Change has arrived early for employers.  More is in the offing, so it's wise for employers to stay close to their advisors as legislation from the newly elected majority flows from Washington.

COBRA takes a bigger bite

If your company is subject to COBRA, you already know that your employees can elect to continue their health care coverage for a period of time after they leave your employment.  Until now, the cost of that coverage has been borne by the employee.  However, now if an employee is eligible for COBRA and is involuntarily terminated between September 1, 2008 and December 31, 2009, the employer will pay 65% of the COBRA premium for up to 9 months, the former employee will be responsible for the remaining 35%.

Employers or their health plans administering COBRA benefits will be reimbursed by an offsetting tax credit against their income tax withholding or payroll taxes.  By offering this credit, the government can claim to be subsidizing the 65%, but initially the premium will come from your company's bottom line.  If you are "fortunate" enough to have a tax liability, you can claim the credit for later reimbursement.  If your operation is struggling, you need to seek advice quickly.

Old ideas never die, they just wait for the right circumstance

Such is the case for the Employee Free Choice Act (EFCA).  This pleasant sounding piece of law changes the procedures for recognizing a union.  The short version is that the process becomes significantly easier and can eliminate the secret ballot from the certification process altogether.  Critics of what's come to be called "Card Check", point to the possibility of intimidation and coercion being brought to bear on employees who would no longer enjoy the protection of a secret ballot.

Currently there are two methods for recognizing a union in the U.S.  First, employees petition for representation.  If at least 30% sign petition cards, the cards are submitted to the National Labor Relations Board (NLRB) for a secret ballot election.  Alternatively, if more than 50% certify their desire for representation, the union can form using "card check" procedures.  Currently, the employer isn't obligated to recognize the card check petition and can require a secret ballot election overseen by the NLRB.

The Employee Free Choice Act first appeared in Congress in 2005 and again in 2007.  In short, the NLRB would recognize the union if a majority of employees authorize it via card check, without requiring a secret ballot election.  While employees could choose a secret ballot, the employer would now be required to accept whichever method the employees choose.

This year we are likely to see the return and passage of the EFCA.  Many observers believe that it will result in many more union shops in the private sector.

These are just two examples of the new attitude of the federal government towards employers.  As you look to the future, will you be able to afford to build your organization the "old fashioned way"?  Will you be willing to accept the risks of employment situations gone bad?

Using agencies for hiring via temporary assignments or temp-to-hire placements is a proven way to minimize costly and unpleasant surprises.  While there are no guarantees with human beings, the fees paid to agencies for insulating your organization from debilitating change is very low compared to these kinds of obvious risks.

In this climate, it's a buyer's market for talent, and we are well stocked with an inventory of excellent people ready to help you grow into the future.  Why buy before you try?  Give us a call today!