Knothead Safety

The Affordable Care Act – Employer Sponsored Health Insurance

In my first article I talked about how to determine whether your company would be covered by the employer mandate (“Play or Pay”)  of the Affordable Care Act (“ACA” aka Obamacare).   The “play” portion of the ACA mandates that qualified “large employers” (discussed last month) either provide a “qualified” employer-sponsored health insurance plan for full-time employees or “pay” a penalty of $2,000/year per non-exempt full-time employee which will begin to be assessed at the rate of $166.67/month per full-time employees over 30, beginning on January 1, 2014.  This article will address the requirements for employer sponsored health plan to be “qualified.”

When determining whether to “play” or pay the associated penalty the determination will rely, in large part, on whether the cost of providing a “qualified” health insurance plan will exceed the cost of the potential penalties.  In addition to the cost issue, you will also have to determine whether there will be other detrimental effects, like decreased workplace morale; employee retention if you were to drop your existing plan (which may not be conforming); your ability to recruit new quality employees if you do NOT offer health insurance; or, even the risk of unionization of your workforce if you do not provide the health benefits. 

The Affordable Care Act – Full-time vs Part-time employees

This is the fourth article in my series on the Affordable Care Act (ACA aka “Obamacare) and what you as a business owner need to be thinking about and planning for in 2013 in advance of the employer mandate going into effect January 1, 2014.  Much of what we discuss will not be a worry for you if you are not an “applicable large employer,” i.e., one that has more than 50 full time employees, or the equivalent number of full-time employees and part-time employees that aggregate to sufficient full-time equivalents to push your total over 50.

First, I should point out that the Internal Revenue Service has not finalized many of the rules that you will have to follow to actually comply with the ACA.  Many of those rules are still in the rule-making process in the form of a “Notice of Proposed Rule-Making” (NPRM) wherein comments are still being solicited from the general public before the final rules will be published.  Despite that, the employer mandate and other provisions of the ACA act go into effect January 1, 2014, and some even sooner.

How To Remain An Unemployment Statistic

I am in the temporary labor and employment industry with a focus on construction.  I have been working at this for almost 8 years now, so I was in this when the construction boom was at its peak, and now when it’s near the bottom.  I have one thing to report – the unemployed 8 years ago are the unemployed today.  The difference is, 8 years ago the unemployment rate was 4% and today it’s 13%.  So logic should tell you that there is a better pool of workers today than there were 8 years ago – right?  Wrong.  Employers have simply weeded out the employment pool in many cases.  When unemployment was at 4%, there were at least 9% of those working that were ONLY working because employers had to have at least warm bodies.   Let me give you some advice if you are unemployed, underemployed, only able to find part-time work and are willing to do “anything”;  You are not entitled to a job.  No one owes you that.  If you have been unemployed for more than six months you better take a hard look in the mirror.

The problem with the majority of unemployed is they are unemployable.  Employers don’t want them and they were the first to be weeded out when the economy went south.  You are either in this category or you are not.  But make no mistake; it is a choice that you get to make.  As a society, we have created an expectation of entitlements; I am entitled to a job; I am entitled to a “living wage”; I am entitled to unemployment compensation; I’m entitled to be treated fairly; I’m entitled to time off for personal issues.  The only thing that you are entitled to, is living in a free America where you can pursue any dream you desire.

Taking the high-road in bad economic times

We’ve all heard the old maxim of how the “pendulum swings.”  It’s no secret that in the current economic times, the pendulum has been swinging in a direction that most of us would rather see reverse itself.  While waiting for the swing to reverse, it’s still good business sense to continue to take the high road in our business endeavors when it comes to our customers, and maybe more importantly, to our employees.

Most locally owned and operated businesses base their success on their reputation in the community.  They value what their customers and employees say about them.  Yet, in an economy like the current, when businesses are struggling to keep their doors open, their employees paid, and their customers happy, it is easy to look for short-cuts to accomplish those goals that could end up being devastating when the economy turns around.

With so many of our fellow Nevadan’s unemployed, or underemployed, it may be tempting for a business to take advantage of that.  That is not to say that there is not a great opportunity to find exceptional workers right now.  What it is saying, is that taking advantage of their current situation will never get you to the great opportunities. 

Should Employees be disciplined for Safety Violations?

An employee shows up for work with alcohol on their breath; do you reprimand them?  An employee insults a customer; do you discipline them?  What about an employee who is late for work just about every day?  Seem like pretty easy questions to answer right?  Performance issues are routinely dealt with in employee handbooks, disciplinary policies and company procedures.  But what if an employee is caught not wearing their hardhat?  Not wearing their safety glasses or hearing protection when required?  Are they disciplined for those lapses as well?

Part and parcel to an effective safety and health program is an equally effective and enforced disciplinary plan for violations of the health and safety program.  In fact, I would suggest that it is MORE critical to apply disciplinary actions to violations of your safety and health program than it is for other performance related issues.  The problem is that unless there is a perceived “effect” to a rule violation, most of the time those violations are overlooked.  If someone simply breaks a rule, like not wearing their hardhat in a “hard hat area” and nothing falls on their head and OSHA doesn’t happen to show up, it is treated like “no harm no foul” and no disciplinary action is ever taken.  So what is the big deal then you ask?

The Affordable Care Act – Play or Pay

In my prior two articles I have introduced you to the employer mandate under the Affordable Care Act (ACA, aka “Obamacare”), and what is required for an employer-sponsored health insurance plan to be “qualified” under the ACA.  In this article, I want to address more specifically the calculation of the two major penalties under the act, one, occurring in the event that you determine not to “play” or in other words provide health insurance coverage (via an “employer qualified health insurance plan”) to your full-time employees; and the other, occurring in the event you do provide health insurance coverage to your full-time employees, but one of more of those employees  receives a premium tax credit or cost-sharing reduction to purchase health coverage through an Affordable Health Insurance Exchange.

As indicated in the first article, if you are determined to be a “large employer”, i.e., have 50 or more full-time employees or a combination of full time employees and part-time employees that aggregate to 50 full-time equivalents, then you will be subject to the employer mandate to provide health insurance to all of your full-time employees and their dependents up to the age of 26.  You need not provide coverage, however, for their spouses.  It is important to remember that the average monthly full-time employees for the calendar year 2013 will be used to determine whether you are a “large employer” for calendar year 2014 when the mandate goes into effect.

Why is OSHA hated?

I teach a lot of safety classes and I find there is a universal sentiment among employers and employees:  Everyone hates OSHA!  The original purpose of the OSHA Act was to make workplaces safer for American workers, thus benefiting both employers and employees.  If that is the case, why does EVERYONE hates OSHA?

Congress gave OSHA this charge:  “[t]o assure so far as possible every working man and woman in the Nation safe and healthful working conditions . . . by encouraging employers and employees in their efforts to reduce the number of occupational safety and health hazards at their places of employment, and to stimulate employers and employees to institute new and to perfect existing programs for providing safe and healthful working conditions.”  (Emphasis mine)
Then Congress set forth the duties of employers and employees:  “Each employer . . . shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees; [and] each employee shall comply with occupational safety and health standards and all rules, regulations, and orders issued pursuant to this Act which are applicable to his own actions and conduct.” 

The Affordable Care Act – Strategies to manage your liabilities

This is the fifth article in my series on the Affordable Care Act (ACA aka “Obamacare) and now that I have you thoroughly confused, and probably a little bit worried, I am going to shift focus and discuss what strategies may be available to you in order to limit your exposure, or perhaps, manage your liabilities. I don’t care if you think Obamacare is a wonderful thing, and I don’t care if you have always paid 100% of the medical insurance for your employees, the things I have discussed in the last four articles are going to have a significant financial impact on most businesses that employe over 50 full-time staff. It only makes sense to begin to think about how you are going to survive.

If you do not have more than 50 full-time employees and never think you will get to that number, then you can just as well quit reading here, but you should probably scroll down to the last 2 paragraphs to see what the effect will be on your employees even if you are not subject to the mandate, and do not offer health insurance for them. Think employee retention when you read those last two paragraphs. If, however, you are already over 50 full-time employees, or, you reasonably believe that you could be at that by the end of 2013, then this article may help you in your planning, because there are some things that you can do, al beit, none of them wonderful.

Should you be concerned about an OSHA inspection at your business?

OSHA is not a large agency.  Between the federal and state run programs, there are about 2,200 OSHA inspectors nationwide. That equates to about one inspector for every 59,000 employees in the US.  They are tasked with insuring the health and safety of American workers at the almost 8 million workplaces in the United States.  If every OSHA inspector was able to conduct one inspection every work day, (about 572,000) and no inspection took more than one day, it would take OSHA about 14 years to inspect every workplace at least once.   In reality though, in 2013 OSHA conducted only 92,094 inspections, which means it would take, in actuality, 87 years to visit every workplace at least once.

So how concerned should you be that OSHA will show up at your workplace for an inspection?  There are a number of factors that can affect this, like the dangerousness of your industry and the higher or lower profile of your business.  But regardless of those factors the fact remains that all businesses are potentially subject to an OSHA inspection.  The real question should be what is the risk to your business if OSHA DOES show up at your business for an inspection?

Is OSHA missing the boat? Reminds me of the “boy who cried wolf”!

You hear much ado from the current Obama appointed Federal OSHA folks about how important the enforcement arm of OSHA is, and of the great deterrent that strong enforcement plays in keeping workplaces safe. There can be no debate that a strong enforcement policy results in better compliance. However, is OSHA’s recent pattern of “pig piling” frivolous violations on top of truly legitimate ones resulting in a backlash from business that defeats their purpose?

I don’t think that anyone will argue that there are employers out there that simply thumb their noses at their obligation to provide a workplace free from recognized hazards. I don’t think that there is much argument that those types of employers deserve the wrath of OSHA for those indiscretions. Recently I have noticed a growing trend for OSHA to conduct an inspection, and rather than find any really serious safety issues, they come with a handful of nitpicky violations like “found fire-extinguisher with expired tag;” “boxes piled in front of exit door;” “inadequate hearing protection;” “poor housekeeping resulting in slipping/tripping hazards;” and my personal favorite, “no posting of floor loading limit on overhead storage area.”

Is Nevada OSHA really that bad?

If you follow the safety press at all, you have been bombarded the past 45 days with what has been deemed the “scathing” Federal OSHA report on the Nevada OSHA program.  After a Pulitzer Prize winning exposé in the Las Vegas Sun prompted a Federal review of the Nevada OSHA program, OSHA released its long anticipated report on October 30 (2010). The 80 page report is available at the OSHA website at www.osha.gov.

As a safety professional, having watched this process unfold, from the release of the report, to the Congressional hearings conducted last month, where Nevada’s Senator Harry Reid testified he was “disappointed in the leadership of Nevada OSHA,” to the news reports on the Internet, I am amazed by the attention the press has given this report. 

Everyone is concerned by any workplace injury or death, and our hearts go out to the victims, their families and their employers.  Any workplace death or injury is a tragedy and we must do everything in our power to look at each one on a case by case basis and try to determine what we can do to prevent similar situations in the future.  The question, however, still remains: Is Nevada’s state run program really that bad?  Let’s look at the facts for our answer.

Benefits and Pitfalls of “Employer’s” job market

The current state of the economy has created an “employer’s” job market.  Such a high unemployment rate (the highest in Nevada since the Bureau of Labor Statistics began keeping records in 1976) means very qualified, very dedicated people that are either unemployed, or underemployed and all actively seeking better opportunities.  This creates opportunities as well as pitfalls for employers.  It all depends on how you manage it.

The longer the economy takes to recover (and many analysts are now saying that could be 2013) the larger the potential pitfalls are for employers for two reasons.  First, the longer people remain unemployed, the less money they have to spend, the more homes go into foreclosure and the downward spiral continues to affect the overall economy.  Second, the more desperately they need work, and the less they are willing to accept as a wage or salary.  While some employers may look at this as an opportunity, it is a double-edged sword.

Someone much smarter than me once said “You can’t manage what you don’t measure.” If measuring your ROI means strict, objective number crunching, then I would suggest that you may frustrate your CPA when you ask him to come up with the metrics that justify your investment in safety and health. But that doesn’t mean we don’t manage it or that it doesn’t have measurable value.

Today, because of OSHA’s aggressive enforcement policy we tend to focus us on the “expense” side of safety and health. OSHA’s approach to safety is punitive and self-defeating as it tends to pit employers against employees contrary to what Congress envisioned 40 years ago. But I digress.

Safety and Health: What is GHS and why should YOU care?

The Occupational Safety and Health Administration (OSHA) recently revised the Hazard Communication Standard to make it compliant with the United Nation’s “ Globally Harmonized System of Classification and Labeling of Chemicals” commonly referred to as GHS.  The intent is to standardize chemical labeling systems used and provided by manufacturers on products containing chemicals as well as to standardize what used to be called Material Safety Data Sheets (MSDS) into a new document called simply a Safety Data Sheet or SDS.

The reason you should care is that most employers are unaware that the current law requires every employer to have a written Hazard Communication Plan under the OSHA standards (29 CFR 1910.1200) and to have provided training to all their employees on their company’s program.  The existing requirements are that the program must be in writing, include a chemical list of all the chemicals that any of your employees may be exposed to as part of their job and, have a corresponding MSDS for each of those chemicals that must be kept on the site where the chemicals are being used.

OSHA’s New Agenda Will Affect All Businesses

Recently the new OSHA director David Michaels held a web chat to answer questions from the public about OSHA’s new regulatory agenda.  The new agenda includes, among other items, a new rule that would require all businesses to implement an Injury and Illness Prevention Plan, which would include “planning, implementing, evaluating and improving processes and activities that protect employee safety and health.”

Although Michaels could not offer many details of the new proposed rule other than to state it is a departure from what OSHA has typically done and that it will hold employers responsible for all hazards in their workplaces.  In explaining, Michaels said that the new rule would not be a substitute for existing OSHA standards; rather, it would provide “a mechanism to achieve culture change needed in this country to effectively address workplace safety and health issues.”

Most contractors know about OSHA requirements for injury and reporting; and most should know that the annual summary must be posted in every workplace from February 1 to April 30th of each year.  But what many contractors don’t realize is that you may have to consider certain jobsites separate entities for reporting and posting requirements.

The OSHA injury and reporting guidelines are found in 29 CFR 1904.  At section 30(a) of that regulation it says “You must keep a separate OSHA 300 Log for each establishment that is expected to be in operation for one year or longer.”  So if you have a job trailer set up at a job that has commenced, and is expected to not be completed for at least 12 months, that jobsite becomes a separate reporting entity under the OSHA rules.  If you have multiple such jobsites, you may need to keep multiple OSHA 300 logs.

What could OSHA’s new SVEP mean for your business?

OSHA’s new Severe Violators Enforcement Program (SVEP) went into effect June 18.  The new rule establishes procedures and enforcement actions for employers who OSHA deems repeatedly expose their workers to hazards in the workplace.  Although the program was adopted by federal OSHA, it has referral procedures which include state programs like Nevada’s, requiring states to either adopt the new program or develop a program of their own that is at least as effective as OSHA’s.

So who is a Severe Violator?  The Severe Violators Enforcement Program Directive, dated June 18 explains that OSHA will focus increased enforcement attention to violations by “employers who have demonstrated indifference to their occupational safety and health obligations through willful, repeated, or failure-to-abate violations in (1) a fatality or catastrophe situation; (2) in industry operations or processes that expose employees to the most severe occupational hazards and those identified as "High-Emphasis Hazards"; (3) exposing employees to hazards related to the potential release of a highly hazardous chemical; or (4) all egregious enforcement actions.”  The directive can be found at http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=DIRECTIVES&p_id=4503

OSHA GRANTS  RESIDENTIAL CONTRACTORS  REPRIEVE

In a June 9th New Release, OSHA gave Residential Contractors a three month reprieve from the new fall protection rules set to take effect June 16.  I had written about the new rules in my May 9th article “OSHA strengthens rules on fall protection and outreach training.”  The new rules have created some confusion and much angst among residential contractors, trying to decide what the new rules will require of them.

Under the June 9th News Release, OSHA has created a three-month “phase-in period” to allow residential contractors to come into compliance with the new directive.  The “new directive” isn’t really new at all, but simply rescinds a prior directive that has been in place since 1999 which allowed residential contractors some less stringent fall protection options than those normally required by Subpart M of the OSHA Construction standards (29 CFR 1926.500 et seq.)
The crux of the change is that, contrary to what residential contractors have been doing since 1999, they will now have to provide conventional fall protection (guardrail systems, safety net systems or personal fall arrest systems) to protect workers who are exposed to falls of six or more feet.  This includes workers setting trusses, sheathing roofs, weatherproofing roofs, installing fascia and gutters or other residential roofing activities.

The Affordable Care Act – what you need to do in 2013

Whether you agree with it or not, the Affordable Care Act (“ACA” aka Obamacare) is being implemented and will kick into full gear on January 1, 2014.  There are no “experts” on what the ACA will mean to employers.  I do not purport to be an expert, and this series of article is not intended to be legal advice or anything other than basic information in this rapidly changing landscape.  Many of the things that you read in these articles may be outdated by the time you read them, because the IRS and HHS are developing the new rules and regulations as you read this.  The intent is to provide some level of basic information so you can begin to think about what impact this legislation may have on your business.
January 1, 2014 is the date that the “employer mandate”, or what is being referred to as the “Play or Pay” provisions go into effect.  Play or Pay simply means that if you are a qualifying “large employer” you either need to provide a qualified employer-sponsored health insurance plan to all of your full-time employees and their children under 26, or, pay the mandated penalty.  The penalties will begin to be assessed on a monthly basis beginning January 1, 2014.  So what do you need to do now?

The Act requires that, no later than March 1, 2013 all employers must provide all employees and all new hires with a written notice of the availability of the state insurance exchanges.  The notice must describe the services provided by the exchanges including notifying employees of their potential eligibility for a premium tax credit or cost-sharing premium reduction.  The department of Health and Human Services (HHS) was supposed to provide a model notice to give employers guidance of what the written notice must contain.  Such model notice has yet to be released.  Because several states have indicated their refusal to set up exchanges, and because many of the states that are working on exchanges won’t have them created by March 1, 2013, this notice requirement has been extended indefinitely.

OSHA Takes Aim at Employer Safety INCENTIVE Programs – What?

Many employers believe that they are furthering safety and health in their workplaces by providing incentives to their workforce for not incurring time-lost injuries.  Many employer have, in good faith, developed programs that will incent their employees for having “X# of days without a lost time accident” by providing prizes, bonuses at the completion of projects or “safety bucks” or other incentives that employees can use to purchase safety gear, or even other items with the earned “bucks.”  Admirable right?  Not in OSHA’s eyes!

In an OSHA memorandum to Regional Managers and Whistleblower Program Managers, dated March 12, 2012, OSHA clearly takes aim at these programs and a huge red flag has to go up to any employers that have adopted such policies and are currently using them.  The Memorandum begins by saying “Section 11(c) of the OSH Act prohibits an employer from discriminating against an employee because the employee reports an injury or illness. 29 CFR 1904.36. This memorandum is intended to provide guidance to both field compliance officers and whistleblower investigative staff on several employer practices that can discourage employee reports of injuries and violate section 11(c), or other whistleblower statutes.”