The U.S. Department of Justice unveiled a new pilot program and announced several important updates to its Evaluation of Corporate Compliance Programs regarding corporate compensation incentives and clawbacks.

In a recent ruling, the National Labor Relations Board found an employer violated the National Labor Relations Act when it offered furloughed employees a severance agreement that included overbroad nondisparagement and confidentiality provisions.

Recent news has shined a spotlight on the legal consequences of mass layoff situations. Employers should take steps now to prepare for possible reductions in their workforce.

Washington Governor Jay Inslee, on March 30, 2022, signed into law amendments to the state’s Equal Pay and Opportunity Act, which soon will require most Washington employers to include pay ranges in their job postings.

This update outlines contractual and procurement considerations that we are seeing clients confront as they respond to compliance and implementation challenges from these new requirements.

New cybersecurity developments and observations ... warrant prompt consideration by plan sponsors and other fiduciaries of employee benefit plans subject to ERISA.

There are many new and expanding legal requirements for group health plans and issuers of group health plan coverage to pay attention to this year.

The U.S. Department of Labor’s Occupational Safety and Health Administration issued its long-awaited emergency temporary standard requiring all employers with a total of 100 or more employees to mandate vaccination and/or weekly COVID-19 testing. OSHA also released a comprehensive FAQ to address questions.

On October 25, 2021, the U.S. Equal Employment Opportunity Commission (EEOC) updated its guidance related to the COVID-19 pandemic, adding a brand-new section addressing religious objections to COVID-19 vaccine mandates.

The U.S. Department of Labor (DOL) published a proposed regulation on October 14, 2021, that would clarify how fiduciaries of private sector employee benefit plans should apply ERISA’s fiduciary duties of prudence and loyalty when making investment decisions and exercising shareholder rights.

With the surge of COVID-19 cases due to the Delta variant, many employers are considering whether to require employees to be vaccinated, how to encourage employee vaccinations, and the implications of vaccine policies for their businesses.

On April 15, 2021, in response to the ongoing COVID-19 situation, the U.S. Internal Revenue Service issued a temporary deviation from the handwritten signature requirement for a limited list of tax forms. This issue includes elections under Section 83(b) of the Internal Revenue Code, allowing taxpayers and representatives to use electronic or digital signatures when signing such forms. The IRS memorandum was issued about a month after Perkins Coie LLP, Carta.com, and other coalition partners sent a letter to the IRS specifically requesting such temporary relief.

On April 14, 2021, the US Department of Labor (DOL) released three-part guidance on cybersecurity issues for employee benefit plans, marking its first significant commentary on the issue since its comprehensive, but non-binding, report in late 2016. The DOL’s guidance provides “tips” and “best practices” for ERISA plan sponsors, responsible fiduciaries, recordkeepers, service providers, and participants in appropriately safeguarding non-public plan and participant information against cybersecurity threats. 

The American Rescue Plan Act of 2021 (ARPA) includes a 100% federal subsidy of COBRA premiums (including the up-to-2% administrative fees) during the period of April 1, 2021, through September 30, 2021. Earlier this week, EBSA published clarifying FAQs and model notices related to the COBRA subsidy. This update discusses the guidance most relevant to employers and highlights areas where additional guidance is still needed.

The American Rescue Plan Act of 2021 (ARPA) includes a number of provisions requiring immediate action by employers.

This update examines in detail each form of multiemployer pension plan relief under the ARPA, as well as potential impacts of the ARPA on employers participating in underfunded multiemployer pension plans.

Much of the previous relief that had been granted to cafeteria plans during the COVID-19 pandemic was set to expire after 2020.

President Donald Trump signed into law the Consolidated Appropriations Act, 2021 (the Omnibus Bill) on December 27, 2020.

Employee benefits professionals have faced many challenges in 2020.

In anticipation of the upcoming reporting season, we highlight rule changes, guidance, and trends for public companies to consider in preparing annual report and proxy statement disclosures in 2021.

COVID-19 has forced many employers to make unanticipated changes to their workforce, with many retailers rolling out a combination of furloughs, layoffs, and breaks in service to address changing market demands and shelter-in-place orders.

In response to the ongoing coronavirus (COVID-19) pandemic, the U.S. Congress, the executive branch, and the Internal Revenue Service (IRS) have taken several actions intended to provide immediate relief to taxpayers.

The U.S. Securities and Exchange Commission on July 22, 2020, adopted final amendments to its proxy solicitation rules to codify the SEC’s longstanding view that proxy voting advice generally constitutes a solicitation within the meaning of the federal proxy rules and is subject to anti-fraud rules.

The Seattle City Council passed a bill creating a new payroll tax on persons engaged in business in Seattle. While the ordinance has not yet been signed by the mayor (as of publication), the tax was passed by the council on July 6, 2020, by a veto-proof majority (7-2) and is expected to become law effective January 1, 2021.

The U.S. Department of Labor (DOL) has issued a final rule establishing a new “safe harbor” method for satisfying ERISA and DOL’s requirements for electronic distribution of certain ERISA-governed retirement plan documents.

Many employers have sought to leverage or make changes to their employer-sponsored benefits to address economic and health-related burdens faced by their employees during the COVID-19 pandemic.

On May 15, 2020, the Small Business Administration (SBA) released an application for loan forgiveness under the Paycheck Protection Program (PPP).

The U.S. Department of Labor (DOL) issued revised model general and election notices on Friday, May 1, 2020.

Many employee benefit plan sponsors, administrators, and fiduciaries have been asking about regulatory relief in response to administrative challenges created by the COVID-19 pandemic.

Recognizing the high volume of COVID-19 content being published, Perkins Coie developed a one-stop, integrated resource page that addresses key legal and business considerations for companies across essential business areas, from insurance coverage and labor and employment, to privacy and security, corporate governance, tax, construction, supply chain, and more.

As federal and state governments respond to COVID-19, employers and plan fiduciaries must also address the evolving issues arising under employer-sponsored health plans.

The Families First Coronavirus Response Act was passed by the U.S. House of Representatives shortly before 1:00 a.m. on March 14, 2020.

The Families First Coronavirus Response Act was passed by the U.S. House of Representatives shortly before 1:00 a.m. on March 14, 2020.

On January 21, 2020, the Internal Revenue Service (IRS) released guidance for tax-exempt organizations on how tax-exempt organizations may obtain a refund or credit for prior year unrelated business income tax (UBIT) incurred for qualified transportation fringe benefits.

A decision by the Oregon Court of Appeals in Maza v. Waterford Operations LLC, 300 Or. App. 471 (2019), raises the bar for Oregon employers on meal breaks, making employers liable for missed meal breaks even if they make every effort to provide them.

The U.S. Department of Labor (DOL) issued proposed regulations on October 23, 2019, providing for a new electronic-delivery safe harbor applicable to certain required disclosures for ERISA-governed retirement plans.

The IRS issued final regulations on September 19, 2019, easing the 401(k) hardship distribution rules.

Thirty-five years after deciding that arbitration clauses in employee benefit plans governed by the Employee Retirement Income Security Act of 1974 (ERISA) were unenforceable, the U.S. Court of Appeals for the Ninth Circuit has reversed itself by approving the use of mandatory arbitration clauses and class action waivers in ERISA-governed benefit plans in Dorman v. Charles Schwab Corp.

Washington Governor Jay Inslee signed into law legislation in April 2019 that requires school districts to allow parents and guardians to administer to their child marijuana-infused medications on school grounds, in school vehicles and at school-sponsored activities.

As expected, Governor Jay Inslee signed legislation that will significantly restrict the use of noncompetition agreements for Washington-based employees and independent contractors.

Last week, the Washington State Legislature passed a proposal that, once signed into law, will significantly restrict the use of noncompetition agreements in Washington.

More than 50 years after the Equal Pay Act of 1963 required equal pay for equal work, a wage gap persists between similarly situated men and women in the workforce.

The federal Fair Credit Reporting Act (FCRA) applies to employers who obtain “consumer reports” from a “consumer reporting agency” for employment purposes.

The U.S. Supreme Court this week overruled longstanding precedent to hold that public-sector unions may no longer extract agency fees from nonconsenting employees who have opted not to join a union.

The Washington Equal Pay Opportunity Act will go into effect on June 7, 2018. House Bill 1506, signed by Governor Jay Inslee on March 21, 2018, amends the Washington Equal Pay Act, RCW 49.12.175, to “address income disparities, employer discrimination, and retaliation practices, and to reflect the equal status of all workers in Washington state.” This statute goes beyond federal equal pay legislation by providing additional protections for employees and imposing restrictions on employers. An employer who discriminates based on gender in providing compensation is guilty of a misdemeanor.

As a result of a declining union workforce, bankruptcies of employers contributing to multiemployer pension plans (MEPPs), and tax rules that prevented MEPPs from developing sufficient reserves, many MEPPs have become significantly underfunded.

The recent tax reform bill, commonly referred to as the Tax Cuts and Jobs Act of 2017 (the Act), was signed into law on December 22, 2017. The Act includes a new income tax deferral regime for certain employee stock options and restricted stock units (RSUs) granted by eligible private corporations under broad-based programs that are exercised or settled after December 31, 2017.

The King County Superior Court held on November 17, 2017, that Seattle’s recently adopted city income tax is illegal under Washington law.

The City of Seattle adopted Ordinance 125339 on July 14, 2017, which imposes an income tax on Seattle residents and certain irrevocable trusts.

As federal and state governments struggle to address future healthcare regulation, demand for healthcare that is cheaper, better and faster continues to surge.

On May 4, 2017, the U.S. House of Representatives approved the American Health Care Act (AHCA) by a vote of 217 to 213 (with 20 Republicans voting against the bill), sending the AHCA to the Senate.

The U.S. Department of Health and Human Services recently announced yet another HIPAA privacy and security settlement involving Protected Health Information on a stolen laptop.

Are you an Applicable Large Employer (ALE) that has received rejected Forms 1095-C from the IRS? If so, you are not alone.

This update was also published by Employee Benefit Advisor on 05.04.2017, "Views Assessing Employer Shared Responsibility Penalties," and by Society for Human Resource Management on 05.05.2017, "Employer Shared Responsibility: Have Penalties Been—or Will Penalties Ever Be—Assessed?"

As deliberations over a replacement of the Affordable Care Act (ACA) continue in the U.S. House of Representatives, the fate of the ACA’s Cost-Sharing Reduction subsidies may be at stake.

On the last day before the U.S. Congress began its spring recess, the U.S. House of Representatives amended the now consolidated bill H.R. 1628, known as the American Health Care Act.

Although the fate of the Affordable Care Act remains undecided, enforcement of the HIPAA privacy and security regulations by the Office for Civil Rights of the U.S. Department of Health and Human Services is ongoing, with three settlements and one assessment of penalties already in 2017.

The much-anticipated vote by the U.S. House of Representatives on the “American Health Care Act,” also known as “AHCA” or the “Obamacare replacement bill,” was cancelled last week, leaving many to ask “what now?”

The U. S. House of Representatives (the House) proposed two bills to “repeal and replace Obamacare” this week, and while many popular consumer protections under the Patient Protection and Affordable Care Act (ACA) look to be preserved at this stage, some significant changes are included that could have an impact on employers and other plan sponsors if signed into law. We’ve highlighted a few of these potential changes below. 

The SEC’s Division of Investment Management issued a no-action letter on January 11, 2017 explicitly permitting brokers to set their own commission rates for sales of so-called “clean shares” of mutual funds.

With the filing of a class action complaint in late 2016 in the U.S. District Court for the Southern District of Florida, Wal-Mart Stores, Inc. became the latest large company accused of failing to provide adequate notices as required by COBRA.

The SEC’s Division of Investment Management released a Guidance Updateon December 19, 2016, addressing certain procedural issues that have arisen in connection with the so-called “Fiduciary Rules” adopted by the U.S. Department of Labor.

The Qualified Small Employer Health Reimbursement Arrangement (QSEHRA), part of the 21st Century Cures Act signed into law by President Barack Obama on December 13, 2016, makes available to small employers a new option to provide health reimbursements or payments to eligible employees by setting aside IRS guidance that made stand-alone health reimbursement arrangements (HRAs) subject to penalties under the ACA.

During his campaign, President-elect Trump promised to make the repeal and replacement of the Affordable Care Act (ACA) a priority. Now that the election is over, what should employers expect?

Two new statutes, signed into law by Arizona Governor Doug Ducey this legislative session, attempt to set new standards on defining the employment relationship and how wages are regulated.

The U.S. Department of Health and Human Services Office for Civil Rights recently announced the long-awaited launch of Phase 2 of its HIPAA Audit Program.

As of February 1, 2016, employers with employees who work in Tacoma must comply with two new legal requirements.

The Securities and Exchange Commission (SEC) recently adopted final rules implementing one of the last four remaining executive compensation requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The Securities and Exchange Commission (SEC) recently proposed another long-awaited set of rules to implement the additional clawback policy required under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).

The Securities and Exchange Commission recently proposed rules that would require public companies to disclose the relationship between executive compensation actually paid and the company’s financial performance.

Employers in the San Francisco Bay Area must now help their employees use alternative transportation under a program approved by the Bay Area Air Quality Management District (BAAQMD) and the Metropolitan Transportation Commission.

The Seattle employment community is abuzz about the prospect of a $15 minimum wage for all Seattle employees, which would make it the highest minimum wage in the nation.

The Affordable Care Act added the so-called “Play-or-Pay” mandate or “Employer Shared Responsibility” provisions to the Internal Revenue Code (the Code).

The IRS announced the Year 2014 cost-of-living adjustments for various provisions affecting employee benefit plans.

On September 13, 2013 the U.S. Department of the Treasury (IRS), the U.S. Department of Health and Human Services (HHS), and the U.S. Department of Labor (DOL), collectively referred to herein as the Departments, coordinated the issuance of guidance regarding the application of certain provisions of the Affordable Care Act (ACA) to health reimbursement arrangements and other employer-sponsored healthcare arrangements.

Recently, the SEC, by a vote of 3 to 2, proposed long-delayed and controversial rules to implement the “CEO pay ratio” disclosure mandated under the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The proposed rules, voted in on September 18, 2013, would require U.S. public companies to disclose the median annual total compensation of all employees and the ratio of that median to the annual total compensation of the company’s CEO.

The employer shared responsibility provisions, sometimes referred to as pay-or-play, of the Affordable Care Act (ACA) will take effect on January 1, 2015, but in order to be ready to comply, some employers need to take action now.

In response to the Supreme Court decision in United States v. Windsor, 133 S. Ct. 2675 (2013), the Internal Revenue Service issued Revenue Ruling 2013-17 (Ruling) on August 29, 2013, in which the IRS set forth the following federal tax principles:

The final regulations implementing the Health Information Technology for Economic and Clinical Health (HITECH) Act were issued in January and compliance is required by September 23, 2013.

On July 22, the Department of Labor (DOL) issued Field Assistance Bulletin No. 2013-02 (FAB 2013-02) that extended the deadline for plan sponsors to provide 2013 annual participant fee disclosures by six months.

The National Labor Relations Board, the agency that enforces federal labor law, continues to challenge employer policies that seek to impose confidentiality constraints on employees.  This is unlikely to change now that the Senate has confirmed President Obama’s nominations for all five members, bringing the NLRB to full strength for the first time in years.

The United States Supreme Court significantly changed the treatment of same-sex spouses under qualified retirement plans in United States v. Windsor.  For the implications of Windsor and its companion case Hollingsworth v. Perry on health and welfare plans, please read our prior Client Update.

Two controversial cases involving same-sex marriage were decided on June 26, 2013 by the United States Supreme Court.  The first is United States v. Windsor and the second is Hollingsworth v. Perry.

The U.S. Department of the Treasury announced today that after hearing and considering the concerns of employers about the complexity of compliance with the Play-or-Pay requirements under the Affordable Care Act, it is postponing the mandatory employer and insurer reporting requirements until 2015.

The Affordable Care Act (the ACA) established the Patient-Centered Outcomes Research Institute (the Institute) in order to provide comparative clinical effectiveness research data so that patients, health care providers, purchasers of health care and insurance products and policy-makers can make informed decisions.

Recently, we published a Client Updateexplaining how the Play-or-Pay mandate, or Employer Shared Responsibility provision, under the Affordable Care Act (ACA) generally works.

Portland has become just the fourth U.S. city to require that employers provide sick leave. The Portland ordinance goes into effect January 1, 2014. Following is a brief summary of the ordinance. As the effective date approaches, we will provide updates dealing with the many traps and reporting difficulties created by the ordinance.

The Affordable Care Act added the so-called “Play or Pay” mandate or “Employer Shared Responsibility” provisions to the Internal Revenue Code (the Code).  Starting in 2014, certain employers may be subject to a penalty tax, or “Employer Shared Responsibility Payment,” if (1) they fail to offer the opportunity to enroll in an employer-sponsored health plan that offers “minimum essential coverage” (MEC) to substantially all full-time employees (and certain dependents); or (2) MEC is offered but it is unaffordable or does not provide the required minimum value; and (3) at least one of the employer’s full-time employees receives a premium tax credit or cost-sharing reduction for purchasing health insurance through an Exchange.

The Affordable Care Act requires employers to provide written notice of coverage options available through an Exchange (the Exchange Notice) to each employee by March 1, 2013 and to each new employee thereafter on his or her date of hire.

Final implementing regulations for many provisions of the HITECH Act (Health Insurance Technology for Economic and Clinical Health Act) were issued by the Department of Health and Human Services recently, and will appear in the Federal Register on January 25, 2013. Informally referred to as the Omnibus Rule, the regulations address a number of changes to the HIPAA Privacy Rule, HIPAA Security Rule, HIPAA breach notification rule, HIPAA privacy and security enforcement provisions, Business Associate definition and agreement requirements, and the interaction between HIPAA and the Genetic Information Nondiscrimination Act.

To kick off 2013, the Internal Revenue Service (IRS) issued Revenue Procedure 2013-12 updating the Employee Plans Compliance Resolution System (EPCRS), the voluntary compliance program for employer-sponsored retirement plans.  Changes become effective on April 1, 2013, but plan sponsors may elect to use the revised program as soon as the IRS releases the newly created Forms 8950 and 8951. 

Public companies preparing for the upcoming 2013 proxy season will need to keep in mind a number of new developments related to executive compensation.

The Washington Supreme Court has just issued its unanimous decision in the Washington State Nurses Association case.  The court concluded that when a full-time employee (working 40 hours a week) works through a paid rest break, the employee is entitled to overtime pay on top of his or her regular pay.

The IRS has announced the Year 2013 cost-of-living adjustments for various provisions affecting employee benefit plans.

In early 2010, the IRS surprised the benefits community by stating in Notice 2010-6 that deferred compensation arrangements that condition payment on employee action (such as the execution of a release, noncompetition agreement or nonsolicitation agreement) violate the deferred compensation tax rules of Code Section 409A if the employee can accelerate or delay the year of payment.

Seattle's new "Sick and Safe Time" law goes into effect September 1, 2012.  It requires virtually all employers to provide a minimum amount of paid leave to employees who work in the City of Seattle, even occasionally.  The fact that the employer itself may be located outside the city does not matter—only the location where the employee works is relevant.

Responsible fiduciaries of ERISA defined contribution or defined benefit plans should have received fee disclosures from each of a plan's covered service providers by July 1, 2012, as required pursuant to the Department of Labor's final regulations under ERISA Section 408(b)(2) (the "408(b)(2) regulations").

A recent decision illustrates the dangers of even a modest wage-hour claim under Washington law.  A $12,000 overtime dispute turned into a bill for over $500,000 before the costs of appeal.  According to the decision, an employee was incorrectly classified as an "administrative" employee exempt from Washington's overtime requirements.  He was awarded $12,000 for his unpaid overtime.

The U.S. Supreme Court's decision on the health care reform law has been subject to a lot of analysis already, but the bottom line is that all of the health care reform provisions that apply to group health plans and insurers that sell coverage to group health plans have been left standing and employers must make sure that their health plans comply.

The IRS recently issued Notice 2012-40 providing guidance on the $2,500 limit on salary reduction contributions to health flexible spending arrangements (“health FSAs”) under cafeteria plans.  The $2,500 limit is a new requirement that was added by the Patient Protection and Affordable Care Act and many plan sponsors (especially those with non-calendar year plans) have had compliance questions.  The IRS Notice provides clarifications on several important points.

A small cardiac surgery practice (two owners; currently five physicians) is the latest covered entity to enter into a settlement agreement and Corrective Action Plan (CAP) with the U.S. Department of Health and Human Services, Office for Civil Rights (OCR), to resolve alleged violations of the HIPAA privacy and security regulations.  In announcing the $100,000 settlement OCR Director Leon Rodriguez stated, "OCR expects full compliance no matter the size of a covered entity."

BlueCross BlueShield of Tennessee (BCBST) has agreed to pay $1.5 million to the U.S. Department of Health and Human Services (HHS) and enter into a Corrective Action Plan (CAP) to settle alleged violations of the HIPAA privacy and security regulations. The enforcement action arose from the theft of 57 hard drives that contained audio and video recordings of customer service calls and included electronic protected health information (ePHI) of over one million individuals. The settlement resolves HHS’s first enforcement action in connection with the Health Information Technology for Economic and Clinical Health (HITECH) Act Breach Notification Rule.  The CAP also provides insight into the kinds of security measures HHS expects companies in possession of ePHI to have in place.

Employers that allow dependents to be covered under their health plans need to be aware of health care reform rules that may limit their ability to retroactively remove ineligible dependents from coverage.

The IRS recently issued Notice 2012-9, which provides clarifications and additional guidance on the new employer obligation, added by the health care reform law, to report on Form W-2 the cost of health coverage provided to employees.

The Department of Health and Human Services has begun a pilot program of HIPAA privacy and security audits for health care providers and health plans, and the audits will have some very short turnaround times.

As part of the changes made by health care reform, Section 6051(a)(14) of the Internal Revenue Code requires employers to report on Form W-2 the aggregate cost of employer-sponsored health coverage provided to employees.

The IRS announced the Year 2012 cost-of-living adjustments for various provisions affecting employee benefit plans.

On August 30, the National Labor Relations Board NLRB published new rules that require virtually all private sector employers to post notices informing employees of their rights under the National Labor Relations Act—the federal law that protects employees who engage in union and other concerted activities.

Understanding the many SEC, NYSE, Nasdaq and state law issues that affect their companies can be a bewildering task for directors and officers. To help with this is the just released fourth edition of The Public Company Handbook: A Corporate Governance and Disclosure Guide for Directors and Executives, a "plain English" guide for directors and executives seeking to familiarize themselves with legal matters facing public companies.

2010 has seen a number of new developments concerning employee benefit plans and also marks the deadline for amending plan documents to come into compliance with certain developments from recent years. Below is a brief list of some significant plan issues from 2010 that may require prompt action. Items discussed in this update are only general descriptions of the required amendments and the actions that may be necessary. For more information on any topics discussed here, contact an attorney in our Employee Benefits and Executive Compensation practice group.

The SEC recently issued proposed rules to implement the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act that mandate shareholder advisory votes on executive compensation (the say-on-pay vote), on the frequency of the say-on-pay vote, and on golden parachute compensation arrangements, as well as related disclosure requirements.

The IRS announced the Year 2011 cost-of-living adjustments for various provisions affecting employee benefit plans.  The following table shows certain Year 2011 limits and those from prior years.  2011 limits listed below remain unchanged from 2010.

Among the many tax issues implicated by separation arrangements are two relatively new developments that may require special attention when drafting offer letters, severance plans, release agreements, change in control arrangements and similar separation arrangements.  Employers should review their separation arrangements by year-end to address these new developments.

Perkins Coie is pleased to announce the publication of a new edition of the Executive Compensation Disclosure Handbook: A Practical Guide to the SEC's Executive Compensation Disclosure Rules, a publication written by Perkins Coie attorneys and published by RR Donnelley.

The Departments of Labor, Health and Human Services and Treasury (the "Departments") recently issued Interim Final Regulations (the "Regulations") on grandfathered health plans under the Patient Protection and Affordable Care Act ("PPACA").

Under a new Federal Acquisition Regulation ("FAR") requirement, effective July 8, 2010, federal contractors must disclose first-tier subcontractor award information for contracts valued at $25,000 or more.

Congress has approved the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and President Obama has signed it into law.

President Obama signed the Patient Protection and Affordable Care Act ("PPACA") on March 23, 2010 and the Health Care and Education Reconciliation Act ("RA") on March 30, 2010 (together, the "Acts").

A federal district court in Michigan has held that certain supplemental unemployment compensation benefits (SUB pay) are not "wages" subject to Federal Insurance Contributions Act (FICA) taxation.

Prototype and volume submitter defined contribution plans (such as profit sharing, 401(k) and money purchase pension plans) must be amended and restated for the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA Restatement) and subsequent legislation and guidance by April 30, 2010.  Employers who maintain a prototype or volume submitter defined contribution plan should have been contacted by their document provider who will provide the required restatement.

On December 19, 2009, the COBRA subsidy program first introduced by the American Recovery and Reinvestment Act of 2009 (ARRA) was extended as a part of the Department of Defense Appropriations Act, 2010 (2010 Act).  The extension allows individuals who are involuntarily terminated up to February 28, 2010 to pay only 35% of the premium for COBRA coverage and extends the maximum duration of subsidized coverage from 9 to 15 months.

The Internal Revenue Service recently issued new final regulations addressing the return and information statement requirements applicable to exercises of incentive stock options, or ISOs, and transfers of shares purchased under an employee stock purchase plan, or ESPP.  The IRS has waived the requirements under the new regulations for ISO exercises and transfers of ESPP shares that occur during 2009.

The Securities and Exchange Commission recently adopted final rules to require enhanced compensation and corporate governance disclosure for public company proxy statements and other SEC filings.  The final rules reflect changes that clarify, and in some instances broaden, the proposed rules issued on July 17, 2009.  The SEC designed these amendments to improve corporate disclosures and allow shareholders to make more informed voting and investment decisions.

Public companies should take steps to determine whether any amendments may be required to new and outstanding compensatory arrangements in light of Section 162(m) of the Internal Revenue Code and certain transition relief under Revenue Ruling 2008-13.

The IRS announced the Year 2010 cost-of-living adjustments for various provisions affecting employee benefit plans.

The Securities and Exchange Commission (SEC) recently released new proposed rules concerning compensation and corporate governance disclosure for public company proxy statements and other SEC filings.

The Securities and Exchange Commission recently released new proposed rules concerning compensation and corporate governance disclosure for public company proxy statements and other SEC filings.  The SEC intends these proposed amendments to improve corporate disclosures and allow shareholders to make more informed voting and investment decisions.

The Pension Protection Act of 2006 made numerous changes to rules regarding employee benefit plans, including tax-qualified defined benefit and defined contribution plans.  Although the changes took effect at various dates (and plans have been required to operationally comply with each change as of the specified effective date), amendments reflecting these changes generally do not have to be adopted until the last day of the plan's 2009 plan year.

The deadline is fast approaching for amending deferred compensation arrangements that are subject to Section 409A of the Internal Revenue Code.

The IRS recently issued Revenue Ruling 2008-13, which clarifies the IRS's new position with
respect to the applicability of the performance-based compensation exception for purposes of Section 162(m) of the Internal Revenue Code and grants transition relief to provide public companies an opportunity to review outstanding compensation plans, agreements and other arrangements in light of the IRS's new position.

Last week the IRS issued Notice 2007-86, which delays until January 1, 2009 the deferred compensation final regulations of Internal Revenue Code Section 409A and generally provides expanded relief and guidance.  The IRS also separately issued Notice 2007-89, which generally extends for the 2007 tax year prior IRS guidance to employers and other service providers regarding reporting and withholding obligations for annual deferrals of compensation and amounts includible in gross income due to Section 409A violations.  This update summarizes key aspects of both notices and provides practical guidance.

On September 10, 2007, the IRS issued Notice 2007-78 providing limited relief and guidance for the deferred compensation tax rules of Internal Revenue Code Section 409A, including a limited extension until December 31, 2008 of the deadline to adopt documents that comply with Section 409A. This update summarizes the key aspects of the notice and offers practical tips for employers and other service recipients.

This week the IRS issued guidance on identifying "covered employees" for purposes of Section 162(m) of the Internal Revenue Code in response to the SEC's recent amendments to its executive compensation disclosure rules. This Update summarizes the key highlights from this IRS guidance.

Last week the IRS issued the long-awaited final regulations under Section 409A of the Internal Revenue Code, which generally provides that amounts deferred under a "nonqualified deferred compensation plan" are currently includible in taxable income if not subject to a substantial risk of forfeiture, unless the plan meets specified design and operational requirements. Failure to comply with the applicable requirements of Section 409A can result in significant income tax consequences, including a 20% additional tax imposed on the employee or independent contractor.

Perkins Coie is pleased to announce a revised version of the Executive Compensation Disclosure Handbook: A Practical Guide to the SEC's New Rules, a publication written by Perkins Coie attorneys that provides a complete, plain English explanation of the SEC's executive compensation and related disclosure requirements.

Perkins Coie is pleased to announce the Executive Compensation Disclosure Handbook: A Practical Guide to the SEC's New Rules. This handbook is the most practical, plain English guide available for public company management, directors and general counsel on the SEC's new requirements for public company disclosure and reporting of executive and director compensation and related issues.

The Securities and Exchange Commission just announced that it has amended its new executive officer and director compensation disclosure rules, effective immediately. The FASB requires companies to recognize the costs of equity awards over the period in which an employee must provide service in exchange for the award under Statement of Financial Accounting Standards No. 123 (revised 2004) Share-Based Payment. The new SEC amendments will more closely align the reporting of equity awards in the Summary Compensation Table and the Director Compensation Table to the amounts that are disclosed in the financial statements under FAS 123R.

In the Delaware Supreme Court's recent opinion in the Disney case, Justice Jacobs provided better "best practices" advice for compensation committee decision making (and by analogy, board and other board committee decision making) than we may have seen in decades. The court also rejected the argument that making a decision in the absence of adequate information and deliberation amounts to bad faith.

The federal securities laws already require clear, concise and understandable disclosure about the amount and type of all compensation paid to chief executive officers and other highly compensated executives of public companies. In recent years widespread and increasing interest in executive pay and the perceived inadequacy of current disclosure spawned frequent front-page headlines and heated rhetoric from members of Congress and shareholder advocates.

Internal Revenue Code Section 409A, along with recent changes in financial accounting rules, has significantly increased the focus of private companies on accurately valuing their common stock for purposes of granting options and other equity incentive awards. Section 409A has upped the ante by imposing severe tax consequences on individuals for certain stock-based compensation that does not comply with the new deferred compensation tax rules, including stock options granted with an exercise price that is less than the fair market value of the company's common stock on the grant date.

The IRS has issued proposed regulations that expand the guidance available for complying with the deferred compensation tax rules of Section 409A of the Internal Revenue Code. Section 409A generally provides that amounts deferred under a nonqualified deferred compensation plan are currently includible in income if not subject to a substantial risk of forfeiture, unless the plan meets specified design and operational requirements. Failure to comply can result in significant federal income tax consequences, including a 20% additional tax.

On December 20, 2004, the Treasury Department and the Internal Revenue Service issued Notice 2005-1 providing the first installment of guidance for the deferred compensation provisions of the American Jobs Creation Act of 2004, which are contained in new Section 409A of the Internal Revenue Code.

Congress recently approved the American Jobs Creation Act of 2004 (H.R. 4520), which includes provisions that impose significant new restrictions on deferred compensation. If these restrictions are not satisfied, deferred compensation amounts are taxable when vested and subject to tax penalties. President Bush is expected to sign the Act, but as of October 19th has not done so. This Update highlights the Act's key changes to deferred compensation requirements and offers practical guidance.

The Securities and Exchange Commission (SEC) voted at its open meeting on Tuesday to adopt final "internal control" rules implementing Section 404 of the Sarbanes-Oxley Act. The SEC also voted to adopt final rules regarding Section 302 and 906 certification of disclosures in periodic reports.

On January 28, 2003, the SEC published final rules implementing Section 306(a) of the Sarbanes-Oxley Act of 2002, which generally prohibits insider trading during pension plan blackout periods. These rules became effective on January 26, 2003; however, the requirement to file notices of blackout periods with the SEC on Form 8-K is not effective until 60 days after publication of the rules in the Federal Register. For blackout periods occurring between January 26, 2003 and February 25, 2003, reporting companies should furnish blackout notices to directors and executive officers as soon as reasonably practicable. Blackout notices are not required for currently effective blackout periods that started before January 26, 2003.

This Perkins Coie LLP Update summarizes the impact of the Sarbanes-Oxley Act of 2002 on public company executive compensation and makes practical suggestions for complying with the Act. The following provisions of the Act affect executive compensation arrangements and benefits:

Leading during a health pandemic requires strength, vision, and an ability to look around corners. Join us for a two-part webinar series that will highlight a variety of risks and opportunities that company leaders should be aware of as we navigate through major business changes.

Join us for a timely webinar that will address key considerations for businesses exploring the financing opportunities made available under the CARES Act. 

In this podcast, Danielle shares her perspective on stock-based executive compensation design for small and midsize private companies. She also gives Candie a vocabulary lesson on the options for corporations and LLCs. The episode finishes with considerations for candidates when evaluating offers that include equity.

We are very pleased to announce that Perkins Coie partner Evelyn Cruz Sroufe will moderate the panel, “Directors Speak: The Changing Dynamics of the Boardroom” on October 9th, and that on October 9th, Perkins Coie partner, Sue Morgan, will participate in the panel, “Proxy Season: 2015 Review and 2016 Preview”.

This seminar examined the latest developments and trends, provided insight into what lies ahead and impart practical, actionable guidance on the crucial issues facing today's corporate and securities law practitioners and finance professionals.