – • Wearing or carrying clothing • Head or other coverings • Jewelry, artifacts • And any other item that is part of the observance Latest news: Vegan can pursue a religious discrimination claim

21. California Updates Retirement Savings Plans - SB1234 Employers with 5 or more employees must offer a payroll deposit retirement savings arrangement Will become effective soon

22. California Updates Social Media Privacy - AB1844 Prohibits employers from requesting user names or passwords (includes personal email and text messages) • Does not include: • Investigations of misconduct or violation of law • Employer issued electronic devices Keep in mind the NLRB

23. California Updates AB1775 Wage Garnishment - Effective July 1, 2013 - increases the amount of wages exempt from an “earnings withholding order” AB1845 the EDD can deny reimbursement to an employer for any overpayments made to their reserve account if the employer fails to respond adequately – effective after October 22, 2013

24. California Updates Workers' Compensation - SB863 Revisions to how the insurers and health care providers operate and benefits offered to injured workers

25. Business Tax Credits Federal Renewal Community Tax Credit The Renewal Community Tax Credit is equal to 15% of the first $10,000 in wages in any year if the employee lives and provides services in a Renewal Community. All industries are able to participate in this program. The Department of Housing and Urban Development designated 40 Urban and Rural Renewal Communities effective January 1, 2002. Renewal Communities also offer many other increased deductions, depreciations and capital gains incentives. Work Opportunity Tax Credit (WOTC) The Work Opportunity Tax Credit is a federal hiring incentive that is available nationally and provides businesses with an incentive to hire individuals from targeted groups that have a particularly high unemployment rate or other special employment needs. WOTC helps targeted workers move from economic dependency into self-sufficiency as they earn a steady income and become contributing taxpayers, while participating employers are able to reduce their income tax liability. The WOTC provides a federal tax credit of up to $2,400, $4,800 and/or $9,000 per qualified employee. Federal Empowerment Zone Tax Credit The Empowerment Zone Tax Credit is equal to 20% of the first $15,000 in wages in any year if the employee lives and provides services in an Empowerment Zone. All industries are able to participate in this program. Empowerment Zones and Enterprise Communities also offer many other increased deductions, depreciations and capital gains. More information under the manager portal

26. Labor Law Poster Updates • Cal/OSHA notice • Discrimination and Harassment notice • EDD Notice to Employees • Employee Polygraph Protection Act notice • New Pregnancy Leave Notices A and B KimstaffHR clients: Posters will be arriving next week OSHA Log Posting - February 1 through April 30 - if over 20 employees

27. Ongoing Updates

28. Questions? Thank you for attending For more information contact your dedicated HR Specialist or email: info@kimstaffhr.com This program, ORG-PROGRAM-138195, has been approved for 1.0 (Credit Hours: General) recertification credit hours toward PHR, SPHR and GPHR recertification through the Human Resource Certification Institute (HRCI).