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The Pensions Regulator (TPR) announced that for the first time ever the number of participants in defined contribution plans in the UK outnumbered those in defined benefit funds, primarily due to automatic enrollment.

In the annual DC report, TPR said defined contribution arrangements had 14.8 million participants (2016).  Defined benefit plans only amounted to 11.7 million.

Executive director for regulatory policy, Andrew Warwick-Thompson, said that 7 million workers joined pensions for the first time thanks to automatic enrollment.  Warwick-Thompson however, did express concerns over the fragmentation of defined contribution arrangements.  He said, “we strongly believe that it is unacceptable to have two classes of DC pension saver – those that benefit from the premium scale and good governance and administration, and those that do not.”         

Details of a trustee initiative will be released later this year and will include clear objectives that will help raise standards of trusteeship and take regulatory action against those who fail to meet a required level of competence.

Since the government’s pensions freedoms were introduced in April 2015, savers have cashed in £9.2 billion from their pension pots.

According to recently released HMRC figures, over 1.5 million payments have been made using pension freedoms.  Additionally, 162,000 people accessed £1.56 billion flexibly from their pension pots over the last 3 months.

The Economic Secretary to the Treasury, Simon Kirby, explained that giving people freedom over what to do with their savings is just the right thing to do. 

Those who are choosing to access their pensions are also able to take advantage of the free and impartial government provided guidance service, Pension Wise, which has had over 3.7 million website visits and over 100,000 appointments to date.

New research conducted by Aires, a relocation services provider based out of Pennsylvania, says the practice of offering relocating employees a core set of benefits in addition to optional, flexible add-ons is becoming more of the norm. 

According to the data, about 25% of Aires’ clients use this kind of flexible approach in order to create personalized packages for talent.  This practice has been increasing in popularity pretty steadily over the course of the last few years.

Core benefits include reimbursement for things like travel, household goods, automobile and storage options and different kinds of cash allowances.  Flex benefits, on the other hand, include things like reimbursement for home-seeking expenses, temporary housing, home sale and purchase assistance and spousal assistance.

Companies that utilize this kind of core-flex procedures typically set model parameters around the flex benefits, often times allowing the employee to dictate different pieces that will be included in their model.

One human resource expert suggests these packages are increasing in popularity because they become customizable to each situation. Giving employees the ability to dictate what goes into their package based on what is most important to them, according to HR experts, increases engagement and satisfaction.

On January 20, the International Association of Machinists and Aerospace Workers (IAM), the largest union representing workers in this industry, announced it will petition the National Labor Relations Board (NLRB) to conduct a union election.

Unfortunately for Boeing this is the second time in two years this union has expressed its desire to organize employees in North Charleston where 787 Dreamliners are currently assembled.  The IAM first filed a petition with the NLRB two years ago but withdrew it before the scheduled vote.

In the press release announcing the NLRB filing, the union cited “numerous workplace concerns that remain unaddressed, including subjective raises, inconsistent scheduling policies and a lack of respect on the shop floor,” as leading to the arranging of this campaign.

IAM’s lead organizer at the Boeing South Carolina plant, Mike Evans, said employees aren’t asking for anything out of the ordinary.  They just want to be treated with respect and with the same set of standards that are present in other Boeing plants.

Boeing released a statement saying it “firmly believes that a union is not in the best interest of Boeing South Carolina teammates and their families.”  If the NLRB allows a vote to take place, employees will ultimately decide whether or not they’ll turn over their rights to the IAM or maintain their direct relationship with the company they work for.  Obviously, Boeing wants to avoid a vote at all costs especially if there are murmurs of a strike.

The political situation in the United States isn’t helping the situation either as there are many uncertainties surrounding NLRB members

As per the U.S. Equal Employment Opportunity Commission, new regulations will take effect on January 3, 2018 to clarify federal agencies’ affirmative action role and obligations as employers under the Rehabilitation Act of 1973 (Section 501).

The new regulations, which will not affect private businesses and state/local governments, move to consolidate affirmative action requirements including procedures for providing reasonable accommodations.  In addition to current action items, there will be two additional items included in the regulations.

Federal agencies must take specific steps to gradually increase the number of employees they hire who have a disability as defined under Section 501, as well as to increase the number of employees who have what the government defines as a "targeted" disability—including autism, blindness, deafness, mental illness, paralysis and convulsive disorders. Targeted disabilities are thought to pose the greatest barriers to employment.

These regulations say, in layman’s terms, that agencies should aim for employees with disabilities to make up over 10 percent of their workforce.  Employees who have a targeted disability should make up another two percent of each agency’s workforce.  These should also apply to workers at all ends of the pay spectrum, high and low.

One human resource expert explained that in the United States there are about 1.2 million people with a targeted disability who are unemployed and actively seeking work.  These new regulations are working for more equality in the workplace when it comes to those with disabilities. These new rules provide some sort of accountability. 

By the end of December 2016, the aggregate deficit of the almost 6,000 schemes included in the Pension Protection Fund (PPF) 7800 Index had risen to £223.9bn. 

In November 2016, there was a deficit of only £194.7bn.  Andy Tunningley, head of UK strategic clients at BlackRock, recently weighed in on the latest figures saying for UK pension schemes, “2016 was like a marathon on a treadmill.”  He went on to explain how the aggregate funding ratio went up and down all year long, ultimately to end very close to where it started. The only schemes that avoided playing this up and down game were those that implemented LDI, according to human resource experts.

HR experts say that as pension funds age, the cost of making any kind of wrong decision gets greater and greater.  Strong risk management is extremely important now, especially when you consider the volatility of the UK economy.  Buyer beware, however, it is important to note that risk management alone is simply not enough. 

As per the U.S. Court of Appeals for the Fifth Circuit Court, Fair Labor Standards Act violators can now be hit with emotional distress damage payouts as well.

The ruling came as the result of a case involving Santiago Pineda, a maintenance worker and his employer/landlord JTCH Apartments.  As part of Pineda’s compensation, he was given a discounted rent.  When Pineda filed a wage-and-hour lawsuit against the apartment complex to recover overtime pay for work he said he performed, JTCH reacted by evicting Pineda and his wife. 

In the notice Pineda and his wife received, the reason for eviction was cited as a failure to pay rent in an amount equal to the discount he received.  On top of the original lawsuit, Pineda tacked on a claim of emotional distress due to the fact that he could lose his home.  At this point, the court needed to determine whether or not FLSA allows for the recovery of emotional distress damages.

The court ultimately said that the FLSA’s damage provision allows for “such legal or equitable relief as may be appropriate,” and is expansive enough to include emotional distress damages.  The court remanded the case to a jury to determine the amount of emotional distress Pineda would be entitled to.  The jury ruled that JTCH owes Pineda $6,600 for overtime and retaliation, in addition to $76,000 in attorney fees.  However, this does not include emotional distress payouts, since this number has not been decided on yet.

According to HR experts, employers need to be making sure they’re following laws now more than ever because any employee who feels they’ve been wronged can collect on multiple claims, including emotional distress.  

The California Supreme Court ruled employers in California cannot require workers to remain on duty or “on call” during their rest breaks.

In a statement made by the state high court on December 22 it was determined that “during required rest periods, employers must relieve their employees of all duties and relinquish any control over how employees spend their break time.”

In Augustus v ABM Security Services, Inc., the state high court was asked to rule on whether or not a security company violated California law because it required guards to carry radios and remain on call during rest periods.  The guards argued that since they were on call and could be contacted at any point on their break, they weren’t actually on a break.  A trial court found in favor of the guards, granting them $90 million in damages, interest and penalties.  The California Court of Appeal vacated the judgement but the California Supreme Court reversed the court of appeal, agreeing with the trial court.

Additionally, employers also shouldn’t suggest or require that employees carry company cell phones, pagers or any other kind of communication device during their rest breaks.  This doesn’t mean employees cannot, just that they should not be required to.    

Typically, a nonexempt employee in California is entitled to a paid, 10-minute rest break for every four hours that are worked.  Violating the Supreme’s Court ruling could cost a company big time.  If a company violates this law, the employee must be given an additional hour of pay for each workday their full rest breaks are not provided.

HR experts suggest that to avoid any kind of confusion, employers should encourage workers to take any kind of break away from their workstations, that way there is no chance of the employer inadvertently breaking the law.

State-level changes spelling out salary threshold increases for administrative and executive exemptions from overtime pay have been updated for New York employers. 

Although the federal overtime rule remains undecided, the final rule on increases took effect on December 31 and was published just a few days earlier by New York State Department of Labor (NYSDOL). 

For the most part, increases are different in each geographic location, with changes in New York City based on the size of the employer.

HR experts expect that most companies already had a plan in place to deal with the changes since a proposed federal rule would have raised the exempt salary threshold much higher under the Fair Labor Standards Act. 

The current statewide exempt salary threshold in New York is approximately $675 per week.  The increases by geographic area and employer size are as follows: 

New York City (employers with 11 or more employees)  
$825.00 per week ($42,900 annually) Dec. 31, 2016
$975.00 per week ($50,700 annually) Dec. 31, 2017
$1,125.00 per week ($58,500 annually) Dec. 31, 2018

New York City (employers with 10 or fewer employees)  
$787.50 per week ($40,950 annually) Dec. 31, 2016
$900.00 per week ($46,800 annually) Dec. 31, 2017
$1,012.50 per week ($52,650 annually) Dec. 31, 2018
$1,125.00 per week ($58,500 annually) Dec. 31, 2019

Nassau, Suffolk and Westchester counties  
$750.00 per week ($39,000 annually) Dec. 31, 2016
$825.00 per week ($42,900 annually) Dec. 31, 2017
$900.00 per week ($46,800 annually) Dec. 31, 2018
$975.00 per week ($50,700 annually) Dec. 31, 2019
$1,050.00 per week ($54,600 annually) Dec. 31, 2020
$1,125.00 per week ($58,500 annually) Dec. 31, 2021

Outside of New York City, Nassau, Suffolk and Westchester counties  
$727.50 per week ($37,830 annually) Dec. 31, 2016
$780.00 per week ($40,560 annually) Dec. 31, 2017
$832.00 per week ($43,264 annually) Dec. 31, 2018
$885.00 per week ($46,020 annually) Dec. 31, 2019
$937.50 per week ($48,750 annually) Dec. 31, 2020

A recent study by the Academy of Management says that trying to change the minds of old workers’ managers isn’t enough when it comes to reducing the growing trend of age bias, as baby boomers extend their time in the workforce. 

A better idea, according to the study, is to create mature-age practices to engage older employees, counter their fears of bias and suppress bias tendencies occurring around them.  HR experts explain that policies created specifically to recognize and encourage mature-age workers sends a consistent and constant signal that tends to lessen their concerns about age bias. 

The study sampled 666 employers, ages 45 and up and proved that mature-age practices are scarce in most organizations.  One human resource expert explained that older workers don’t necessarily want anything that is too different from what younger workers want. 

At the end of the day, all employees should be getting performance-related feedback relevant to their career stage regardless of their age.  Companies not only need to be thinking about individual practices for older workers, but they also need to be thinking about nurturing a work atmosphere with a culture that encourages workers of all ages without bias.

A recent decision from a federal district court in Wisconsin is a great reminder of how important it is to follow legal compliance laws in compensation. 

Lenore O’Brien, a female employee began working for Unity Health Plans Insurance Corp. in May 2009 as a large-group account executive, for a salary of just over $67,000.  At around the same time, Unity also hired a male employee, Ryan Pelz, under the same job title as O’Brien but with a starting salary of $75,000.  Over the course of time, both O’Brien and Pelz received merit increases in base salary but because of the starting salary difference, O’Brien’s salary never matched Pelz’s.  In October 2014, O’Brien resigned from her position and sued the company for unequal pay under the Federal Equal Pay Act.

The court immediately denied a motion for summary judgement filed by Unity and noted that an Equal Pay Act plaintiff only needs to prove a few things: different wages paid to employees of the opposite sex, these employees performed equal work with equal skill and effort and the employees had similar working conditions.

Unity didn’t want to go down without a fight, of course.  The company argued that O’Brien was paid less because she had less experience than Pelz in selling group health insurance.  The court reviewed the terms of the job description for O’Brien and Pelz at the time of hiring and said the job description wasn’t detailed enough for Unity to make that kind of claim.  The court actually found that O’Brien and Pelz both matched the primary qualifications that had been spelled out in the description and ultimately favored O’Brien.

HR experts urge companies to use this case as an example of what to avoid.  Consistency and accuracy in HR-related records is imperative to avoiding, or at least limiting, legal liability.