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The Legislative Report blog provides timely information on federal and state legislation and regulations and state trends as well as the myriad issues affecting the private club industry. A companion to CMAA's Legislative website, this resource should be your first stop for any information regarding legal, tax or legislative club-specific issues.

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NLRB Issues Final Ambush Election Rule

(Dept of Labor, Regulation) Permanent link

 12_17_14

On December 12, the National Labor Relations Board (NLRB) published its final ambush election rule which was first proposed in 2011. In February, the NLRB reissued the rule for public comment. The rule is slated to become effective April 14, 2015.

Here is an overview of the changes, as provided by the NLRB. The final rule:

  • Provides for electronic filing and transmission of election petitions and other documents;
  • Ensures that employees, employers and unions receive timely information they need to understand and participate in the representation case process;
  • Eliminates or reduces unnecessary litigation, duplication and delay;
  • Adopts best practices and uniform procedures across regions;
  • Requires that additional contact information (personal telephone numbers and e-mail addresses) be included in voter lists, to the extent that information is available to the employer, in order to enhance a fair and free exchange of ideas by permitting other parties to the election to communicate with voters about the election using modern technology; and
  • Allows parties to consolidate all election-related appeals to the Board into a single appeals process.

The renewed rule will significantly change NLRB election procedures by decreasing the time between the filing of a petition and the occurrence of an election. It could be disadvantageous for both employers and employees by hampering an employees’ ability to obtain complete information about the costs of unionization and limiting the employer’s ability to effectively prepare for the process. An election could be scheduled in as few as 10 days. The current average is 30 days.

Stay tuned as this is an issue which will be contested in 2015!

IRS Targets Nontraditional Activities

(IRS) Permanent link

12_16_14_175In recent months, the Internal Revenue Service (IRS) has begun focusing on nontraditional income for 501 (c)(7) tax-exempt clubs in examinations and Private Letter rulings. In a PLR released on Friday, December 12, the IRS revoked the tax-exempt status of a social club who had incurred significant nontraditional income, apart from its core mission as a social club.   

Mitch Stump, CPA, and author of the Club Tax Book, shares "The issue of non-traditional income has come up recently and repeatedly on IRS examinations. Now, with this recent PLR which uses a 'Modified gross receipts per. Rev. Proc. 71-17' methodology, all 501(c)(7) tax-exempt clubs should be on notice that their non-traditional activities could cost them their tax exempt status."

So what are nontraditional activities? In short, they are any activity that does not meet the club's central purpose which should be organized "exclusively for pleasure, recreation and other nonprofitable purposes." Think to-go food and wine sales, where the consumption by the member is off-site.

Read more on this topic in McGladrey’s eClub New's article “Non-traditional activity in private clubs.

Court Strikes Down Private Wage Surveys for H-2B Visa Program

(Legal Issues, Dept of Labor, Immigration) Permanent link

12.11.14A_175On December 5, the Third Circuit of the US Court of Appeals overruled the use of private wage surveys in the determination of wages for H-2B visa workers. In its decision, the court cited the negative effects of the use of these surveys on both employers and employees.

For employers who cannot afford the cost of commissioning a private survey, they must rely on the Occupational Employment Statistics survey from the Department of Labor's Bureau of Labor Statistics. For employees, both H-2B workers and US workers, the Court argued that the surveys created "depressed" wages and earnings when compared to the wages from DOL’s statistics.

Further, Judge Morton I. Greenberg argued in his decision that the DOL had violated the Administration Procedures Act by failing to "offer any rational justification for this policy as it leads to similarly situated workers in the same market in the same season bringing home widely disparate paychecks."

Due to ongoing litigation involving the DOL and H-2B visa program wages, H-2B visa wages are being calculated based on interim 2013 rules, with most employers obtaining a prevailing wage determination from DOL. Earlier this year, the DOL announced its plans to issue a new notice of proposed rulemaking specific to H-2B wages. These proposed rules were expected this month but have yet to be announced.

Evolving Your Legislative Coverage

 Permanent link
12_11_14_175It is hard to keep up to date with all of Congress’s actions. With the hectic and frantic schedule of the club management professional in mind, CMAA is trying to make it easier to understand the actions affecting you and your club.

Two years ago, we launched the weekly and as-needed Legislative Report blog, which keeps you up to date on all of the latest legislative, regulatory and legal information you need to know.

Now we are evolving the Legislative and Regulatory Summary to an easier to consume format, the CMAA Watch List. There is no need to wade through all of the federal legislation that comes through Congress—that is our job. The CMAA Watch List will profile the most current and important legislation in a simple format with links to more information like full bill text, history, sponsor information, current status and fiscal information.

Beginning January 1, you will have access to this information as well as immediate links to action alerts through www.clubindustryvotes.org if your response is required. Simple, easy and done. 

 

Wellness Programs, the EEOC and the ADA

(Health Care Reform, Legal Issues) Permanent link

In recent months, the Equal Employment Opportunity Commission (EEOC) has filed lawsuits against two US companies for the manner in which they administered and executed employee wellness programs. According to research conducted by the Kaiser Family Foundation, the majority of employers now offer some sort of wellness program - 94 percent of employers with more than 200 workers, and 63 percent of smaller ones.

In October, the EEOC filed suit against Flambeau, Inc. The EEOC cited the company’s wellness program required that employees submit to biometric testing and a health risk assessment. Employees who did not participate would face cancellation of medical insurance, unspecified disciplinary action for failing to attend the scheduled testing and be required to pay 100 percent of the insurance premium to stay insured. Employees who completed the biometric testing and health risk assessment were only responsible for the payment of 25 percent of their premium cost.

In its argument, the EEOC contends that the biometric testing and health risk assessment constituted "disability-related inquiries and medical examinations" that were not job-related or consistent with business necessity as defined by the Americans With Disabilities Act (ADA). Specifically, the EEOC cited a violation of Title I of the ADA, which prohibits disability discrimination in employment, including making disability-related inquiries.

In August, the EEOC filed its first lawsuit on wellness programs against Orion Energy Systems. In that case, the employee’s insurance was cancelled after failure to complete the required biometric testing and shortly after the employee was fired.

In the argument, John Hendrickson, regional attorney for the EEOC Chicago district, shared:  

Employers certainly may have voluntary wellness programs -- there's no dispute about that -- and many see such programs as a positive development. But they have to actually be voluntary. They can't compel participation by imposing enormous penalties such as shifting 100 percent of the premium cost for health benefits onto the back of the employee or by just firing the employee who chooses not to participate. Having to choose between responding to medical exams and inquiries -- which are not job-related -- in a wellness program, on the one hand, or being fired, on the other hand, is no choice at all.

For clubs with current wellness programs, it is advisable to ensure that the programs that you are offering are voluntary and do not penalize employees who do not or unable to participate.  

Preparing for Health Care Compliance in 2015 and Beyond

(Health Care Reform, Legal Issues) Permanent link

January 1, 2015, brings the deadline for providing health care to all full-time-equivalents (FTE) for applicable large employers under the Employer Shared Responsibility provisions of the Affordable Care Act (ACA). That means that penalties will begin for employers who fail to provide coverage. For 2015, the penalty for employers with 100 or more FTEs is $2,000 per year per FTE, less the first 80 full-time employees. The penalty kicks in if any FTE gets a federal tax subsidy to buy a health plan through a government-run health insurance marketplace.
 
So what do you need to do?

 
Do you have 100 or more FTEs?
 
By January 1, 2015, you need to be providing health care coverage to “substantially all” of your FTEs and their dependents. There is some good news. For 2015, the definition of “substantially all” is 70 percent. In 2016, this definitely increases to 95 percent of your FTEs.
 
Do you have 50 to 99 FTEs?
 
Good news. There is transitional relief through 2015 as long as you meet all of the conditions. The most significant provisions being that you do not take actions to reduce employee hours or positions during 2015 in an effort to keep the business under 100 FTEs. Your date will be January 1, 2016, for providing coverage.

Do you have fewer than 50 FTEs?
 
Even better news. This law does not mandate coverage provisions for you. If you have 25 or fewer FTEs and provide health coverage, you may be eligible for tax credits. If you have 25-49 employees, you may be eligible to purchase coverage through the Small Business Health Options Program (SHOP). Learn more at IRS.gov.

CMAA, Golf Industry File Comments to EPA’s Waters of the US Rule

(Regulation) Permanent link

On Friday, November 14, CMAA and its Golf Industry allies submitted their official comments to the Environmental Protection Agency in regards to the proposed expansion of the Clean Water Act and Waters of the US Rule.
 
These comments focus specifically on the impact to the golf industry and were submitted by Golf Course Superintendents Association of America, Club Managers Association of America, National Club Association, American Society of Golf Course Architects, Golf Course Builders Association of America, National Golf Course Owners Association and Professional Golfers Association of America. In these comments, the golf industry expressed concern for the “the EPA and Corps’ expansion of the jurisdiction over WOTUS as written in the proposed regulation” and “recommends the Agencies withdraw the proposed rule, in light of the proposed rules numerous ambiguities and inconsistencies.”

Further, CMAA signed onto 106-page comments through the Waters Advocacy Coalition. WAC represents a large cross-section of the nation’s construction, real estate, mining, agriculture, transportation, forestry, manufacturing, and energy sectors, as well as wildlife conservation and recreation interests. All are vital to a thriving national economy, including providing much needed jobs. The proposed rule will have a significant impact and hinder Coalition members’ ability to create opportunities and jobs. The WAC-submitted comments called for immediate withdrawal of the rule.

It is currently estimated that more than 800,000 comments were submitted on this rule to the EPA through regulation.gov.