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January 2019 HR Regulatory Updates

Jill Schaefer /
Text: "Regulatory Update"

This blog post covers timely federal and state legislative employment updates. Check out what you need to know and gain compliance tips to help you stay on top of HR, the right way. Click on the federal topics or state names below to catch up on the latest news.


STATE Updates


Removal of ACA Uninsured Penalty for 2019

Who: Uninsured Individuals

When: 2019 Tax Filing Season (Next Year)

Previously, the Affordable Care Act (ACA) required individuals to pay a penalty as part of their previous year’s taxes if they didn’t have health insurance. In the 2017 tax filing season, the average penalty amounted to $667, but most Americans weren’t affected by the penalty. For the 2018 tax filing season, the penalty is still in play. However, it’s unknown if the Trump Administration will enforce it.

In 2019, the federal uninsured penalty will be $0. However, Massachusetts, New Jersey, Washington state, Vermont, and Washington D.C. will keep individual penalties in place.


  • Under the ACA’s employer mandate, large employers (50+ full-time employees) still need to offer affordable, minimum value coverage or they will continue to face a tax penalty.
  • Employees are not required to accept their employer’s health coverage plans.
  • Employers with 200+ employees must automatically enroll employees into a health plan if they don’t make a selection, but employees can opt out.

Additional Resources:

IRS Update on Student Loan Debt/Employer Matches

Who: Employers Who Offer Student Loan Repayment/Forgiveness

When: To be determined

On average, college graduates now have $40,000 in student loan debt. In addition, Pew reports that only 31% of Millennials participate in employer-sponsored retirement plans. Based on these numbers, a small percentage of employers are now offering student loan assistance as a recruiting and retention strategy.

The U.S. Internal Revenue Service (IRS) issued a private letter ruling (PLR) indicating employers may have some new options with their student loan programs. For employees who participate in employers’ student loan repayment program, but not the company’s 401(k) plan, employers may be able to use the matching student loan payment as a 401(k) contribution.


  • Don’t base a new student loan assistance strategy off of the IRS’s PLR. These tend to be specific to the employer writing in and may not apply to your scenario.
  • If the IRS is going to fully support this option to fund a 401(k) plan, it will likely issue more formal guidance.
  • In the meantime, you may want to evaluate if student loan assistance is desirable for your organization.

What Government Shutdown Means for HR

Who: Employers

When: December 22, 2018-?

Congress was unable to approve a 2019 budget last month and President Trump refused to sign a short-term spending bill, which resulted in the partial shutdown of 9 federal government departments. Affected departments include the Department of Justice, Department of Homeland Security, and the Equal Employment Opportunity Commission. However, this doesn’t mean anything goes for employers.


  • Even though the E-verify system, used to verify employees are authorized to work in the U.S., is not up right now, you should still collect I-9 forms within 3 days of an employee starting their job.
  • Individuals may still use the EEOC website to file discrimination claims and meet statutes of limitations.
  • Expect a backlog with mediations and processing.


2019 State and Local Minimum Wage Updates

Who: Employers

When: January 1, 2019


Several states and cities have increased minimum wages in 2019. See the complete list.


New Paid Leave Guidance

Who: Employers

When: January 1, 2019

Massachusetts legislated a phased paid family and medical leave law. By 2021, most employees will be able to take up to 12 weeks of paid leave to care for a family member or to welcome a new child. This law also gives employees up to 20 weeks of paid leave to address their own serious medical issue. To create a way to fund the leave, employers will start collecting a payroll deduction from employees in 2019.

The newly formed Massachusetts Department of Family and Medical Leave launched a webpage and issued guidance and FAQs to help employers better understand the law and how to comply with it.


    • Employers are to post/provide a notice starting on July 1, 2019.
    • Within 30 days of being hired, new employees need a written explanation of their rights.
    • Starting July 1, 2019, employers will need to begin collecting an initial 0.63% payroll tax from employee paychecks.

Additional Resources:

New York

New York’s Paid Family Leave Adds Organ Donation

Who: Employers

When: February 3, 2019

The Living Donor Protection Act (SB 2496B) expands New York’s paid family leave and Workers’ Compensation Law to include “transplantation preparation and recovery related to organ or tissue donation” as a serious health condition. While New York’s paid family leave doesn’t cover an employee’s own serious health condition, it allows eligible employees to take paid time off to care for a family member with a serious health condition. Under the amendment, if a family member chooses to be an organ or tissue donor, employees may take time off for that family member’s transplant preparation and recovery from surgery.

SB 2496B also amends the New York State Insurance Law. Insurers can’t discriminate against people who are living organ or tissue donors. This applies to not denying coverage for life, accident, and health insurance policies on the basis of living organ donor status.


  • Update your employee handbook to include organ donation as part of your policies around New York’s Paid Family Leave.
  • Train your HR team, supervisors, and managers on the law’s requirements and employees’ rights to use paid family leave.


District Court Rules ACA Unconstitutional and is Appealed

Who: Employers

When: To be determined

Last month in Texas v. United States, a U.S. District Court judge for the Northern District of Texas ruled that the federal Affordable Care Act (ACA) was unconstitutional. Judge Reed O’Connor based his ruling on the 2017 federal Tax Cuts and Jobs Act, which eliminated the individual uninsured penalty. Hypothetically, this state ruling would have overturned all of the ACA. However, this amounted to a declaratory judgment and didn’t result in any binding actions for employers. The ruling has already been appealed. This case will also likely make its way to the U.S. Supreme Court, but there will be no change to the ACA for the foreseeable future.


  • There is no action for employers right now. Continue following your established ACA compliance processes and deadlines.
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