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Monday, April 22, 2019

There is so much hype going on in New Jersey. Governor Phil Murphy has signed several of new laws that went into effect late 2018 and early 2019. These new laws can have an impact on business owners both small and large, expecting mothers, parents, caregiver and employees in a variety of ways.

These laws will change health insurance mandate and small employer stop loss bill, family leave benefits, mandatory paid leave and minimum wage.

Wow! Big changes. Let’s have a conversation about this.

Health Insurance

Stop Loss Bill:

A bill was introduced in both the Senate and Assembly and if passed would prohibit insurance carriers or other insurers subject to the insurance laws of New Jersey from offering, issuing or renewing any stop loss insurance policy of any kind to small employers.

Most businesses that sign up to stop loss premium plan are sometimes unaware that they are enrolled in a stop loss plan. This is because the plan feels and acts like a fully insured plan. If the premiums are fully paid then there are no responsibilities for the employers. Business have even saved and enhanced their benefits by moving to a stop loss plan. If this bill passes, companies like Aetna (AFA), National General and Star Mark will no longer be permitted to offer health insurance. Between all three carries there are about 70,000 individuals on stop loss plans.

Cosmo can attest that so many of our business clients switched to a stop loss plan and saved extensive amount of money while lowering their copays, deductibles and max-out-of-pocket expense.

Health Insurance Mandate:

Gov. Murphy signed into law a statewide individual mandate requiring all New Jersey residents who don’t have health coverage through their jobs or through a government program to buy a policy or pay a fee.

With or without this mandate it won’t change a thing because individuals will still not purchase health insurance plans. Individuals would rather pay the mandate fee than purchase a health insurance plan because the fee is much cheaper than a health insurance policy.

Extensive Expansions on Benefits

Paid Family Leave:

Starting July 1, 2020, employees will be entitled to more time off for a birth, adoption or foster of a child or to care for a family member who is ill, and entitles them to more money during their leave.

The current law allows individuals to receive six weeks of benefits equal to 66 percent of their pay, but the new law is increasing paid time off to 12 weeks at 85 percent of their pay.

Governor Phil Murphy stated, “Paid family leave can be vital in allowing them to focus attention on where it is most needed: on their families.”

This law also allows for victims of domestic violence or sexual assault, and family members who care for them, to use New Jersey Family Leave Act.

Mandatory Paid Sick Leave:

New Jersey has now become the 10th state in the nation to enact statewide mandatory paid sick leave. Governor Phil Murphy signed into law the New Jersey Paid Sick Leave Act, which took effect October 29, 2018. This prohibits employers from discriminating against employees for requesting or using sick leave. Employers are required to pay employees for earned sick leave at their regular rate of pay.

In a benefit year an employee will accrue up to forty (40) hours of sick time at a rate of one (1) hour of paid sick leave per thirty (30) hours worked. For example, if an employee works 30 hours they now have accrued 1 hour of paid sick leave.

Employees may use earned sick days for:

The medical needs of an employee or employee’s family member(s) such as: diagnosis, care, treatment of, or recovery from the employee’s mental or physical illness, injury or other adverse health condition, or for an employee’s preventive medical care.

Closure of the workplace, school or childcare due to a public health emergency.

A child’s school-related conference, meeting, function or other event.

Employers may not require an employee to find coverage for their absence nor request documentation unless they are out more than three days.

Minimum Wage Increase:

Governor Murphy calls for $15 an hour for all! New Jersey will be the fourth state in the country to significantly raise minimum wage; currently it’s $8.85 an hour, but will boost incomes for all. The bill’s plan is to gradually raise the standard minimum wage over the years. On July 1 it will be raised to $10 an hour, then January 1, 2020, it will be raised to $11 an hour, and will increase $1 an hour every year until it reaches $15 in 2024.

The bill includes some exceptions: For seasonal workers and employees at small businesses who employ five workers or less, the base minimum wage would reach $15 an hour by 2026. For farmworkers, the base minimum wage would increase to $12.50 an hour by Jan. 1, 2024. Then, a special committee would review whether to raise those workers’ minimum wage to $15 an hour.

This is time consuming! Especially for business owners. How can they pass the responsibility to someone else?

Consulting with HR and compliance experts could be valuable to help employers maintain compliance and avoid penalties that can come from violating the law.

Having a PEO can protect you with all of this and every question or concern you may have with your business. PEOs take responsibility for all employee benefits and government changes. It’s like having a HR in-house: they are responsible for making employee handbooks, time and attendance, so they will keep track of employee paid sick leave hours—which will leave you available to take care of other business needs. PEOs are trusted business partners for small- and medium-size employers; PEOs deliver cost-effective, outsourced services for health benefit administration. PEO providers know you need Fortune 500-level benefits to win top talent in a competitive marketplace. And you want cost-effective, flexible benefits that fit into your business plans. Having a PEO can come with lots of benefits.

This is where Cosmo Insurance Agency comes into the picture! Whether it’s finding a PEO for your business or enrolling in individual/family health insurance plans, we have you covered. Give us a call!

For more information or for a free, no-obligation quote, please call (201) 817-1388 or email [email protected]

Mark Herschlag is the founder and CEO of Cosmo Insurance Agency, which is based in Ocean County. Cosmo Insurance Agency offers personalized solutions for individuals and businesses looking to obtain health, life, dental, long-term care or disability insurance.