Employment Law Updates

In January, the U.S. Department of Labor (DOL) announced a final rule attempting to clarify the standard for classifying a worker as an independent contractor rather than employee under the Fair Labor Standards Act. That rule was promulgated under the previous presidential administration and was scheduled to go into effect in March. The rule focused on an “economic reality” test to determine whether the worker is economically dependent upon the employer for work or is actually in business for him/herself. The effect of the rule was to make it easier to classify a worker as an independent contractor rather than an employee.

Under the new American Rescue Plan Act (ARPA), starting April 1, 2021 the federal government will pay 100 percent of COBRA insurance premiums for eligible employees who lost their jobs and for their covered relatives through September 2021, allowing them to stay on their company-sponsored health plan. Employers will obtain the subsidy through a payroll tax credit against employers' quarterly taxes and will be responsible for paying health insurance carriers for the premiums. Both fully insured and self-insured group health plans subject to federal COBRA are eligible for the credit against their Medicare FICA payroll taxes and must provide the COBRA premium subsidy to assistance eligible individuals (AEIs) who have elected COBRA coverage.

The 2021 session of the Virginia General Assembly produced an additional flurry of employment-related laws. The following are some of the more significant laws for many employers:

Effective May 1, the minimum wage in Virginia increases to $9.50 per hour. Although the federal proposal to raise the national minimum wage to $15.00 did not survive the recent Congressional deliberations, last year’s Virginia General Assembly enacted legislation raising the minimum wage in Virginia gradually over several years to $15.00 per hour. The first step is the increase to $9.50 per hour as of May 1, with the second step to $11.00 per hour effective January 1, 2022.

The new federal stimulus law known as the American Rescue Plan Act of 2021 has now been passed by Congress, and President Biden is expected to sign it tomorrow, March 12. The Act contains several provisions relating to employment which are worth noting.

Most employers have policies in their employee handbooks prohibiting the use or possession of alcohol or illegal drugs in the workplace. These policies also typically permit drug testing of employees in certain circumstances, and provide for discipline if an employee tests positive for banned substances. In view of recent legislative developments in Virginia and nationally concerning marijuana, employers should revisit those handbook policies and determine whether any revision is appropriate.

Employers should note two recent developments concerning Covid-19 in the workplace. First, Virginia’s permanent COVID-19 workplace safety and health rules took effect on January 27 after Governor Northam approved the standards adopted by the Virginia Department of Labor and Industry’s Safety and Health Codes Board the previous week. The standards mandate appropriate personal protective equipment, sanitation, social distancing, infectious disease preparedness and response plans, record keeping, training, and hazard communications in workplaces across the Commonwealth. The new standards are similar to the previous Temporary Standards, with slight modifications. One notable difference is a new requirement to notify the Virginia Department of Health if 2 or more employees test positive within 14 days. The new standards are found at the link:

The U.S. Department of Labor (DOL) has announced a final rule clarifying the standard for classifying a worker as an independent contractor rather than employee under the Fair Labor Standards Act. The effective date of the final rule is March 8, 2021.

Most employers have been aware of the paid leave requirements of the Families First Coronavirus Response Act (FFCRA). The FFCRA has required employers with fewer than 500 employees to pay certain amounts of sick and family leave related to coronavirus. The requirements of that law, however, expire on December 31, 2020.

As an addendum to our earlier blog post about mandatory vaccination policies, we should note that the Pfizer vaccine has received only emergency use authorization (EUA) from the FDA, and it is anticipated that the Moderna vaccine will be in the same category. We have learned that the federal statute providing for the emergency use allows the FDA to establish conditions on administering the vaccine. One condition is to inform a person receiving the vaccine of “the option to accept or refuse administration of the product”.

We have received several inquiries from employers about whether they can require employees to receive the new Covid vaccines. The EEOC has issued new guidance on this subject. See section K of that link which deals with vaccinations.

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