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Key Legislative and Regulatory Issues

NFDA Legislative Victories in Washington, D.C.

On Sunday, December 30, 2012, the House passed by voice vote the "Dignified Burial and Other Veterans Benefits Improvement Act of 2012." Read the full update here.

In the bill H.R. 8, the "Job Protection and Recession Prevention Act of 2012," Congress has agreed to make permanent the current estate tax law except for raising the tax rate from 35% to 40% for amounts that exceed the exclusion limit of $5 million for an individual and $10 million for a couple. Read the full update here.

Updated May 2013

Introduction

Despite all of the debate, political theater and hand-wringing going on regarding immigration reform, gun control, federal spending and the impact of the sequester on federal government employees and services, the IRS and DOJ/AP scandals and the Benghazi dust-up, the business of government grinds on. NFDA has been quite involved in several issues that will impact funeral service. Set forth below is a brief summary of these current issues.


For more information about any of these issues, contact NFDA's Advocacy Division staff:

John Fitch, senior vice president, Advocacy Division, 202-547-0441, jfitch@nfda.org
Lesley Witter, vice president, Advocacy Division, 202-547-0877, lwitter@nfda.org


  • Legislative Issues
    • Updated Health Insurance Tax (H.R.763/S.603)
    • Updated Tax Reform (no bill yet)
    • New Funeral Rule Improvement Act of 2014 (H.R. 4213)
    • New OSHA (H.R.170/S.665/H.R.1648)
    • New Estate Tax (No bill)
    • New Compensatory Time Option for Private Employers and Employees (H.R.1406)

Legislative Issues

Updated Health Insurance Tax (H.R. 763/S.603) – NFDA has joined 35 other small-business groups in supporting and actively advocating for passage of legislation to repeal the onerous health insurance tax created by the Patient Protection and Affordable Care Act.

H.R.763, entitled the "Jobs and Premium Protection Act of 2013," has been introduced in the House and now has more than 120 co-sponsors from both sides of the political aisle. A companion bill, S.603, has been introduced in the Senate and has more than 15 co-sponsors and supporters from both parties as well.

Beginning in 2014, the tax will be imposed on insurance companies that offer fully insured coverage. The tax will be assessed on the net earned health insurance premiums as a percentage of their total premiums.

The Congressional Budget Office (CBO) has stated that the tax "would be largely passed through to consumers [small and family-owned businesses] in the form of higher premiums for private coverage."

A recent study by Oliver Wyman Company found that on average, across all states from 2014-2023, premiums will increase $2,794 for small-business employees with an individual plan and $6,883 for those with a family plan. In 2014, the first year of the new tax, the average increase in premiums will range from 1.9 to 2.3 percent. By 2023, the expected increases will range from 2.8 to 3.7 percent.

With such strong support, both the chairmen of the House Ways and Means Committee and the Senate Finance Committee have indicated that these bills will be included in any tax reform legislation introduced this year. If that process stalls, these bills will most likely come to the House and Senate floor for a vote as stand-alone bills or as part of another, larger healthcare bill. NFDA will keep members updated as these bills progress through the legislative process.

Updated Tax Reform (no bill yet) – NFDA continues to actively monitor the ongoing Congressional discussions on how to reform the tax code. Our concern is what impact any reform measure may have on both the marginal and effective tax rates for corporations and individuals. We will immediately act on any proposal that either benefits our members or harms them. In that regard, NFDA has submitted comments to the chairmen of the House Ways and Means Committee and the House Small Business Committee supporting several provisions contained in a draft small-business tax reform proposal that would be very beneficial to NFDA members. A Committee Hearing on these small business reform proposals is being held this week. We will keep you advised as this process proceeds.

New Funeral Rule Improvement Act of 2014 (H.R. 4213) –

New OSHA (H.R.170/S.665/H.R.1648) – Bills have been introduced in both the House and Senate to expand the current OSHA injury and accident reporting requirement to all employers. The requirement would not only extend to employees but also to non-employee workers at a workplace site employed by contractors, temporary help agencies or employee leasing services.

Under current law, funeral service, because of its exceptional status as a low-hazard industry, as verified by the Bureau of Labor Statistics, is exempt from OSHA's injury and illness reporting requirements due to its low incident rate of injuries and illnesses. It is also exempt from maintaining a Sharps Injury Log, as otherwise would be required by the OSHA Bloodborne Pathogen Standard.

While NFDA believes neither of these bills has little chance of passing, we have nonetheless sent a letter opposing these bills to the chairman of the Senate Health, Education, Labor and Pensions Committee; the chairman of the Senate Small Business Committee, sponsor of the House bill; the chairman of the House Education and Workforce Committee; and the chairman of the House Small Business Committee urging them to respect the current exclusions in the present law.

New Estate Tax (No bill) – Just when we thought this issue had finally been resolved, President Obama included a provision in his FY 2014 budget that would reduce the current law to 2009 levels. Currently, the estate tax law provides a $5 million exclusion ($10 million for couples) and a tax rate of 40% above the exclusion. The exclusion is indexed for inflation and includes a stepped-up basis and spousal transfer. The President's proposal would reduce the exclusion to $3.5 million ($7 million for couples), and it would not be indexed for inflation. While NFDA understands there is little if any political support for the President's proposal from either Republicans or Democrats, it is nonetheless in play during the upcoming budget and tax negotiations. NFDA will monitor this issue and act to oppose it if it appears to gain support. Stay tuned.

New Compensatory Time Option for Private Employers and Employees (H.R.1406) – Under current law, only public-sector employees can receive compensatory time off in lieu of monetary overtime compensation. With certain exemptions for those serving in an executive, administrative or professional capacity, this right does not extend to the private sector. Any violation of this law carries significant penalties.

H.R.1406, the Working Families Flexibility Act of 2013, allows all employers to offer their employees the choice of paid time off, or comp time, in lieu of cash wages for overtime. Under this bill, no worker could ever be forced to take paid time off, just as no business owner would be forced to offer it. This bill does not change the 40-hour work week or how overtime pay is calculated. The same protections that have been a part of labor law for decades remain. But for some workers and businesses, comp time could be a valuable option to include in a benefits package. Specifically, H.R.1406 provides:

  • Receiving paid time off, or "comp time," for working overtime hours is completely voluntary. An employee who prefers to receive cash payment for overtime hours worked is always free to do so.
  • Requires the employer and employee to complete a written comp time agreement. An employee can withdraw from this agreement at any time and receive his or her accrued comp time in cash wages.
  • Comp time is accrued at the same rate as overtime cash wages. Employees who work more than 40 hours a week will accrue paid time off at a rate of one and one-half hours for each overtime hour worked.
  • Workers can cash out their accrued comp time whenever they choose and receive the equivalent in cash wages. Employers are required to provide cash wages within 30 days of receiving an employee request.
    • Explicitly prohibits an employer from "directly or indirectly intimidating, threatening or coercing or attempting to intimidate, threaten or coerce an employee" into taking or not taking comp time.
  • An employer who violates these anti-coercion provisions will be liable to the affected employee for "double damages," which includes both the amount of comp time owed and an equal amount in cash wages.
  • In addition to new provisions prohibiting coercion, H.R.1406 ensures that all existing enforcement remedies – including action by the U.S. Department of Labor – are available to workers if an employer fails to pay cash wages for overtime hours worked.

H.R.1406 passed the House on May 8 and now goes to the Senate for action. NFDA will keep members updated as this bill proceeds through the legislative process. NFDA submitted a letter of support for passage of H.R. 1406 to the Chairman of the House Committee on Education and Workforce. A similar letter will also be submitted to the Chairman of the Senate Health, Education, Labor and Pensions Committee.


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Regulatory Issues

Updated Centers for Disease Control and Response – NFDA has begun discussions with representatives of the CDC's Office of Public Health Preparedness and Response to establish a working partnership on issues of importance to funeral service. We believe this new relationship will be very beneficial to us and to them, especially in the area of mass fatality management. In that regard, NFDA Advocacy staff met recently with the associate director for policy, planning and evaluation on two projects they are undertaking to determine how NFDA can be a resource for information on these projects. One is the National Health Security Preparedness Index, which is designed to determine, on a state-by-state basis, the preparedness of the health and public health sector to respond to an all-hazards event. Funeral service is included in this index but in a very limited way. The CDC thinks NFDA can be a valuable resource in this project. The second project is its Enhanced Electronic Death Registration Project, which is designed to obtain real-time data on deaths on a state, regional and national basis to determine any trends involving any biologic or other cause. The emphasis is to encourage all states to develop on electronic death registration system so the CDC can gather death information in a timely manner. NFDA pointed out some deficiencies in the plan, and the CDC wants NFDA and its state associations to become more involved in this project.


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