As many employers know, there are a variety of federal laws that impact the workplace. Federal law imposes responsibilities on employers which they should regularly review for compliance. Even well-known laws are frequently updated by regulation, without legislative action. The Federal Laws section covers the following federal statutes:
At a minimum, the federal nondiscrimination laws prohibit discrimination in hiring and firing, promotions, pay, benefits and other terms and conditions of employment. They include:
The Family and Medical Leave Act of 1993 (FMLA) provides job-protected, unpaid leave to employees for their immediate family member’s or their own serious health condition. The FMLA now also provides for leave for family members of covered service members in the Armed Forces for certain reasons. Eligible employees of covered employers (50 or more employees) may not be denied entitled leave, and may not be retaliated against for validly using FMLA leave. There are also comparable family/medical laws in many states.
The federal COBRA law generally requires employers with 20 or more employees who offer group health plans to offer employees, their spouses and their dependents continued health coverage following termination of their coverage under the group plan (so long as the plan itself continues). Employers of fewer than 20 employees that are not covered by COBRA may still have similar continuation of coverage responsibilities under their State law.
The federal HIPAA law requires group health plans (including employer-sponsored plans) to issue documents demonstrating an insured’s period of coverage that can be credited against any pre-existing condition period. These documents are called certificates of creditable coverage. A certificate must be issued automatically and free of charge when an individual:
For more on creditable coverage and HIPAA in general, please visit the HIPAA Section (link to new HIPAA section).
The Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code govern the establishment, operation and administration of retirement plans. After employee stops working for a company, an employer-sponsored retirement plan may need to comply with retirement distributions or responsibilities relating to “rolling over” a former employee’s assets to another plan or fund. For more on these and other rules related to ERISA-covered retirement plans, visit the Retirement Plans Section by clicking here (link to new Retirement Plans section).
The Federal Unemployment Tax Act (FUTA), with state unemployment systems, provides for payments of unemployment compensation to workers who have lost their jobs. Most employers pay both a Federal and a state unemployment tax.
Note: This overview is not an exhaustive list or explanation of federal or state laws, regulations or case law that affect employee terminations. Rather, these brief descriptions are intended to highlight a few key areas for employers to be aware of. For more guidance, please visit other Sections, or for specific matters, seek the advice of employment counsel in your local jurisdiction.
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