The law firm Spilman Thomas & Battle, PLLC (Spilman) announced today that the firm has launched its new Spilman SuperVision app for iOS devices. The app, which is available for free download in the Apple App Store, is designed to help corporate executives, general counsel and human resources professionals with the most frequent questions encountered by the firm’s labor and employment attorneys.
“We are excited to share the latest information on human resources issues and regulations via this new channel,” said Eric W. Iskra, chair of Spilman’s Labor and Employment Practice Group. “This app is a perfect complement to our SuperVision labor and employment symposium series and our quarterly e-newsletter. Finding new ways to deliver additional value to our clients is always front-of-mind at Spilman.”
The app allows users to explore common employment law situations, including those relating to overtime pay, final wage payment and employee complaints on social media. Following the app’s simple decision tree, users can gain a better understanding of their particular employment issue, what their options are, and when to seek the counsel of a knowledgeable legal advisor. Spilman worked with Pittsburgh design firm Quest Fore for the app coding and programming.
Spilman’s Labor and Employment Practice Group has been ranked at the national level through the Best Law Firms survey, a combined effort of U.S. News & World Report and Best Lawyers®, for excellent representation of management in employment disputes. The group has also been recognized by ALM as a Go-To Law Firm® for labor law litigation.
Many employers give their employees the option to receive cash if they opt out of the employer’s health insurance coverage. It is permissible to do so, but the option must comply with IRS rules.
Cash in lieu of benefits falls under the cafeteria plan rules of Section 125 of the IRC. The employer must have a written cafeteria plan in place and the plan must have cash in lieu of the benefit coverage as one of its options. An employer cannot have cash in lieu of policy which is outside a cafeteria plan.
If the employer does not have a written cafeteria plan in place or if the employer’s cafeteria plan does not include the pay in lieu of coverage as one of its options, but the employer offers pay in lieu of coverage outside the plan, the IRS takes the position that all employees have the option to take cash or the benefit and that the employees who chose the benefit coverage and forego the cash will nevertheless be deemed to have received taxable wage income equal to the amount of the cash alternative. See, Prop. Treas. Reg. § 1.125-1, Q & A – 9; Private Letter Ruling 9406002.
In addition, the amount considered to be wages is subject to income tax withholding and FICA and FUTA payroll taxes. Further, the amount considered to be wages should be included in the employee’s “regular rate” for purposes of computation of overtime pay unless the criteria set out in the DOL Opinion Letter FLSA 2003-4 (June 2, 2003) are satisfied. Among the criteria are that the employee must show there is alternative coverage for the coverage being waived and no more than 20% of the employer’s contribution to the cafeteria plan can be paid out in cash. See, Madison v. Resources for Human Development, Inc. 39 F.Supp.2d 542 (E.D. Pa. 1999), vacated and remanded, 233 F.3d 175 (3d Cir. 2000); Prop. Regs at 72 Fed. Reg. 43939 (August 6, 2007).
Posted by Carl H. Hellerstedt, Jr. Mr. Hellerstedt is Counsel with Spilman Thomas & Battle, PLLC. His primary areas of practice are labor and employment and ERISA law.