April 23, 2010

I. State Laws

A. Iowa Worker Adjustment and Retraining Notification Act (Iowa WARN Act)

The Iowa WARN Act, signed by Governor Culver March 22, 2010, significantly expands the circumstances under which employers must provide WARN notices to employees. Since 1989, there has been a federal Worker Adjustment and Retraining Notification (WARN) Act, which, generally speaking, requires employers with 100 or more workers to give workers a written notice 60 days before the date of a plant closing or mass layoff. A plant closing is a shutdown that will result in an employment loss for 50 or more employees during any 30-day period. A mass layoff is a layoff that will result in an employment loss at the employment site during any 30-day period for 500 or more employees, or for 50-499 employees if they make up at least 33% of the employer’s active workforce

The Iowa WARN Act, which becomes effective July 1, 2010, applies to any person who employs 25 or more employees, excluding part-time employees (those who are employed for an average of fewer than 20 hours per week, and those employees who have been employed for fewer than 6 of the 12 months preceding the date of the required notice). Under the Iowa WARN Act, employers must give written notice to employees within 30 days of a business closing or mass layoff. The Iowa WARN Act defines “business closing” as a permanent or temporary shutdown that will result in an employment loss for 25 or more employees (other than part-time employees). The Act defines “mass layoff” as a layoff that results in an employment loss for 25 or more employees (other than part-time employees).

A covered employer who violates the notice requirements is subject to a civil penalty of not more than $100 for each day of the violation, which is the exclusive remedy for any violation of the Iowa WARN Act. Additionally, both the Iowa House and the Iowa Senate passed HF 2522, which was signed by Governor Culver on April 28, 2010.  This bill provides that the 30-day notice requirement may be reduced by the number of days for which severance payments or wages in lieu of notice are paid by the employer to the employee for work days occurring during the notice period. A severance payment or wages in lieu of notice must be at least an amount equivalent to the regular pay the employee would earn for the work days occurring during the notice period. 

B. Veterans Day for Veterans

HF 2197 was also passed by the Iowa House and Iowa Senate and signed by Governor Culver on April 27, 2010. In most circumstances, it requires employers to provide each employee who is a veteran the day off on Veterans Day, November 11. The time off may be unpaid, and the employee must provide at least a month’s advance notice of his or her intent to take Veterans Day off from work.

C. Unemployment for Military Spouses

HF 2110 was signed by Governor Culver on March 16, 2010 and is effective July 1, 2010. This bill provides that an individual is not disqualified from unemployment benefits if the individual's leaving was caused by the relocation of the individual's spouse by the military.  However, the employer's account is not charged for such benefits.


II. Federal Laws

A. Continuing Extension Act of 2010


The American Recovery and Reinvestment Act of 2009 (ARRA), as amended by the Continuing Extension Act of 2010, provides for premium reductions for health benefits under COBRA. “Assistance Eligible Individuals” pay only 35 percent of their COBRA premiums; the remaining 65 percent is reimbursed to the coverage provider through a tax credit. The premium reduction applies to periods of health coverage that began on or after February 17, 2009 and lasts for up to 15 months.

An “assistance eligible individual” is the employee or a member of his/her family who elects COBRA coverage timely following a qualifying event related to an involuntary termination of employment that occurs at any point from:

  • September 1, 2008 through May 31, 2010; or
  •  March 2, 2010 through May 31, 2010 if:
    • the involuntary termination follows a qualifying event that was a reduction of hours; and
    • the reduction of hours occurred at any time from September 1, 2008 through May 31, 2010 (a reduction of hours is a qualifying event when the employee and his/her family lose coverage because the employee, though still employed, is no longer working enough hours to satisfy the group health plan’s eligibility requirements).

Before the Continuing Extension Act of 2010, the cutoff was March 31, 2010. The new law provides retroactive eligibility for individuals who lost their jobs through May 31, 2010.

2. Unemployment

The Continuing Extension Act of 2010 extends until June 2, 2010 the filing deadline for emergency unemployment compensation for people exhausting their regular unemployment benefits. In addition to their regular 26 weeks of unemployment, unemployed individuals may be eligible for up to 33 additional weeks of emergency unemployment compensation.

B. “Health Care Reform Law”—the Patient Protection and Affordable Care Act of 2010 and Health Care and Education Reconciliation Act of 2010

Together, the Patient Protection and Affordable Care Act of 2010 and the Health Care and Education Reconciliation Act of 2010 are approximately 1,000 pages long. The insurance reforms made by these bills are too extensive to discuss in any detail here, and you should consult the Ahlers counsel with whom you normally work for specific guidance applicable to your circumstances.

However, we do wish to draw your attention to one particular provision of the Health Care Reform Law that impacts all employers subject to the Fair Labor Standards Act (which is almost all employers; the FLSA does not have a minimum number of employees like most employment laws): breaks for breastfeeding mothers.

Under the Act, employers must provide:

1. a reasonable break time for an employee to express breastmilk for a nursing child up to one year old; and

2. a place for the employee to express breastmilk, other than a bathroom, that is shielded from view and free from intrusions from coworkers and the public.

These “pumping breaks” do not have to be paid. However, if employers do not pay employees for pumping breaks, they should ensure that nonexempt employees do not perform any work for the employer (e.g., making phone calls, answering emails, reading documents, etc.) during these breaks, or the employer could be subjected to an off-the-clock claim under the FLSA.

This amendment is effective immediately.  Employees with fewer than 50 employees do not have to comply if it would cause an "undue hardship," as described in the Act.

If you have any questions about the legislation passed in 2010 and its applicability to employers, do not hesitate to contact a member of Ahlers & Cooney’s Employment & Labor Law Practice Area for assistance.


About Ahlers & Cooney's Client Alerts

Our Client Alerts are intended to provide occasional general comments on new developments in Federal and State law and regulations which we believe might be of interest to our clients. The Client Alerts should not be considered opinions of Ahlers & Cooney, P.C., and are not intended to provide legal advice as a substitute for seeking professional counsel. Readers should not under any circumstance act upon the information in this publication without seeking specific professional counsel. Ahlers & Cooney will be pleased to provide additional details regarding any article upon request. Additional copies of this Client Alert may be obtained by contacting any attorney in the Firm or by visiting the Firm's website at www.ahlerslaw.com.
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