Compensation Solutions Blog
Human Resources Outsourcing (HRO – PEO – ASO – Payroll – Agency)

BofA Merrill Lynch Global Research – A US Economics Report – Friday, 26 April 2013

Underlying growth slows in Q1

The GDP report was disappointing with headline growth of only 2.5% in Q1 (consensus: 3.0%) following meager 0.4% growth in Q4. Much of this swing owed to inventories which added 1.0pp to growth in Q1 after slicing 1.5pp in Q4. Final sales, which are a measure of underlying demand, slowed to 1.5% from 1.9%, indicating weakening momentum to start off the year. We remain comfortable with our below-consensus forecast for growth of 1.3% in Q2.

Read the full report here.

Best Practices Advice for Company-Sponsored Events

This time of year, employees will be invited to various Company sponsored or promoted events such as summer picnics, sports outings and charitable events, i.e., Habitat For Humanity, Hurricane Sandy Response and Recovery, etc.  There are many great purposes for these events, such as for the enjoyment of employees, vendors, clients and their families, assisting the community and/or those in need.   While these types of events can help boost morale and increase relationships, the employer could be liable for any accidents or injuries resulting from these events.

There are ways to minimize a Company’s risk while also being a good community Partner and they are:

• Explain, in writing, that all of the above type of events do not require attendance or participation by the employee and that they are totally voluntary.
• If an employee chooses not to attend or participate in the event then such decision shall not have any effect, positive or negative, on the terms and conditions of the employee’s employment with the company.
• It is beneficial to have an employee sign a release acknowledging they are aware these events are voluntary, not a requirement of their job and no work should be performed at the event.
• In cases where alcohol is available or served, employees should be reminded to be cautious and to control their consumption and the consumption by their guests.

Lastly, some of the events may entail physical exertion or be in extreme weather and it is always advisable to remind employees that they may want to consult with a physician before participating in the event.

Social activities are a great morale booster to all involved but do require a little preventive action on your part.  If you would like a sample best practices’ notice and release for participants to sign then please contact the Human Resources’ Department.

CSI is providing the above blog in furtherance of its mission to provide its Clients and Friends with the best practice for their human resource (HR) needs. CSI does not provide legal, insurance, tax or financial advice of any kind. No portion of this blog or any prior correspondence, written or verbal, is intended to provide legal, tax or financial advice. You are advised to consult with competent counsel on all legal, insurance, tax or financial issues.

Healthcare Reform – Full-time Employee under the Employer Shared Responsibility Provision

Beginning January 2014, employers that generally employ 50 or more full-time employee equivalents will be subject to the Affordable Care Act provision known as the Employer Shared Responsibility.  If an employer does not employ, on average, more than 50 full-time employee equivalents, then the employer is not subject to the Employer Shared Responsibility provision.  Employers can determine whether they meet the 50 full-time employee equivalent threshold for January 1, 2014 by using applicable information from 2013.  As a reminder, employers must also consider related/control group entities when determining the 50 full-time employee equivalent threshold.

For this article, we will focus on who is considered a full-time employee under the Employer Shared Responsibility provision.  Currently, defined as an employee working, on average, 30 hours per week or 130 hours per month.

In addition to the above criteria, when calculating those that are full-time, the employer also needs to consider part-time employees.  The employer must convert part–time employees into an equivalent number of full-time employees.  To do this, an employer can take the total number of hours worked by all part-time employees in one month and divide it by 120 and this will provide the employer with the total number of full-time equivalent employees.  Thereafter, add all the full-time employees with the full-time equivalents to get to the total number.

Example:  Company has 20 part-time workers that worked 20 hours per week each for the month which equals 1600 hours in total.  Divide the 1600 hours by 120 and the result is 13.3 full-time equivalents.  If the company has 20 regular full-time employees plus the 13.3 full-time equivalents, then that employer is below the 50 full-time equivalents threshold and not subject to the Shared Responsibility Provision.  However, same scenario but the company has 40 regular full-time employees plus the 13.3 full-time equivalents, then they are over the 50 full-time equivalents threshold and subject to the Shared Responsibility provision.

There is an exception for seasonal workers, those who work less than 120 days during the year.  If the employer’s workforce is greater than the 50 full-time equivalent threshold for 120 days or less during the calendar year and if the employees greater than the 50 who were employed for not more than 120 days are seasonal workers, the employer would not be subject to the Shared Responsibility threshold.

Next week we will cover more on Healthcare Reform.  STAY TUNED!

Vision problems – do more than have your eyes tested

It is a misconception that you should only get your eyes checked if you are struggling with your vision. There are a number of benefits that can result from getting your eyes examined on a regular basis.  As such, failing to have an eye exam annually can be detrimental to your overall health.

Not only can an eye exam provide insight into the health of your eyes but there are many other physical problems which can be detected.  Result, get your eyes checked at least once per year for the following benefits:

• When you get a routine eye exam, your vision will be assessed and recommendations can be made to enhance your eyesight.
• Eye diseases like glaucoma can be caught early enough so treatment can begin before vision is severely compromised or blindness occurs.
• Other diseases like diabetes and high blood pressure can be detected with a routine eye exam.

By visiting the eye doctor for a routine eye exam at least once a year, you can ensure that you not only optimize your vision; but also improve your life with better health.

BofA Merrill Lynch Global Research – A US Economics Report – Tuesday, 16 April 2013

CPI inflation declines to 1.5%

CPI inflation surprised to the downside at -0.2% monthly in March (versus flat for consensus and -0.1% BofAML), as energy prices continued to fall. This pulled the year-on-year inflation rate down to 1.5% from 2.0% in February. Core CPI also came in soft, as we warned it might: prices excluding food and energy rose just 0.1% (versus 0.2% expected from both consensus and BofAML). In conjunction with even softer PCE inflation data, we expect the Fed to acknowledge that it is currently missing on its price stability as well as employment mandate, thereby warranting a continuation of asset purchases well into next year.

Read the full report here.

How to save money on prescriptions

Know your Prescription coverage!  First, if you are covered by health insurance then ask for a copy of your insurance carrier’s drug list.  You can obtain a copy of the list so when your physician prescribes a drug then you are able to review the list with your physician.

Second, Learn about the myriad of “discount drug programs” that are currently in the marketplace specifically the CSI PCA card.   Simply go to http://www.pcasavingscards.com/ and using the dropdown, select “Compensation Solutions” to start saving.

You can also access savings through national retailers such as Wal*Mart, Shop-Rite, Costco, Target and many others.  Many retailers have “copays” which are lower than the lowest tier available through your insurance plan.

Third, clip coupons – research for coupons offered by the manufacturer for drugs that you are taking on a regular basis.  Fourth, ask for samples.  When your doctor recommends that you take a certain drug then ask for samples.

Lastly, shop around and become an educated consumer.

BofA Merrill Lynch Global Research A US Economics Report – Friday, 05 April 2013

Disappointing jobs report

The economy only added 88,000 jobs in March, significantly below consensus expectations of 190,000. The unemployment rate fell to 7.6%, not because of stronger job growth, but because of fewer people searching for work. We believe this report likely kicks off a series of weaker data to come. We expect job growth to remain below 100K for the next two months as the sequester kicks in. This is consistent with our forecast for GDP growth to slow from above 3.0% in Q1 to 1.3% in Q2 and for the Fed to keep policy extremely accommodative.

Read the full report here.

BofA Merrill Lynch Global Research A Research Investment Committee Report – Tuesday, 09 April 2013

Is it too late to jump in? It may be riskier to stay out

The S&P 500 and Dow indexes recently bumped up against their all time highs. By many key metrics, the market is undervalued compared to the last two times the S&P index was at current levels. And the alternatives are much less attractive.

Read the full report here.

BofA Merrill Lynch Global Research A US Economics Report – Wednesday, 10 April 2013

Better data before FOMC meeting boosted taper talk

The Fed surprised with an early release of the March FOMC minutes today, but the discussion was less unexpected: while some participants favored winding down QE purchases relatively soon, the majority of the members see the benefits as outweighing the costs and want to see better data to support tapering QE3. In that regard, the upcoming fiscal headwinds, continued concerns about Europe, and recent slowdown in US data all mitigate against a quick end to QE. We do not expect the Fed to slow the pace of its purchases until the middle of the first half of next year, with buying finally concluding later in 2014 given our forecast.

Read the full report here.

Federal SHOP Exchanges Delayed until 2015?

A major provision in the Patient Protection and Affordable Care Act, a/k/a Federal Healthcare Reform Law (the “Law”), was the establishment of what will be known as the Small Business Health Options Program (the “SHOP”).  The SHOPS, which were intended to be operational in all states by 2014, will operate individually in each state with the intention of providing healthcare choices which are affordable to small businesses.  As we previously covered, some states have chosen to establish their own marketplaces of healthcare (“Exchanges”) while other states will rely on the Federal government to solely establish their Exchanges and yet the balance of the states will operate their Exchange in cooperation with the Federal Government.

Now recently, the Health and Human Services Department (HHS) has proposed delaying the option of offering a variety of healthcare plans in the federal SHOP Exchanges until 2015.   We will keep you up-to-date as it pertains to the SHOPs as the developments unfold.

Next week we will cover more on Healthcare Reform.  STAY TUNED!