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The Obama administration announced earlier this month that businesses will be provided a one-year reprieve before they are required to comply with the mandate to provide all employees with health care insurance under the Affordable Care Act (ACA). The extension, announced by the U.S. Treasury Department, cited a need for more time to implement the complex requirements.

Specifically, Mark J. Mazur, assistant secretary for tax policy with the Treasury Department, said the move is designed to allow the Treasury to simplify the new reporting requirements and “provide time to adapt health care coverage and reporting systems while employers are moving toward making health coverage affordable and accessible for their employees.”

Under the ACA, businesses with 50 or more employees must provide affordable health benefits to at least 95 percent of their workforce or pay a penalty (the “pay or play” mandate). The extension of “pay or play” is especially welcome news to smaller employers that worried that the cost of the available alternatives would be too burdensome to bear.

Looking forward, the Treasury Department announced plans to this summer publish formal guidelines to assist employers with reporting requirements. The ACA requires information reporting by insurers and some employers with respect to the health coverage offered to their full-time employees. Treasury officials intend to “strongly encourage” employers to implement the information reporting requirement of ACA in 2014. Employers that implement the information reporting requirement will provide a test of the system and contribute to a smoother transition in 2015.

Employers should use the additional time and the Treasury Department’s guidelines to prepare for the transition. Employers must be mindful that the one-year reprieve is a delay – not a repeal – of the ACA.

Oregon passes workplace protection law for unpaid interns

On June 13, Oregon Gov. John Kitzhaber signed into law a bill extending employment discrimination protection to interns. The new law grants unpaid interns legal recourse under Oregon’s employment discrimination laws for workplace violations – including sexual harassment, unlawful discrimination and retaliation for whistleblowing.

The new law defines interns who are entitled to protection as individuals who are performing work for an employer for the purpose of training if: (a) the employer is not committed to hire the person performing the work at the conclusion of the training period; (b) the employer and the individual agree in writing that he or she is not entitled to wages for the work performed; and (c) the work performed:

• Supplements training given in an educational environment that may enhance the employability of the intern;

• Provides experience for the benefit of the person performing the work;

• Does not displace regular employees;

• Is performed under the close supervision of existing staff; and

• Provides no immediate advantage to the employer providing the training and may occasionally impede the operations of the employer.

This definition tracks the test for unpaid interns who are exempt from the Fair Labor Standards Act’s minimum wage and overtime requirements.

Under the new law, unpaid interns are now protected from discrimination and retaliation on the basis of race, color, religion, sex, sexual orientation, national origin, marital status, age, military service, and disability, and discrimination and retaliation based on certain societal obligations – including aiding in criminal or civil proceedings and testifying before the Oregon Legislature.

The statute also provides protection for unpaid interns who report, in good faith, information that the intern believes is evidence of a violation of a state or federal law, rule or regulation.

The new law also extends discrimination protection to Oregon unpaid interns who are victims of domestic violence, harassment, sexual assault or stalking. As with paid employees, the employer may require certification in the form of a police report, protective order or other evidence from a court, administrative agency, mental health professional or attorney that the intern is appearing in a proceeding or undergoing treatment relating to the domestic violence, harassment, sexual assault or stalking.

Additionally, collecting, testing or using genetic information of the interns is prohibited. Employers in Oregon cannot require interns to pay for medical testing as a condition of their internship unless a medical examination or health certificate is required pursuant to federal or state law or local ordinance. Finally, employers may not restrict interns’ lawful use of tobacco during nonworking hours.

The new law does not create an employment relationship under Oregon’s wage and hour law, employment laws regarding minors, state occupational safety and health laws, workers’ compensation laws, unemployment laws, or state laws governing employment agencies.

The protections extended to unpaid interns in Oregon under the new law are essentially the same as for regular employees, so this would be an excellent time for Oregon employers to review their discrimination and retaliation policies. They should be sure that all protected classes and activities are addressed, and modify the policies to add where necessary that unpaid interns are covered. Also, managers, supervisors and employees involved in company internship programs should receive training regarding the new law.

Finally, employers should, as a general matter, review their company internship programs to be sure that unpaid interns meet the definition for exempt status under the FLSA, and if not, are paid in accordance with Oregon minimum wage and overtime statutes.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or [email protected].

Don Stait is Special Counsel in Littler Mendelson’s Portland office. Contact him at 503-889-8874 or [email protected].