News from Ollis/Akers/Arney Human Resources Consulting

Wide-Ranging Executive Order on AI

with Serious Implications for Employers

On October 30, 2023, President Joe Biden signed an executive order (EO) on artificial intelligence (AI) in an effort to establish a “coordinated, Federal Government-wide approach” to the responsible development and implementation of AI.

As various state, local, and international jurisdictions continue to propose and enact legislation relating to AI, the Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence is the first broad-based roadmap of the federal government’s approach to the quickly developing AI space.

Consistent with trends in other AI-regulatory developments, the Biden Administration’s focus is on both procedural safeguards surrounding AI (such as auditing/vetting of AI tools) as well as substantive safeguards (steps designed to ensure, for example, equity and fairness in the use of AI tools).

A core theme of the EO is the inherent tension between the promise of AI to help “solve urgent challenges while making our world more prosperous, productive, innovative, and secure” with the potential perils of irresponsible use “such as fraud, discrimination, bias, and disinformation.” The EO lays out the administration’s initial playbook for balancing these promises and perils by encouraging the development of AI through various mechanisms while also setting in motion exploratory steps to impose checks and balances on AI use/development.

As companies increasingly utilize and rely on AI for a variety of purposes, including making employment decisions, guidance from various regulatory bodies will continue to issue. Employers may want to consider reviewing their current and planned use of AI and the impact on employees in light of increasing federal scrutiny and carefully watch for additional forthcoming guidance.

Read the Ogletree Deakin article HERE

Final Forms and Instructions for 2023 Reporting Released

The 2023 instructions include information on the new electronic filing threshold for information returns required to be filed on or after Jan. 1, 2024, which has been decreased to 10 or more returns (originally, the threshold was 250 or more returns).

Employers should become familiar with these forms and instructions for 2023 calendar year reporting and begin to explore options for filing ACA reporting returns electronically.

Get More Details HERE

NLRB Issues Final Rule on

Joint-Employer Status

On October 27, 2023, the National Labor Relations Board (NLRB) published its final rule on the standard for determining joint-employer status under the National Labor Relations Act, effective December 26, 2023. The new rule rescinds the Board’s 2020 rule and hearkens back to a more common law approach promulgated in Browning-Ferris, 362 NLRB 1599 (2015). The rule has been classified as a major rule and is subject to Congressional review.

The Rule

Under the new final rule, an entity may be considered a joint-employer of another employer’s employees if they share or co-determine employees’ essential terms and conditions of employment.

What are the essential terms and conditions in determining whether employers are joint-employers?

The SEVEN essential terms and conditions to consider in determining whether employers are joint-employers, which are rooted in common-law agency principles, are enumerated in the final rule as:

Wages, benefits, and other compensation
Hours of work and scheduling
The assignment of duties to be performed
The supervision of the performance of duties
Work rules and directions governing the manner, means, and methods of the performance of duties and the grounds for discipline
The tenure of employment, including hiring and discharge
Working conditions related to the safety and health of employees

If an organization has the authority to control at least one of the above, whether or not it exercises the authority, the NLRB will find the employers to have met the joint-employer standard. Indirect control alone may prove joint employer status, even if such control has not been exercised. The rule further requires joint-employers to negotiate over those terms “it possesses the authority to control or exercises the power to control.”

Read the entire article here

UPDATE: NLRB delays effective date of "joint employer" regs until late February

Read the Legal Bulletin HERE

Boost Employee Satisfaction with HDHPs

High-deductible health plans (HDHPs) have become a mainstay of many employee benefits programs since their introduction in the early aughts.

However, despite two decades of experience with these plans, employee satisfaction with HDHPs lags behind that of more traditional health plans. Data from the Employee Benefit Research Institute /Greenwald Research Consumer Engagement in Health Care Survey, for instance, found that 66 percent of employees enrolled in a traditional health insurance plan are extremely or very satisfied with their plan, compared with 52 percent of those enrolled in an HDHP.

If employers are to capture the full promise of a more consumer-driven approach to health care, they need to understand why employees might be frustrated with HDHPs.

SHRM article HERE

PCORI Fee Amount Adjusted for 2024

The Internal Revenue Service (IRS) has issued Notice 2023-70 to increase the Patient-Centered Outcomes Research Institute (PCORI) fee amount for plan years ending on or after Oct. 1, 2023, and before Oct. 1, 2024. The updated PCORI fee amount is $3.22 multiplied by the average number of lives covered under the plan. For plan years that ended on or after Oct. 1, 2022, and before Oct. 1, 2023, the PCORI fee amount is $3.00 multiplied by the average number of lives covered under the plan.

The PCORI fee was created by the Affordable Care Act (ACA) and first applied for plan or policy years ending on or after Oct. 1, 2012. The fee is imposed on health insurance issuers and self-insured plan sponsors to fund comparative effectiveness research. The PCORI fee was originally scheduled to expire in 2019. However, a federal spending bill extended the PCORI fee for an additional 10 years. The PCORI fee will apply through the plan or policy year ending before Oct. 1, 2029.

Read article HERE

Health FSA Limit Increases

for 2024

On Nov. 9, 2023, the IRS released Revenue Procedure 2023-34 (Rev. Proc. 23-34), which includes the inflation-adjusted limit for 2024 on employee salary reduction contributions to health flexible spending accounts (FSAs). For plan years beginning in 2024, the adjusted dollar limit on employees’ pre-tax contributions to health FSAs increases to $3,200. This is a $150 increase from the 2023 health FSA limit of $3,050.