We’ve developed an easy guide summarizing what your organization needs to know to stay compliant as it begins the New Year. The guide includes a summary of several regulations that take effect as well as important legal issues on the horizon.
Regulations that Take Effect
Below are several major regulations and initiatives will take effect January of 2014.
| Legal/HR Issue | Description of Regulation | Effective Date |
| 2014 Income Tax Withholding Tables | Provides income tax withholding tables for 2014 here. | Immediately |
| Unemployment Benefits | Unemployment benefits extension ends | Immediately |
| Small Employer Tax Credit | The maximum credit is phased out based on the employer’s number of full-time equivalent employees in excess of 10 and the employer’s average annual wages in excess of $25,400 for 2014. | Immediately |
| FSA Limits | The annual dollar limit on employee contributions to employer-sponsored healthcare flexible spending arrangements (FSA) for 2014 remains unchanged at $2,500; however, the new FSA rule dropping the “use it or lose it” requirement takes effect, allowing individuals to carry over up to $500 of their unused account balances from the previous year. | January 1, 2014 |
| HSA Limits | The maximum annual health savings account (HSA) contribution for 2014 is $3,300 for self-only coverage and $6,550 for family coverage in addition to other related limits. | January 1, 2014 |
| ACA Health Plan Design Requirements | New health plan design requirements take effect under the Affordable Care Act (ACA). Health plans:
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January 1, 2014 |
| ACA Wellness Program Incentive Rules | New rules regarding outcome-based wellness program incentives under the ACA, which increase caps on incentives, take effect. Employers can offer incentives of up to 30% of the cost of coverage for programs that have metrics or specific goals, and up to 50% of cost of coverage for programs designed to decrease or prevent tobacco use. Employers must also provide "reasonable alternatives" to outcomes-based wellness programs for employees with medical conditions who may not be able to comply with the wellness program’s requirements. | January 1, 2014 |
| ACA Rules for Defined Contribution Health Care Plans | New rules for applying annual limits and preventative care to defined contribution health care plans take effect including health reimbursement arrangements (HRAs), health flexible spending arrangements, and employer payment plans | January 1, 2014 |
| ACA Individual Mandate | Individual health insurance mandate takes effect under the ACA. All individuals are required to obtain health insurance or pay a penalty. | January 1, 2014 |
| ACA Transitional Reinsurance Fee | Transitional reinsurance fee goes into effect. Health insurance issuers and self-funded group health plans need to pay fees for the first three years of the operation of health insurance exchanges, which will be used to stabilize premiums for coverage in the exchange market. | January 1, 2014 |
| Social Security Withholding | Withholding rates remain at 6.2%. | January 1, 2014 |
| Social Security Wage Base | Increases the Social Security Old Age Survivor's and Disability Insurance (OASDI) taxable wage base for 2014 from $113,700 to $117,000. | January 1, 2014 |
| Minimum Wage | Raises minimum wage in Ohio to $7.95 per hour for non-tipped employees and $3.98 per hour for tipped employees. | January 1, 2014 |
| Mileage Rates | Increases standard mileage rate to 56 cents per mile for business miles driven and 23.5 cents per mile for medical or moving purposes. Continues 14 cents per mile driven in service of charitable organizations. | January 1, 2014 |
| Retirement Plan Limits | The limit on the exclusion for elective deferrals in 401(k), 403(b), and 457(e) plans remains at $17,500, however, certain other limits changed. For changes to other retirement and pension plan limits, click here. | January 1, 2014 |
| VEVRAA Rule Change | New OFCCP rules that amend the Vietnam Era Veterans’ Readjustment Assistant Act (VEVRAA) to expand affirmative action requirements related to the employment of protected Veterans by Federal Contractors. For more information, click here. | March 24, 2014 [NOTE: current contractors with a written affirmative action program (AAP) already in place on the effective date have additional time to come into compliance with the AAP requirements.] |
| Section 503 of the Rehabilitation Act Rule Change (Individuals with Disabilities) | New OFCCP rules that amend the Rehabilitation Act of 1973 and establish (among other items) a nationwide 7% utilization goal for qualified Individuals with Disabilities (IWDs). Federal contractors will apply the goal to each of their job groups, or to their entire workforce if the contractor has 100 or fewer employees; must conduct an annual utilization analysis and assessment of problem areas, and establish specific action-oriented programs to address any identified problems. For more information, click here. | March 24, 2014 [NOTE: current contractors with a written affirmative action program (AAP) already in place on the effective date have additional time to come into compliance with the AAP requirements.] |
Legal Issues on the Horizon
The following table summarizes several major legal issues that could lead to greater scrutiny and more regulations for employers in 2014.
| Legal/HR Issue | Description of Issue |
| Implementation of health care reform | Employers will need to keep pace with preparing for and complying with health care reform provisions, including those set to go into effect this year, and preparing for the employer mandate which hits in 2015. |
| Targeted enforcement of discrimination | The EEOC will continue to focus its efforts on issues of systemic discrimination. Religious, pregnancy, obesity, and transgender discrimination also emerged as important issues last year and will likely carry over into 2014. |
| Social media | More states are passing laws to protect applicants’ privacy on social media websites, specifically making it unlawful for employers to request employees to provide their social media password as a condition of employment. Congress also continues to consider similar federal legislation, but nothing has passed to date. Social media also continues to emerge in case law as evidence supporting employment-law related claims. |
| Workplace leave, sick time, and flexibility | Both state and federal governments have shown interest in expanding workplace leave, sick time, and the prevalence of flexible or alternative work arrangements in the workplace. States are increasingly passing legislation of this nature. Congress continues to introduce related bills. Sick leave, in particular, has made notable progress on the state level. |
| OSHA | The Occupational Health & Safety Administration (OSHA) continues to put into place protections for whistleblowers, as well as for employees working in hazardous workplace conditions. This past year, OSHA focused considerably on safety with hazardous chemicals. |
| NLRB | There was little National Labor Relations Board (NLRB) activity in 2013, but that is expected to change in 2014. Late in 2013, activity already started to pick up as the Board is fully-constituted. |
| Background screening | The Equal Employment Opportunity Commission (EEOC) has continued to target blanket background checks, and more litigation has emerged as a result. More states are enacting “ban-the-box” legislation which forbids employers from asking questions regarding criminal history on job applications. Use of credit checks in background screening is also coming under scrutiny. |
| Increased wage and hour enforcement | Wage and hour lawsuits filed under the Fair Labor Standards Act (FLSA) continue to rise. In addition, misclassification of employees as exempt employees and independent contractors remains a focus of the DOL. |
| Supreme Court decisions | In 2014, the Supreme Court will hear several cases affecting employers’ responsibilities under the Employee Retirement Income Security Act (ERISA), FLSA, the President’s power to make recess appointments to the NLRB, and the whistleblower protections under the Sarbanes-Oxley Act (SOX). |
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