Government Funding Bill Signed into Law, Includes SHRM-Supported Delay of ACA Excise Tax

Dec 22, 2015

Last Friday, the Congress passed and President Barack Obama signed into law a $1.8 trillion package of spending bills and tax breaks. The omnibus bill combines two comprehensive legislative proposals—the Protecting Americans from Tax Hikes Act (see related article) and the Consolidated Appropriations Act. Both contain several public-policy provisions significant to the HR profession and a number of policy issues advocated by SHRM and the SHRM A-Team.

Below are summaries of key provisions of the funding legislation addressing health care, along with labor and immigration policy:

Health Care

A two-year delay of the implementation of the Affordable Care Act’s (ACA’s) 40 percent excise tax (“Cadillac tax”) on high-value, employer-sponsored health care benefits until 2020SHRM has long advocated for full repeal of the excise tax and applauds the two-year delay. The delay will provide much needed relief to employers and employees, and SHRM will continue to support and encourage Congress to fully repeal the excise tax.


Prior to last week’s action, SHRM sent a letter to representatives and senators encouraging their support of a two-year delay in the excise tax. In June of this year 50 SHRM-affiliated state councils and over 190 chapters signed onto a SHRM letter urging the U.S. House of Representatives to take action and repeal the excise tax. Most recently, 400 SHRM members (some pictured above) advocated in support of legislative proposals to repeal the excise tax during the SHRM Volunteer Leaders’ Summit Hill Day on Nov. 19. SHRM members also sent over 400 individual letters to their respective lawmakers in support of House and Senate proposals to repeal the excise tax. To further demonstrate leadership on this issue, SHRM is a leader of the National Coalition on Benefits and has been involved in direct lobbying and member advocacy efforts in support of legislative proposals to repeal the excise tax.

Labor Policy

In terms of labor policy, the omnibus funding bill was a mixed bag. The bill included some provisions helpful to HR professionals and remained silent on other priorities that would have benefited SHRM members.

Maintaining the Office of Disability Employment Policy (ODEP) Separate from the Employment and Training Administration (ETA)—A provision had been included in an earlier budget bill which would have folded ODEP into the ETA. ODEP has a history of effectively partnering with employers, including SHRM members, to integrate people with disabilities into the workplace, and any effort to collapse the office into ETA would have affected the mission and autonomy of ODEP. SHRM had advocated maintaining ODEP as a separate agency within the Department of Labor.

Omitting a Joint-Employer Policy “Rider”—SHRM was extremely disappointed that the final agreement failed to include a rider blocking the National Labor Relations Board (NLRB) from changing the joint-employer standard that has been well-recognized and understood by employers and employees for over 30 years. As previously reported, SHRM opposes the new joint-employer standard adopted by the NLRB and remains committed to working with Senate and House leaders in 2016 to advance legislation that blocks the Board from using this revised standard.

Barring the Fair Pay and Safe Workplaces' Office of Labor Compliance—A recent executive order issued by President Obama called for the creation of a new Office of Labor Compliance to help administer the President's Fair Pay and Safe Workplaces initiave relating to federal contractors' compliance with various labor statutes. The legislation contains a provision denying the administration’s request for funds for a new Office of Labor Compliance. SHRM has expressed significant concerns with this executive order including the establishment of the new Office of Labor Compliance in comments earlier submitted to the U.S. Department of Labor and the Federal Acquisition Regulatory (FAR) Council. While this language sends a strong message about congressional frustration with the order, DOL will likely still be able to implement the rule.

Prohibiting the NLRB from Issuing Regulations on Electronic Voting—Lastly, as seen in previous funding bills, the bill continues a provision preventing the NLRB from issuing any new administrative directives or regulations that would provide employees any means of voting electronically in an election to determine a representative for the purposes of collective bargaining.

Immigration Policy

On the immigration front, the funding bill had a series of provisions dealing with the E-Verify program and visas. Below is a snapshot of issues of interest to HR practitioners:

Extending the E-Verify Program to Sept. 30, 2016—SHRM welcomes the inclusion of language in the bill that reauthorizes E-Verify for another year, but remains concerned that the current E-Verify program lacks sufficient security features to protect employers from persons using fraudulent identities in seeking employment. E-Verify continues to rely on paper documentation that is susceptible to theft, forgery and alteration, and that cannot be verified for authenticity. SHRM and its affiliate, the Council for Global Immigration, will work with Congress on future legislative proposals to strengthen the E-Verify program by providing employers with modern tools that will help combat identity theft and, ultimately, one reliable, accurate and easily accessible federal employment verification system.

Extending the H-1B and L-1 50/50 Fee—This provision affects employers with 50 or more employees and more than 50 percent H-1B and L-1 nonimmigrant workers (50/50 employers). Effective immediately, the bill adds in a new $4,000 H-1B fee and $4,500 L-1 fee on 50/50 employers for initial, change of status and extension filings. The previous fee lapsed on Sept. 30, 2015, allowing 50/50 employers not to file a fee for almost two and a half months.

Under this bill, the fee is extended for 10 years until Sept. 30, 2025. The fee is both an increase over previous amounts and an expansion to cover extension petitions. The fees will go to cover Sept. 11 first responders and biometric entry and exit efforts. The impact of the fee remains to be seen, but 50/50 employers may, as a result, choose to file fewer petitions toward next year’s H-1B cap.

Extending H-2B Cap Relief for Returning Workers; New Wage Requirements—The bill revives a cap exemption for H-2B “returning workers.” A foreign national who was counted against the 66,000 H-2B cap in FY 2013, 2014 or 2015 would not be subject to the cap in FY 2016. A similar cap exemption was in effect in the past, but expired at the end of FY 2007.

H-2B employers would be required to pay workers a wage that is higher than (1) the actual wage the employer pays to other employees with similar experience and qualifications in the position and geographic area where the H-2B worker will be employed; or (2) the prevailing wage for the occupation in the geographic area of employment. Under current law, H-2B employers must pay the higher of the DOL-determined prevailing wage or the applicable federal, state or local minimum wage.

Employers in the seafood industry would be given greater flexibility to determine the employment start dates of foreign workers with an approved H-2B petition, but would be required to conduct additional recruitment and offer positions to U.S. applicants if the employer brings approved H-2B employees into the U.S. 90 to 120 days after the employment start date specified in the petition.

Additional Visa Waiver Program (VWP) Security Measures—This provision affects all travelers to the United States from VWP countries. Specifically, the bill includes the Visa Waiver Program Improvement and Terrorist Travel Prevention Act of 2015 (H.R. 158). Of particular interest, an executive, contractor or other key professional would have to apply for a visa only if he or she is a national of Iraq or Syria, or if he or she has traveled to Iraq, Iran, Sudan or Syria since March 1, 2011. The bill provides an exemption for VWP travelers who were present in any of these countries in order to perform military service in the armed forces of a VWP country or in order to carry out official duties as a full-time employee of the government of a VWP country. The Department of Homeland Security may also waive the provision if it determines that such a waiver is in the law enforcement or national security interests of the United States.


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