Why Should I Care About the Department of Labor’s Employee Benefits Security Administration?

 

“Why should I care about the Department of Labor-Employee Benefits Security Administration?” It’s a good question. As a business owner, if you sponsor a retirement, health or cafeteria plan you’re about to learn why you should.

The responsibility of the Employee Benefits Security Administration (EBSA) is to safeguard over $9.9 trillion in assets maintained in approximately 703,000 pension and retirement plans and 2.3 million health and welfare plans. This is accomplished by a relatively small cadre of investigators and auditors who probe for a wide range of violations. If an investigation reveals a violation of ERISA (Employee Retirement Income Security Act of 1974), EBSA takes action to obtain correction of the violation. When voluntary compliance is not achieved, EBSA may refer a case to Department of Labor (DOL) attorneys for litigation. Plan assets recovered by EBSA go directly back to the plans and participants involved; penalties go to the government. DOL may also provide information to any persons affected by a breach of ERISA (i.e., IRS, HHS, state insurance departments, parties involved in litigation against your plan).

·       RELATED: The Top 10 HR Mistakes Employers Make.

(By the way, that $9.9 trillion in ERISA plans represents the single largest block of tax favored money on Earth. Consequently, it gets a tremendous amount of attention from the DOL, the IRS, SEC, HHS and all 50 state insurance commissioners. That includes your little piece of that pie, and by extension, YOU as the plan sponsor.)

The DOL has the power to impose civil and criminal penalties and fines and to coordinate with the Justice Department to prosecute criminal violations or litigate large civil matters. For you, as the subject of this attention, it can quickly become a costly matter in terms of money, time, effort and aggravation.

The best way to keep your risk profile as small as possible regarding your ERISA qualified benefit plans is to proactively manage them in compliance with all applicable statutes and regulations. This includes respecting and protecting participant and beneficiary rights, proper management of assets, oversight of service providers and the myriad reporting and disclosure rules. In the end, even if it is a service provider to your plans who violates ERISA, as the plan sponsor the responsibility and liability will always fall into your lap.

Therefore, a suggestion on what amounts to “cheap insurance” – consider engaging a consultant to conduct a thorough analysis of your entire benefits program to identify potential areas of concern and to assist you in designing a “best practices” regimen of policies and procedures to get, and keep, your benefits programs in compliance. As a plan sponsor, you should be proactive in protecting yourself, your business, your plans and your employees.

Disclaimer: This document is not intended to be taken as advice regarding any individual situation and should not be relied upon as such. The Gertsburg Law Firm Co., LPA and Marsh & McLennan Agency LLC shall have no obligation to update this publication and shall have no liability to you or any other party arising out of this publication or any matter contained herein. Any statements concerning actuarial, tax, accounting or legal matters are based solely on our experience as consultants and are not to be relied upon as actuarial, accounting, tax or legal advice, for which you should consult your own professional advisors. Any modeling analytics or projections are subject to inherent uncertainty and the analysis could be materially affective if any underlying assumptions, conditions, information or factors are inaccurate or incomplete or should change.

Frank J. Bitzer, Director of Legal Compliance & Employee Health & Benefits at Marsh & McLennan Agency LLC. He can be reached at frank.bitzer@marshmma.com.

Charlie Filisko is Vice President of Property, Casualty & Surety at Marsh & McLennan Agency LLC. He can be reached at charlie.filisko@marshmma.com.

Alex Gertsburg is the CEO and Founder of the Gertsburg Law Firm Co., LPA. He can be reached by email at ag@gertsburglaw.com or by phone at 440-571-7775.

Stop worrying if your company is vulnerable to lawsuits or liability and schedule a confidential, no-cost CM6 Vulnerability Check with Gertsburg Law Firm. CEO Alex Gertsburg will walk you through the minefields in your documents and key processes and tell you how to fix them yourself. Call 440-571-7774 or e-mail cz@gertsburglaw.com to schedule your CM6 Vulnerability Check today. Explore the full CoverMySix legal audit suite at covermysix.com.

Securities offered through MMA Securities LLC (MMA Securities), member FINRA / SIPC, and a federally registered investment advisor. Main Office: 1166 Avenue of the Americas, New York, NY 10036. Phone: (212) 345-5000. Variable insurance products distributed by MMA Securities LLC.  MMA and MMA Securities are affiliates owned by Marsh & McLennan Companies.

 

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  • Next up: Why You Should Hire High School Interns
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  • Why You Should Hire High School Interns

    Why should you as an employer consider welcoming high school students as interns in your company? As part of the 2018 Cleveland Internship Summit, representatives from local companies, schools and youth-workforce intermediary organizations served as panelists to discuss their experiences with high school internship programs and share advice on the process.

    Participants in the 2018 Cleveland Internship Summit panel, Why Employers Should Consider High School Students for Their Internship Programs, included moderator Joe Spiccia, superintendent of Wickliffe City School District; Craig Dorn, senior vice president at Youth Opportunities Unlimited; Zerrine Bailey, emerging talent network leader at JumpStart; Karyn McAdams, human resource team leader at Parker Hannifin; and Marzell Brown, talent management lead at Rockwell Automation. The focus of the discussion was intended to help the audience understand the elements that make a high school internship experience successful for all parties involved.

    Why a high school internship program could benefit your company

    While some companies might not even realize it’s possible to hire teens as interns, others might be hesitant to do so due to some common misconceptions related to these types of programs, including that high school students are too young, they aren’t ready for this type of experience, they aren’t capable of the work involved or that they don’t have enough to contribute to the internship experience.                

    The panelists identified several reasons why those thoughts on hiring younger interns are not accurate, including the following benefits that they bring to an organization:

    Benefit No. 1: Valuable work. Students at this age are learning things at an earlier and faster rate than many adults. They have a keen interest in and experience with different areas of technology, and can pick up new things quickly.

    Benefit No. 2: New ways of thinking. Having input from varying ages and levels of experience can help improve the energy in your company and add to the diversity of thought and actions your company takes. These younger workers can help improve your brand awareness and appeal to a younger audience.

    Benefit No. 3: Management opportunities. Having high school interns on staff can be a great experience for your college interns. It can give them the opportunity to take on a management and mentorship role when it comes to working with the younger students.

    Benefit No. 4: Workforce development. Your high school intern could very well become a part-time employee while they work their way through a local college program, and then potentially become a future full-time employee with solid work experience.

    Benefit No. 5: Community partnerships. When you begin an internship program for high school students within your company, you have the potential to create long-term sustainable partnerships with valuable organizations and schools within your community.

    How to go about creating a high school internship program

    As companies begin to consider creating a high school internship program, it’s helpful to understand how schools are preparing their students for internships. Many schools offer opportunities to focus on specific industries such as culinary arts, healthcare and more so that students can acquire hands-on skills they will need in the real world. Schools are also bringing in companies to do things like mock interviews, resume writing and job shadowing. These partnerships can be invaluable for, not only the students, but also for the schools and the companies themselves.

    The panelists offered some thoughts on how employers might onboard or supervise high school interns differently than college interns and regular staff members, including:

    • Holding orientation in a more relaxed setting that appeals to and better engages younger workers;
    • conducting separate trainings for each high school intern to establish a connection and ensure they have a thorough understanding of expectations and have their specific questions answered;
    • realizing that, for paperwork purposes, younger students may not have a photo ID, a driver’s license, and other things that are more commonly expected from older hires;
    • understanding that transportation can be a challenge and helping ease this issue by providing bus passes, allowing remote working opportunities or creating ride share options;
    • connecting the interns with specific employees who are excited about working with high school students and who are not biased against their younger age;
    • helping interns build their “soft skills,” such as the importance of being on time, how to communicate in a professional setting, how to take constructive criticism, how to dress, and other things that usually come with experience;
    • ensuring you have clearly defined projects for the interns to work on and clearly identified timeframes in which they will conduct their work; and
    • checking in with your high school interns one-on-one on a regular basis, and providing “light-weight” performance reviews periodically so that they have an understanding of that part of the job process, as well as regular feedback on their performance.

    All panelists advised working with a third-party intermediary group, such as Youth Opportunities Unlimited. Using a broker can help your company go through the process of creating a program and filling your intern staffing needs, as well as assisting you in overcoming any potential challenges that might exist when hiring interns from this particular age group. For a deeper dive into how to create and manage your company's internship program, check out the Greater Cleveland Partnership's Internship Central page.

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  • Next up: Why You Should Offer Health Care Coverage to Your Employees
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  • Why You Should Offer Health Care Coverage to Your Employees

                                                                   

    As a small business owner, you may be deciding if you want to offer health care benefits to your employees. From recruiting and retaining talent to saving your company tax dollars, offering health care benefits can be a win-win situation for both you and your employees. 

    Attract talent

    Many companies offer health care for recruiting and retention purposes to make sure they are attracting the best talent for the job. According to Glassdoor, the top three benefits that make employees the most satisfied include health insurance, paid time off and retirement plans (Glassdoor Economic Research, 2016). Covering these types of benefits will help boost employee morale and productivity on the job.

    Save money

    Offering health care benefits will actually help you save money. Employers and employees pay less for health insurance when it is purchased at a group level because it can be paid for with pre-tax dollars. When you and your employees contribute to premiums, health savings accounts (HSAs) and/or health reimbursement accounts (HRAs), there are even more tax benefits available.

    Network access

    Group health plans often have access to larger networks of doctors and hospitals compared to an individual plan on the public exchange. This can be really important for employees who have already established care with certain providers and don’t want to lose these relationships through a smaller network.

    There’s already a great option for you

    As a COSE member, you have access to the COSE multiple employer welfare arrangement (MEWA) through Medical Mutual. The COSE MEWA is designed as a self-funded benefit option for businesses with 50 or fewer employees. The COSE MEWA was developed to help small business members and their employees manage the increasing cost of healthcare benefits. Talk to your broker or read this article to see if this benefit option makes sense for your business. In addition to the COSE MEWA, you also have access to Affordable Care Act benefit plans with a state premium tax savings through COSE.

    A broker can help

    It may seem complicated to coordinate health insurance benefits for your employees, but it’s actually easier than you think. A broker can guide you through the process and help find the best health plan for you and your employees. If you don’t have a broker, Medical Mutual can help you find a reputable one through our broker network.  Please click here to get started.

    Glassdoor Economic Research. (2016, June 2). New Glassdoor Research Reveals Health Insurance Has Greatest Impact on Employee Satisfaction With Overall Benefits Packages in U.S. [Press release]. Retrieved from https://www.glassdoor.com/press/glassdoor-research-reveals-health-insurance-greatest-impact-employee-satisfaction-benefits-packages/

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  • Next up: Will Changes to Canadian Trademark Laws Impact Your Business?
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  • Will Changes to Canadian Trademark Laws Impact Your Business?

    If you conduct business in Canada or are a trademark owner in Canada, it's imperative that you are familiar with changes on the horizon for Canadian trademark laws, specifically with registration and fees.


    Beginning June 17, 2019, sweeping changes to Canadian trademark laws will finally be in effect. United States entities that conduct business in and are trademark owners in Canada should be aware of some of these key changes, which aim to align Canadian practice with those of other jurisdictions worldwide.

    Requirements of Filing Applications and the Prosecution Process

    First, new Canadian applications will be required to comply with the classification system of goods and services that is already used in the U.S. Historically, Canadian applications had all goods and services included together. This change means that attention will need to be paid to the various classes of goods and services with which U.S. trademark registration owners should already be familiar.  

    Second, new trademark applications filed in Canada will no longer have to include dates of first use. Furthermore, asserting actual use will not be required for a trademark application to proceed to registration. As a result, an intervening party could potentially secure a Canadian registration without proving use in Canada.  In other words, there could be an increase in squatters or trolls obtaining Canadian trademark registrations, to the detriment of valid Canadian trademark owners. A valid trademark owner in Canada might have to address this intervening registrant, which could complicate the owner’s ability to secure its own registration in Canada. This emphasizes the importance of filing applications in Canada sooner rather than later when there is trademark use in Canada, or when it is anticipated in the near future. There will clearly be an increased value in “first to file” under the new Canadian system.

    Third, the expansion of Canadian laws to help protect non-traditional trademarks (such as colors, scents, tastes and moving images) is an interesting development. Other jurisdictions, including the U.S., have already been affording protection to non-traditional trademarks, so this will be a welcome change that will increase the range of Canadian trademark protection. However, non-traditional trademarks will still be subject to examination for distinctiveness, much like in the United States. It could therefore prove difficult to obtain registrations of non-traditional marks unless the trademark owner can provide substantial evidence of extensive use and promotion in the Canadian market.

    Registration Term and Renewals

    The term of a Canadian trademark registration will be 10 years for registrations issued after June 17, 2019, instead of the 15-year term that exists under the current system. The term for registrations that are already in existence before June 17, 2019 will remain at 15 years. Importantly, they will not be converted to a 10-year term until the next renewal deadline arises. Furthermore, any Canadian registration renewed after June 17, 2019 will need to be amended to place the goods and/or services into appropriate separate classes. This means that there could be a cost savings in renewing a Canadian registration prior to June 17, 2019.

    Fees

    The adoption of the classification system mentioned above will require the creation of a new filing fee system. As is done in the United States, the trademark application filing fee will be based on the number of different classes of goods and services. In the new Canadian system, this fee will be $330 (CDN) for the first class, plus $100 (CDN) for each additional class of goods and/or services. This is a significant change; instead of having a single filing fee, regardless of the number of classes of goods and services, new applications could have drastically higher filing fees if many different classes are included. The current $200 registration fee, however, will be eliminated.

    It may be worthwhile for U.S. trademark owners to review and audit their own portfolio to determine if any cost-savings steps should be taken before June 17, 2019. If you have trademark questions or concerns, either in the United States or in Canada, please reach out to our intellectual property team. We’d be happy to help.

    Sean Mellino is an attorney with Walter | Haverfield who focuses his practice on intellectual property law. He can be reached at smellino@walterhav.com or at 216-928-2925. 


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  • Next up: Workers' Comp: What to Know About Starting, Buying or Moving Your Business
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  • Workers' Comp: What to Know About Starting, Buying or Moving Your Business

    If you are looking to start a new business, buy an existing business or move your business, there are some things you need to know about workers’ compensation coverage. 

    If you are looking to start a new business, buy an existing business or move your business, there are some things you need to know about workers’ compensation coverage. 

    If you are starting a business and plan to have at least one employee, you need to apply for coverage through the Ohio Bureau of Workers’ Compensation (BWC). The most efficient way to do this is online through the BWC website (www.bwc.ohio.gov). Once you apply for coverage, you can take advantage of the Grow Ohio Incentive Program to obtain discounts on your premiums by joining a Group Rating Program. 

    If you are planning to buy an existing business, you need to know a few things. First of all, if you acquire the assets of an existing business—in whole or in part—the workers’ compensation experience of the current owner (predecessor) will be transferred you (successor). This is a BWC policy called Successor Liability. In order to have an idea of what will be in store for you, you can complete a Request for Business Transfer Information (AC-4) form. This needs to be completed and signed by both parties and allows you, as the buyer, to view any outstanding liabilities as well as the risk experience that you will inherit.

    Even if you are not acquiring a business, but are simply moving into a location that was previously occupied by a similar business (i.e., a restaurant), you should try to contact the previous business owner to sign off on the AC-4 so that you are prepared in the event the BWC determines you are a successor.

    If all goes well and you go forward with the acquisition, you are required to notify the BWC by completing a Notification of Business Acquisition/Purchase Merger/Sale (U-118). This can also be completed on the BWC website. 

    Finally, if you are making any changes in your business—changing name or DBA, adding a partner, changing the address or contact information—you need to complete a Notification of Policy Update (U-117). As with the other forms, the U-117 can also be completed online through the BWC website.   

    The Greater Cleveland Partnership and COSE have a team of workers’ comp experts that can help you navigate the complex world of workers’ compensation n and can also help you save money on your premiums through our Group Rating Program.  Call us at 216-5920-2351 or send an email to workerscomp@cose.org if you need some assistance or would like more information about all the ways we can help you.  You can also visit our workers’ comp webpage. www.cose.org/workerscomp

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  • Next up: Workers’ Compensation Prospective Billing: Important Developments starting this May
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  • Workers’ Compensation Prospective Billing: Important Developments starting this May

    After decades of charging Ohio businesses workers’ compensation premiums after coverage has been extended, the Ohio Bureau of Workers’ Compensation (BWC) will be transitioning to a prospective premium collection model this year. The new billing system is designed to provide more flexibility for employers while reducing overall system costs to the state. The change also aligns the BWC with the standard insurance industry practice of collecting premiums before extending coverage (e.g. property & casualty, general liability, etc.)

    After decades of charging Ohio businesses workers’ compensation premiums after coverage has been extended, the Ohio Bureau of Workers’ Compensation (BWC) will be transitioning to a prospective premium collection model this year. The new billing system is designed to provide more flexibility for employers while reducing overall system costs to the state. The change also aligns the BWC with the standard insurance industry practice of collecting premiums before extending coverage (e.g. property & casualty, general liability, etc.)

    This change to prospective billing goes into effect on July 1, but there are some developments in May that are important to note.

    In late May, BWC will mail all private employers a notice of estimated annual premium. This notice will be based on your reported payroll for July 1, 2013, to June 30, 2014. It is not a bill, but please review it for accuracy and contact BWC if you feel something is incorrect. This payroll will be used as the basis of your 2015 premium.

    If you would like additional information, the BWC website has details about the changes  and programs. Visit www.bwc.ohio.gov. Click on the Employers tab on the menu. Then select Prospective Billing under the Featured Links tab. You can also contact COSE’s Workers’ Comp team at 216-592-2351.

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