Will Amazon, Berkshire Hathaway and JP Morgan Change Healthcare for Employers?

Contributed by Suzannah Wilson Overholt, February 19, 2018

What happens when you combine Amazon, Berkshire Hathaway and JPMorgan Chase? Apparently, a new non-profit health care company. That was the news last month when the three companies announced that they are forming their own health care company to increase transparency for their employees.

Health Insurance and Money

Health insurance policy and dollar bills on white background 

Anyone involved with employee benefits knows that one of the most dreaded moments annually is getting the renewal quote for the health benefit plans. The quote starts the agonizing dance of trying to get the astronomical increase to a manageable number while calming the budgeting folks, panicked by the opening salvo. The idea of somehow removing the mystery and agony of that process is incredibly appealing. But is it possible? Maybe.

The push for transparency appears to be aimed at the elimination of the overhead costs that are built into the health insurance expense. According to the Wall Street Journal, the new venture plans to help current vendors work better by focusing on technology solutions, improved patient experience and customer service.  Initiatives might include flat fees and using technology to provide more tracking and care outside traditional health-care settings. The final outcome could result in providers being adequately paid for the services they provide, new technology for streamlining services, and reduced costs due to elimination of unnecessary overhead charged by the insurance companies.

While the new company will be focused on the employees of its founders, its success will likely have a ripple effect. The companies hope the project will save them hundreds of millions of dollars and possibly be a blueprint for others.

The gain for employers would be a potential reduction in the cost of insurance, which, as reported by SHRM, currently consumes on average around 10% of operating budgets. While CNN reports that the rate of increase has slowed over the past few years, a recent study found that employers expect health care costs to increase by more than 5% this year. Thus, reduced costs could eliminate the annual debate between giving raises or keeping insurance contributions in check.

Don’t expect changes anytime soon, though. The existing insurance marketplace has big players with the infrastructure to provide services to millions of people. The new company will have to prove itself. We’ll keep you posted.

 

I Heart You! Office Romance and Risk Management

Contributed by Beverly Alfon, February 13, 2018

As most turn their thoughts to love and romance this Valentine’s Day, we remind you of the potential liability that Cupid’s arrow may unleash. In this post-Weinstein and #MeToo period, the thought of office romance may catapult an employer into sheer panic. Although a recent CareerBuilder survey indicates that office romance is at a 10-year low, the stats are still telling: 36% of workers admitted to having dated a colleague in the past year. Of workers who had an office romance, 30% dated someone in a higher position. Yikes. A soured relationship at work can result in a broken heart for the employer – usually in the form of a sexual harassment claim. How can an employer address this?

A Love Contract?

heart

Red outline of heart on white background

These things exist. They are written relationship agreements that employers seek from employees to confirm the existence of a consensual relationship. The employer’s goal is to mitigate risk by documenting the employer’s expectation that they comply with all existing policies, including anti-harassment policies. They can also be used to set ground rules for other conduct, including public displays of affection (PDA), favoritism – and retribution (in case the relationship turns sour).  However, while these contracts can be a good “band-aid” for addressing the relationship, if a company does not have an anti-harassment program or policy regarding office relationships; it is not the best option.

A love contract alone will not likely defeat an employee’s claim of harassment. Most sexual harassment plaintiffs can claim that they were coerced into signing one because their employer presented the agreement in the context of their at-will employment. Practically, a love contract is also difficult because it requires employees to admit to the existence of a relationship in the first place. In the same CareerBuilder survey, 41% of the workers kept their romance a secret – and almost 25 of survey respondents admitted to an affair with a colleague where one person involved was married at the time.

Snap out of it!

You can more effectively mitigate legal risk by focusing on your anti-harassment program. If you don’t have a written policy in place, invest the time and dollars to get one. Having a policy on the books is not enough. It should be supplemented with annual interactive training courses (a legal requirement for California employers) – ones tailored for non-supervisory and supervisory employees. The goal is to document that employees have been trained on the internal complaint procedures. Equally important is training your supervisors on how to avoid harassment claims and how to properly handle claims if the supervisor receives knowledge of a claim. A solid anti-harassment/discrimination program demonstrates employer good-faith and can form a defense against such claims.

A general workplace romance or “fraternization” policy can address concerns over PDA and favoritism. Don’t play footsie over this. Specifically address office relationships to make it clear that you expect professional and respectful behavior of all employees, regardless of any personal relationship between them. You can prohibit PDA in the office or on company time. And yes, you can forbid romantic relationships between supervisors and subordinates. According to a 2013 survey conducted by SHRM, of businesses that had a romance policy, 99% banned supervisor-subordinate relationships. And, it’s no wonder. In addition to harassment claims, soured relationships can result in claims of assault and battery, false imprisonment and defamation against the alleged harasser. Inevitably, the employer will be rolled into any related litigation.

Bottom Line: Love contracts are uncomfortable and not very effective.  It is more effective to prohibit the risky conduct in the first place. Implementing a strong anti-harassment program and addressing employee relationships in a policy will go further in mitigating risks.

 

In 2018, Resolve to Keep Employment Records Secure

Contributed by Noah A. Frank, February 8, 2018

Though hacked systems are alarming, too often, data breaches come from much more obvious sources, such as computers without passwords (or weak ones), files left sitting out on desks, and even briefcases left on airplanes (like Department of Homeland Security analysis of terrorist threats at the Super Bowl). An employer’s exposure for data breaches can be significant. At minimum fines, civil suits (including class actions), lost trust and bad publicity, and remediation costs.

Data breach 2

Lock on a computer keyboard

In 2017 alone, some of the major headline data breaches include the Paradise Papers and Panama Papers scandals (two data breaches totaling 3.9TB of data and 24.5M documents), a credit reporting agency, a telecom provider and a wholly owned web service provider. As we previously discussed, employers are obligated through various statues and regulations to keep and maintain many types of employment records containing significant personal, confidential, and highly sensitive information. Such records range from job applications and resumes, to tax forms and benefits applications, to medical records stemming from workers’ compensation, disability, and FMLA claims. These records contain employees’ (and their dependents’) addresses, phone numbers, social security numbers, dates of birth, banking and financial information, and highly sensitive medical information. Other internal files may contain client information, usernames, and even passwords that employees keep the same across work and personal accounts. In short, employers maintain all of the information necessary to completely hack sensitive information exposing all employees to possible identity theft, or other adverse use of their private information. 

Data Security in the 21st Century

The significant data breach risks require companies to practice good record maintenance hygiene. Some important and simple steps to follow in 2018 include:

  • Secure electronic systems: restrict access to necessary programs, folders, and files, with employees using unique, memorable passwords/passphrases. Perform a physical “audit” to ensure employees are not storing passwords beneath keyboards (yes, it still happens!).
  • Utilize protection: lock offices, install privacy screen filters, keep files secured. Remember, a data breach can be as simple as one prying employee looking in another’s file left on a desk – or the cleaning service pocketing an entire file.
  • Keep communications confidential: avoid unintentional disclosure through speakerphone and group printers.
  • Enable remote wipe capabilities in case portable devices are lost, stolen, or otherwise compromised.
  • Plan for the unexpected: establish protocols to secure systems and maintain data integrity should it be necessary to terminate an employee, including the chief technology officer, and how to handle a data breach should it occur.
  • Engage legal counsel as necessary to perform audits of policy and practice, address high risk situations to ensure legal compliance, and shepherd remediation and handle concise communications if and when a breach occurs.

Through strategic planning and implementation of security policies and protocols, companies can be prepared to efficiently address situations in a fluid and dynamic manner without impeding operations.

 

Universities and International Students May Still Benefit Amid Uncertain Immigration Future

Contributed by Jacqueline Lentini McCullough, February 2, 2018

After a decade of rapid growth which saw the international student population increase 85 percent to over a million students, the number of newly arriving international students fell 3 percent in the 2016-2017 academic year.

President Trump’s campaign rhetoric and subsequent action as President have contributed to substantial declines in international student enrollment for the current academic year. Across the country the number of new international students declined an average of 7 percent according to a study of about 500 campuses by the Institute of International Education, with 45 percent of campuses reporting at least some decrease.

41338099 - celebration education graduation student success learning conceptI encourage education and university clients, and any employer hiring international students to be calm and take a breath.  One thing I have noticed about President Trump’s actions is that they have been very consistent with his campaign promises: border enforcement and bans. He wants to move to a merit-based immigration system similar to Canada and Australia.

If the U.S. does move to a merit-based immigration system, international students may gain an advantage. A merit-based system is point-based and prizes highly educated immigrants. Who would be better positioned than those who gained a U.S. college education?

In fact, Sen. Orrin Hatch and Sen. Jeff Flake introduced a bill in the U.S. Senate last week, the Immigration Innovation (I-Squared) Act of 2018, to allow as many as 195,000  H-1B visas. The proposal would increase the number of H-1B visas by 110,000 (from 85,000), while awarding U.S. advanced degree-holders expanded priority in the selection process.

As colleges regroup to recruit internationally in this context, it is recommended that they approach prospects with an eye toward the H-1B visa that international students will ultimately want to apply for.  These are students who:

  • Intend on a STEM major: Engineering majors are the safest bet.
  • Plan to work in a STEM field or true specialty occupation: Qualifying occupations include doctors, lawyers, teachers and engineers.

Unfortunately, unless a student wants to teach a foreign language, liberal arts students are unlikely to qualify for an H-1B visa.

Colleges may even want to use the possible advantage of U.S. college education in a merit-based immigration system as a recruiting point.

U.S. colleges, universities and employers can weather this intense immigration storm by staying calm and focusing their recruitment on the areas most likely to succeed with visas.

H-1B Applicants, Start Your Engines

Contributed by Jacqueline Lentini McCullough, January 31, 2018

If you are planning to file H-1B applications for your employees this year, now is the time to start the process. While the filing deadline is April 2, 2018, it’s not too early to begin the application, which involves several time consuming steps. As in recent years, the H-1B cap season may be met with an overwhelming number of petitions within a week of the April 2nd deadline. If you plan to file for an H-1B visa this year, starting early will enable us to provide your petition with the best possible shot at winning the lottery and obtaining a visa. We recommend starting to prepare the H-1B application by February 12th.

 

Save the Date! SmithAmundsen Complimentary Webinar – February 21st – Directives From the Board Room: Will Your HR Team Fail or Save the Day?

Join Eric Fogel and Beverly Alfon on Wednesday, February 21 at 12:00 PM CT for the latest installment of our Labor & Employment Quarterly Series. The board of directors helps develop the strategic vision and management of a business. These corporate governance directives are necessary, but can lead to unintended consequences for HR. Eric and Beverly will discuss real life situations where directives from the board room landed squarely on the shoulders of HR and how those HR teams were the hero or the failure of those situations.

Register for the webinar here!

Save the Date! SmithAmundsen Complimentary Webinar – February 1st – Is Your Employee Handbook Ready for 2018?

Join Suzanne Newcomb on Thursday, February 1st at 12:00 PM ET for a complimentary webinar on ways to ensure your employee handbook is an asset and not a liability to your organization. During the webinar Suzanne will discuss current best practices for:

  • EEO and accommodation policies and complaint procedures
  • Work rules and the shifting tide at the NLRB
  • Attendance and leave policies
  • Compensation and payroll policies
  • And more!

Register for the webinar here!