Supervisor having a tough conversation with an employee regarding discipline and termination

Introduction to Discipline and Termination

2018-08-02
, , , , Human Resources

Terminating an employee, whether for misconduct or a reduction in force, is never a pleasant task.  However, at times it is a necessary part of managing a workforce.  Voluntary termination by an employee through resignation or retirement may not carry the negative stigma of an involuntary termination, but it does trigger certain responsibilities for the employer.

Involuntary Termination

Each step in the process of terminating an employee should be carefully executed.  Each step must be carefully and thoroughly documented.  If an employee is discharged for poor performance and later sues alleging discrimination, the employer will have a difficult time defending if the personnel file is devoid of any documentation of the poor performance over a reasonable period of time.

Note: Terminating an employee is a very sensitive matter, requiring careful communication and documentation to avoid potential lawsuits or other future problems. It is prudent to consult an employment law attorney or HR specialist before taking any specific steps should the need to terminate an employee arise.

Although “at-will” employment is common to virtually all states, employees do have substantial statutory protection, as well as remedies found in judicially recognized exceptions to the at-will employment rule.

Statutory Protections

  • Federal law prohibits any adverse employment action based on race, color, sex (including pregnancy and certain protections for lesbian, gay, bisexual, and transgender (LGBT) individuals), age, national origin, disability, military service or genetic information.
  • Federal law further prohibits adverse employment action because an employee:
    • Participates in an investigation or proceeding related to a claim of discrimination, or opposes discriminatory conduct.
    • Reports violations of wage and hour laws, such as minimum wage and overtime.
    • Reports workplace safety violations under the Occupational Safety and Health Act.
  • State and local laws often prohibit discrimination based upon such factors as marital status as well as the factors contained in the federal legislation.
  • Employees of employers with more than 50 employees have the right to leave under the Family and Medical Leave Act.  Some states provide such protection as well, often covering smaller employees.  Many states also provide job-protected military leave.
  • Voting leave under state law.
  • Jury and witness leave under state law.
  • Terminations which may be construed to be implemented to avoid payment of benefits under a plan covered by ERISA.
  • COBRA continuation coverage of group health care benefits or state “mini-COBRA” benefits.
  • The right to notice by larger employers of certain mass layoffs under the WARN Act, which requires advance notice to employees terminated as a result of a plant closing or mass layoff.

Although this list is not exhaustive, you can see the need for sound HR practices regarding termination, because there are many potential pitfalls for employers surrounding terminations.

lightning storm against purple sky and buildings

IRS Tips On Preparing for Natural Disasters

2018-07-24
Human Resources

Using Electronic Records and Documenting Valuables Encouraged

With hurricane season approaching, the IRS is offering advice to those impacted by storms and other natural disasters. The following tips may help businesses prepare for such events:

  • Use electronic records. Businesses may have access to bank and other financial statements online. If so, their statements are already securely stored there. They can also keep an additional set of records electronically. One way is to scan tax records and insurance policies onto an electronic format. Businesses may want to download important records to an external hard drive, USB flash drive or burn them onto CDs or DVDs. Be sure to keep duplicates of records in a safe place. For example, store them in a waterproof container away from the originals. If a disaster strikes your business, it may also affect a wide area. If that happens, it may be impossible to retrieve the records that are stored in that area.
  • Document valuables. Take time and date stamped photos or videos of the contents of your business. These visual records can help prove the value of lost items. They may help with insurance claims or casualty loss deductions on a tax return. Businesses should also store these in a safe place.
  • Contact the IRS for help. Businesses that fall victim to a disaster may call the IRS disaster hotline at 866-562-5227 for special help with disaster-related tax issues.
  • Get copies of prior year tax records. If a business needs a copy of its tax return, it should file IRS Form 4506, Request for Copy of Tax Return. The usual fee per copy is $50. However, the IRS is expected to waive this fee if a business is a victim of a federally declared disaster. For information that shows most line items from a tax return, call 1-800-908-9946 to request a free transcript. Alternatively, businesses may file IRS Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript, or IRS Form 4506-T, Request for Transcript of Tax Return.

The IRS offers many resources to help employers plan for and recover from disasters, including IRS Publication 584-B, Business Casualty, Disaster, and Theft Loss Workbook, and webpages devoted to preparing for a disaster and tax relief in disaster situations.

man sitting at desk with calculator and receipts doing math

‘Pay or Play’ Estimator Available from IRS

2018-07-19
Human Resources

Tool Provides Estimates Only

The Taxpayer Advocate Service—an independent organization within the Internal Revenue Service (IRS)—has developed an Employer Shared Responsibility Provision Estimator tool to assist employers in understanding how the Affordable Care Act’s employer shared responsibility (“pay or play”) provisions work and how the provisions may apply to them.

Employers can use the tool to determine their:

  • Number of full-time employees, including full-time equivalent employees (FTEs);
  • Applicable large employer (ALE) status; and
  • Estimated maximum amount of potential liability for the employer shared responsibility payment (“pay or play” penalty payment).

The tool provides estimates only. As a result, employers are advised to use it only as a guide to assist in making decisions regarding their tax situation.

man in hospital bed contemplating future

New Expiration Date for Certain FMLA Notices is July 31, 2018

2018-07-09
Human Resources

Model Notices Previously Expired on June 30, 2018

The U.S. Department of Labor’s Wage and Hour Division (WHD) has extended the effective date of the following model FMLA notices through July 31, 2018:

Previously, these model notices expired on June 30, 2018. No other changes have been made to these notices besides their effective date.

For further guidance regarding these notices, please contact the WHD directly at 1-866-487-2365.

newborn infant baby girl foot with hospital tag

Massachusetts Adopts Paid Family and Medical Leave Program

2018-07-03
Human Resources

Law Requires Employer Contributions

Massachusetts has adopted a paid family and medical leave program, which will be funded by a payroll tax that becomes effective July 1, 2019. Employees can begin taking paid family and medical leave under the program in 2021. A summary of the program is below.

Which employers are covered? Employers with 1 or more employees
Which individuals are eligible for leave? Employees who meet financial eligibility requirements for unemployment insurance (earned at least $4,700 during the last 4 completed calendar quarters, and 30 times the weekly benefit amount they would be eligible to collect)
Which life events qualify for leave?
  • The birth of a child;
  • The need to care for a family member with a serious health condition; and
  • The employee’s own serious health condition.
For how long can leave last?
  • Up to 12 weeks in a year for the birth of a child or to care for a family member with a serious health condition.
  • Up to 20 weeks in a year for the serious health condition of the employee.
  • If an employee elects to use leave for more than one life event, 26 weeks in a year at most.
Who pays for the paid leave? Both the employer and the employee. The leave program will be funded by a 0.63% payroll tax split between employers and employees that becomes effective July 1, 2019.

Additional requirements and exceptions apply. Click here to read the law.

mother with toddler daughter visiting smiling doctor

2019 ‘Pay or Play’ Affordability Percentage Set at 9.86%

2018-06-27
Human Resources

Percentage Up from 2018

Under the employer shared responsibility (“pay or play”) provisions of the Affordable Care Act, applicable large employers—generally those who had 50 or more full-time employees (including full-time equivalent employees)—may be subject to a penalty if they do not offer affordable coverage that provides minimum value to their full-time employees and their dependents. For plan years beginning in 2019, the Internal Revenue Service has announced that coverage will generally be considered affordable if the employee’s required contribution for the lowest cost self-only health plan offered is 9.86% or less of his or her household income for the taxable year. For plan years beginning in 2018, the applicable percentage is 9.56%.

Given that employers are unlikely to know an employee’s household income, they may use a number of safe harbors to determine affordability, including reliance on Form W-2 wages.

team of employees in office high fiving in center of conference table

New Rule Eases Formation of Association Health Plans

2018-06-19
Human Resources

Rule Permits Associations Based on Industry or Geography

The U.S. Department of Labor (DOL) has issued a new rule that allows employers to join together as a single group to offer group health insurance coverage to employees, working owners (including those without other employees), and their spouses and dependents as part of an “association health plan.” The rule allows association health plans to be formed on the basis of industry or geography, such as by state, city, county, or multi-state metropolitan area.

The new rule subjects association health plans to the nondiscrimination rules currently applicable to large group coverage under the Health Insurance Portability and Accountability Act (HIPAA), as amended by the Affordable Care Act (ACA). These rules prohibit discrimination based on a health factor or within groups of similarly situated individuals, but do generally permit plans to impose different eligibility provisions and costs based on bonafide employment-based classifications, such as full-time versus part-time status.

team of professionals going over finances with check book to record

Understanding IRS ‘Pay or Play’ Penalty Letters

2018-06-14
, , , , , , Human Resources

Employers Have Opportunity to Respond Before ‘Pay or Play’ Penalty Assessment

The Internal Revenue Service (IRS) is currently issuing Letter 226-J to certain applicable large employers (ALE)—generally those with at least 50 full-time employees, including full-time equivalent employees, on average during the prior year—it believes owe a penalty for failing to comply with the Affordable Care Act’s employer shared responsibility provisions (“pay or play” provisions). In conjunction with Letter 226-J, employers will receive Form 14764, which they can use to respond to Letter 226-J. Employers who submit Form 14764 to the IRS will generally receive one of 4 letters back:

  • Letter 227-J, which acknowledges receipt of Form 14764 and the employer’s agreement to pay the penalty;
  • Letter 227-K, which acknowledges receipt of Form 14764 and shows that the penalty has been nullified;
  • Letter 227-L, which acknowledges receipt of Form 14764 and shows that the penalty has been revised; or
  • Letter 227-M, which acknowledges receipt of Form 14764 and shows that the penalty amount did not change.
image of contract, glasses, laptop, and medical tools on table

Form 5500 Filing Deadline for Many Health Plans is July 31

2018-06-11
, , , , , , , Employee Benefits

Certain Group Health Plans Required to File

Group health plan administrators are reminded that Form 5500 must be filed with the U.S. Department of Labor (DOL) by the last day of the seventh month after the plan year ends. For calendar-year plans, that due date falls on July 31.

Who Must File Form 5500

In general, all group health plans covered by the Employee Retirement Income Security Act (ERISA) are required to file Form 5500. However, group health plans (whether fully insured, unfunded [meaning its benefits are paid as needed directly from the general assets of the plan sponsor], or a combination of the two) that covered fewer than 100 participants as of the beginning of the plan year are exempt from the Form 5500 filing requirement. For more on the Form 5500 requirement, click here.

How to File Form 5500

Forms 5500 must be filed electronically with the DOL using either the IFILE web-based filing system or an approved vendor’s software.

1 … 15 16 17 18 19 … 23
Copyright © 2025 American Association of Business Networking. All rights reserved. Please note that ABN is an association. While we believe you will be pleased with your overall Association membership, we cannot, however, warrant or guarantee the performance of any discount or service.