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A Better Partnership


Oct 2016
October 10, 2016

News Digest

  • NLRB Allows Unions to Include Temps in Organizing Efforts
    Since 2004, the National Labor Relations Board (NLRB) has not allowed a union to organize a bargaining unit that mixes regular employees with those employed by a temporary agency unless both employers agreed. The NLRB recently reversed precedent and will allow unions to organize mixed units containing both temporary and regular employees. Now a union does not need both employers’ consent, so a union can use temporary employees as leverage to organize the client employer’s workforce. 
  • How to Properly Discipline an Employee Who Recently Returns from FMLA
    Discipline of an employee with recent FMLA leave can create a quandary. You can’t ignore the problem, but don’t want to get hit with a “retaliation” lawsuit. The good news: a court just upheld a termination for timecard fraud shortly after an employee’s return from FMLA leave. The employer supported the termination with timecards, plaintiff’s own statements, building entry and exit records and computer login records. Employers can take appropriate action in these situations. The key is that discipline must be well documented and consistent with treatment of other employees.
  • Ceasing Retirement Plan Contributions Requires Full Vesting
    The IRS recently issued a reminder that if a company has not made contributions to a retirement plan in at least three of the past five consecutive years, then the plan may be viewed as completely discontinuing contributions and required to fully vest all participants. Employee deferrals do not count for this purpose. If a plan has made partially vested distributions when the participants should have been fully vested, there is a correction procedure to restore the previously forfeited accounts, adjusted for lost earnings.
  • DOL Penalties for ERISA Violations Increased August 1, 2016
    The Department of Labor (DOL) recently increased the maximum penalties it may impose for ERISA violations. The new rules also include an automatic inflation adjustment by January 15 of each year starting in 2017. Although some penalty adjustments were modest, other penalties significantly increased. For example, the penalty for failure to file a Form 5500 was increased from $1,100/day to $2,063/day. The combination of increased DOL audit activity and penalties highlights the importance of ERISA compliance.

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