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iGroup Coverage Continuation Subsidy

Individuals who lose group health coverage because of an involuntary termination ("former employees") between September 1, 2008 and December 31, 2009 are eligible for a 65% federal subsidy of their COBRA or state continuation coverage premiums for up to 9 months...read all the facts.

Temporary agencies to grow more muscle!!

Senate Bill 1612 amends the Day and Temporary Labor Services Act by providing that a temporary labor service agency may recover attorney’s fees and costs in a civil action by the temporary agency against a client for breach of contract for services provided by the agency (this would apply mainly in the event that the client failed to pay for the services, but the language in the bill is broad enough to include a multitude of other actions). The only kicker: the agency has to “prevail” in the civil action (lawsuit). The word “prevail” is not defined in the amendment, but there are a number of court cases which discuss the term “prevail” in contracts between the parties.

This bill has passed both the Senate and the House, but has not yet been signed into law by the Governor. The legislation becomes effective on the date that the Governor signs the bill.

This is a bill that favors the temporary agency industry; for we are uncertain if the “purchase orders” used by the client or the temp agency address the question of recovery of fees and costs in the event of a law suit.

E-Verify Rules for Federal Contractors

Are Delayed Again

Last week the federal government once again delayed new federal contractor requirements for E-Verify. The applicability date was changed from May 21, 2009, to June 30, 2009. This is the third delay. The stated purpose was to allow the Obama Administration an adequate opportunity to review the rule.

The delays have followed a lawsuit filed last year on behalf of the U.S. Chamber of Commerce that challenged the legality of the rules on the ground that current immigration law prohibits mandating the use of the E-Verify system.

Unless the courts strike down the rules, or the administration comes up with a modified version that can pass legal muster, federal contractors and subcontractors that are subject to the rules will have to review their I-9 forms dating back to 1986 for all employees assigned to a federal contract and make any required updates or changes. They will also need to ensure that other E-Verify requirements are met, including verifying that a photograph of the employee was reviewed during the initial process and that current status documents are updated to reflect the employee’s current eligibility to work in the U.S. In many cases, an entirely new I-9 will need to be completed. The rules also will apply to all new employees hired during the contract term—regardless of whether the new hires are assigned to a federal contract.

Senate Bill (SB) 1331 and companion House Bill (HB) 1081, the proposed Illinois Family and Employers Health Care Act, would establish a program to make health insurance plans and HMOs affordable and accessible to small employers and individuals. They would also create the Illinois Guaranteed Option Premium Assistance Program to provide private health insurance premium assistance.

Additionally, they would establish the Illinois Shared Responsibility and Shared Opportunity Assessment System, which would impose an employer tax, ranging from 1.5 percent to 6 percent, on the wages paid to Illinois full-time employees. Employers would be entitled to take full credits against the tax if the company’s total expenditures for health care for Illinois employees is equal to or greater than 4 percent of the wages paid to those employees. Partial credits may be available to employers who contribute less than 4 percent of wages for healthcare costs.

The tax would be applicable to wages paid on or after Jan. 1, 2010, and would be paid beginning on July 1, 2010. The House bill is in the House Rules Committee. The Senate bill is in the Assignments Committee.

The Illinois Search and Staffing Association, a powerful voice for the staffing industry, says that it is strongly opposed to both bills.