On May 13, 2022, the Miles & Stockbridge Labor, Employment, Benefits & Immigration practice group presented its twentieth annual Hot Topics in Employment Law seminar to clients from throughout Maryland and beyond. Topics covered included remote work; tax issues, FMLA, and federal and state leave laws; and the myriad issues raised on a day-to-day basis with Human Resources professionals, including coronavirus and mental health concerns, and more. Here are some highlights:
Hidden Dangers of Remote Work
Meg Manchester presented the potential tax consequences of remote employees working in other states, including employee income tax withholding requirements, unemployment tax requirements, and income tax nexus issues that employers need to consider related to remote working relationships with employees. Employers should be aware of potential issues and pitfalls, and discuss the various potential tax implications to the employer that could arise from a remote workforce before approving any remote work policies or specific remote working arrangements.
Kathleen Pontone explained that many states have very different wage laws that all need to be considered for remote workers. A few states even require employers to pay for necessary business expenses of remote work, including computers, internet access, and cell phone bills. Generally, employers do not have to pay the entire cost, but a reasonable portion. It is recommended that employers consider what items employees are required to use, and make sure that it is included in a remote work agreement.
Kirsten Eriksson examined the growing trend for states to require paid family leave and paid sick leave. Most of the paid family leave programs are state sponsored and state run, akin to unemployment. Often, the programs require registering with the state and paying into state contributions programs. For paid sick leave, be aware that carry-over and accrual requirements vary by state, and in most states, part-time employees may be eligible for leave as well.
Lastly, Sufen Zhang covered immigration compliance issues, including H-1B compliance issues as they relate to remote work. Changes in work location may drive up the prevailing wage for an H-1B holder and necessitate the filing of an amended petition with USCIS. It is best practice for employers to assess potential immigration-related implications before making a decision of any request for work location changes.
Emerging Federal and State Issues
Kirsten Eriksson addressed the impact of using AI for recruiting as it can assist with screening candidates’ résumés and analyzing video interviews. However, algorithms are not necessarily free from bias, and employers must pay close attention to ensure that the use of AI does not adversely impact protected groups. The EEOC has recently issued guidance about the risks that AI may result in discrimination against employees with disabilities. In addition, a few states have passed laws to address this issue. For example, under Maryland law, employers are prohibited from using facial recognition technology during pre-employment interviews without the applicant’s consent. We recommend that you check state law to determine what the requirements are where your employees are located.
Sasha Hodge-Wren examined the growing state trend of decriminalizing or legalizing marijuana. Thirty-seven states and D.C. have legalized medical marijuana, and 18 states have legalized it for recreational use. What does this mean for employers? Not much impact. Employers should be mindful of any state exceptions for medical use with proper documentation, set policies for operating/working while under the influence, and check Ban the Box laws in their jurisdiction. Sasha also covered the growing state trend of limiting the use of non-compete agreements with low-wage workers and the rising trend of banning the use of NDAs or non-disparagement provisions in employment contracts based on sexual harassment claims.
Rebecca Leaf presented on the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act. Under the new federal law, which amends the Federal Arbitration Act, employees cannot be forced to arbitrate sexual assault or harassment claims that arise after March 3, 2022, nor can they be barred from bringing these claims as collective actions, even if they previously signed pre-dispute agreements or waivers to this effect. The law, however, does not bar arbitration of discrimination claims based on sex or harassment claims based on other protected classes. Next, Rebecca outlined the ambitious, pro-worker agenda of the NLRB General Counsel and discussed some highly anticipated decisions and rulemaking that we expect the majority-Democratic Board to issue in the coming months. These expected changes from the NLRB will have implications for the way employers do business in both unionized and non-unionized workplaces.
COVID-19 Update: The Current Landscape and Considerations for Employers
Stephanie Baron and Elisabeth Hall provided an update on the legal environment facing employers as it pertains to COVID-19. After discussing the litigation landscape and the type of claims employers have faced in the last two years, they provided an update on current state laws requiring paid COVID leave and reviewed the requirements for accommodating employees with or fearful of COVID-19. Stephanie and Beth also covered the pros and cons of vaccine mandates and the factors employers must consider when deciding on whether to mandate vaccinations, including the need for religious and/or medical accommodation.
Mental Health in the Workplace
Suzzanne Decker and Veronica Jackson addressed concerns surrounding mental illness in the workplace and some suggested dos and don’ts when communicating with employees about mental health challenges. They also shared recommended best practices and recent case law regarding engaging in the interactive process, what qualifies as an essential job function and thus must be accommodated, and when it is appropriate to seek a fitness for duty examination. They also discussed nuances related to alcoholism and drug addiction, which are also recognized as mental health disabilities under the Americans with Disabilities Act.
Finally, Paolo Pasicolan examined the Mental Health Parity and Addiction Equity Act of 2008 (“MHPAEA”), which prohibits health plans from limiting coverage of mental health benefits more stringently than other physical health benefits. MHPAEA applies to financial requirements (e.g., copays and deductibles), quantitative treatment limits (e.g., visit limits), and nonquantitative treatment limits or “NQTLs” (e.g., medical management statements/medical necessity requirements). If the Employee Benefits Security Administration finds a violation, the plan has 45 days to correct it, and violators will be named in a published report and monetary penalties apply. Audits are expected in 2022, and employers need to be prepared. What should you do? Ask questions if you are unsure about compliance, ask your administrator about the comparative analysis of NQTLs, review your comparative analysis using the DOL’s self-compliance tool, make sure your plan document reflects the terms described in the NQTL, and make sure your service agreements cover NQTL analysis.
For more information and access to presentation materials, please visit the event site.
Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.
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