Affordable Care Act Collective Bargaining Agreements

The Cadillac tax. It is essential for employers to assess now whether they are likely to trigger excise duty based on the current cost of their performance plans and the expected rate of increase in the cost of those plans until 2018. In the absence of a substantial change to the CBA law, these excise thresholds are unlikely to increase before 2018, except through the adjustment corresponding to the increase in federal employee rates. After 2018, the dollar thresholds will be indexed as follows for inflation โ€“ for 2019: the consumer price index plus one percentage point; for 2020 and beyond, according to the Consumer Price Index. Waiting for the Cadillac tax. Without a waiver statement, employers who have contracts open or soon to open should consider reducing their plans now if necessary. Most existing workplace health plans generously exceed the minimum value standard. Some employer plans, if not reduced, may trigger excise duty given their current costs and the historical growth rate of hedging costs. Unions will likely oppose efforts to cut workers` benefits in the short term, but unions (hopefully) will understand that a failure to tackle excise duties could divert resources that might otherwise be available to be added to the economic package at the bargaining table.

Cost trigger to protect against Cadillac taxes. Even if employers are able to take measures to control the costs of the health plan during contract negotiations, employers should also try to include in their employment contracts a provision that would result in cost reductions necessary to avoid excise duties. The specifics of this provision should be discussed between the parties, for example. B the benefits that would be reduced or the procedure by which the union and the employer would agree on such changes. Such a provision would help employers avoid the worst-case excise duty scenario, i.e. an obligation to pay a non-deductible tax of 40% without it being avoidable due to the restrictions imposed by the employment contract. Contact for Lawyers For more information, please contact your Principal Registry Representative or one of the lawyers mentioned below. Electronic messages can be sent via our contact form which you will find at Patricia A. Dunn Washington +1.202.879.5425 F. Curt Kirschner Jr. San Francisco +1.415.875.5769 For example, an employer can raise its minimum wage responsibly for a contractual period, without angering nlRB, because Congress left nothing to its discretion.

However, the choice of legal compensation and performance options is a mandatory subject for negotiation4 The Board of Directors will likely apply this line of reference to decisions such as setting safe harbor measurement and “stability” periods for employees with variable hours, in accordance with IRS Communications 2012-58 and 2012-59. The board of directors should not order you to rescind the ACA`s mandatory compliance measures, but you may need to get the union`s waiver of the zipper clause โ€“ perhaps by granting something you refused in the last negotiation โ€“ to negotiate a medium-term change to your health insurance program, which is not expressly prescribed by law. Otherwise, the NLRB could order you to reinstate your previous offers, in accordance with the law, to make employees a complete operation for the difference between what they received and what they would have received, and then negotiate the union`s agreement on all the amendments.5 It would not be a defense that the new law made your previous insurance program unbearably expensive.6 The National Labor Relations Act, 29 U.S.C. ยง 151 et seq., a federal law of the 1930s, prohibits employers of unionized workers from changing their wages, working hours or working conditions without first notifying their union in a fair manner and from having the opportunity to negotiate the proposed changes and their effects on the workers represented. . . .