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Last Week in Payroll: Athletes and Equal Pay

Christopher Wood, CPP  

Christopher Wood, CPP  

A blog of some of the prior week’s more important federal, state and local payroll stories. This week’s focus is on athletes and equal pay as the U.S. Women’s Soccer Team appeals a court ruling and the Equal Pay Act is reintroduced in Congress.

On August 8, 2021, the Summer Olympics in Tokyo (Games of the XXXII Olympiad) will conclude with the closing ceremonies on Sunday evening.  These games were delayed a year due to the COVID-19 pandemic. Despite the pandemic and lack of fans in the stands, I have been watching all of the athletes compete with similar excitement and joy as I did with prior Olympic games.   

Of particular excitement so far for me was watching Suni Lee’s gold medal win in the women’s gymnastics all-around, Caeleb Dressel’s gold medal win in the men’s 100-meter freestyle swim, Carissa Moore’s gold medal win in the women’s surfing competition, and William Shaner’s gold medal win in the men’s 10m air rifle event.  I’m sure there will be more excitement to come before the games finish up at the end of the week. 

One of the most successful U.S. teams is women’s soccer.  They got off to a tough start against Sweden’s team but came back and got all the way to the semifinals where they lost a close game to Canada, which put the team out of contention for a gold medal. Team USA will take on Australia for the bronze medal on Thursday.  

Athletes and Equal Pay

The women’s soccer team has also made headlines recently when the team appealed a court case to overturn a 2020 decision against their equal pay lawsuit on July 23, 2021, the day the Tokyo Olympics got underway. In May of 2020, a judge ruled that there was no basis to prove the players’ claims that the U.S. Soccer Federation financially discriminated against the women based on their gender. And in the U.S. Congress, the Equal Pay for Team USA Act of 2021 was reintroduced in the Senate a week or so before the games started. The legislation was first introduced in 2019.  

Last year, the federal government had collected pay data from employers with a temporary additional report collected by the Equal Employment Opportunity Commission (EEOC) for the 2017 and 2018 calendar years. The EEOC announced analysis of this pay data by the National Academy of Sciences, Engineering, and Medicine’s Committee on National Statistics (CNSTAT) in July of 2020 with an anticipated completion date of December 31, 2021. This temporary data collection was in addition to the annual EEO-1 Component 1 report many employers must file that includes demographic workforce data (i.e., race/ethnicity, sex and job categories). 

It will be interesting to see the results of this study.  As will it be interesting to follow the Equal Pay for Team USA Act and where the women’s soccer team case appeal goes.  Perhaps we will all learn a bit more from these actions.   

In the meantime, I am looking forward to watching the men’s and women’s marathon final taking place this Friday and will be paying particular attention to Abdihakem Abdirahman in the men’s competition. He’s a 44-year-old, five-time team U.S. Olympian who is currently the oldest U.S. runner to make the team. I’m a 45-year-old editor who has run four marathons (at a snail’s pace, mind you) so I’m shamelessly rooting for age over youth to win for this race.   

Now let’s go over some of the more important payroll stories from the past week.    

Federal News 

IRS FAQs clarify paid sick and family leave credits related to vaccines. The IRS has updated its lengthy list of FAQs on paid sick and family leave tax credits under the American Rescue Plan Act (ARPA) relating to COVID-19 vaccines. These revised FAQs make clear this includes leave taken by employees to care for certain individuals to obtain vaccines relating to COVID-19 or to recover from vaccines related to COVID-19. 

IRS posts Form 941-X draft. The IRS has posted a draft version of Form 941-XAdjusted Employer’s Quarterly Federal Tax Return or Claim for Refund, that takes into account the COVID-19 tax credits and the new credit for COBRA premium assistance payments from the American Rescue Plan Act (ARPA). Form 941 has been revised several times since the start of the pandemic due to COVID-19 tax credits available to employers. Form 941-X also must be revised so that employers needing to make adjustments can do so. The latest version of Form 941-X is from October 2020.  The draft form is now five pages, instead of four.  

Another round of guidance for COBRA premium credit. The IRS has issued a second round of guidance on the COBRA premium credit from the American Rescue Plan Act (ARPA) provision. In May of 2021, the IRS issued a notice that discussed a number of issues regarding the ARPA COBRA provision.  

DOL to rescind 2020 joint employer rule. The U.S. Department of Labor has issued a final rule that rescinds a 2020 rule on joint employment. The Trump Administration’s DOL issued this prior rule in January of 2020 that revised and clarified the responsibilities or employers and joint employers in joint employer arrangements. The rule took effect in March of 2020 but part of the rule was struck down by a federal district court in September of 2020. The Biden Administration’s DOL took steps to rescind the 2020 rule entirely.  The final rule rescinding the 2020 joint employer rule takes effect on September 28, 2021. 

State and Local News 

Arizona

Return to work guidance for employers and employees. The Arizona Department of Economic Security has provided return to work guidance for employers and employees. Employers do not need to report to the DES that their employees are returning to work. There is also a return to work bonus for eligible individuals or up to $2,000 until September 6, 2021. 

Colorado

Pandemic-related unemployment claim decisions being sent through early August 2021. The Colorado Department of Labor and Employment is sending pandemic-related unemployment claim decisions through early August 2021.  These decisions are being issued to properly adjust charging for employer accounts prior to the premium rate calculation for 2022. The CDLE expects this to positively impact an employer’s unemployment tax rate, however, the state will be moving to the highest unemployment tax rate chart as a result of the unemployment trust fund balance. 

Maine

Mandatory e-filing of wage statements proposed. Maine is proposing a new rule where e-filing wage and tax statements would become mandatory if the federal information returns were also required to be filed electronically. The rule is open for public comment until August 13, 2021. 

New Hampshire

Minimum wage for tipped workers adjusted. New Hampshire legislation ties the state minimum wage for tipped workers to the federal rate for tipped workers.  As such, employees who regularly receive more than $30 a month in tips must be paid a base rate of at least $3.27 per hour. Prior to the legislation, the base rate was 45% of the relevant minimum wage. What this means is that if the federal minimum wage ever increases, New Hampshire’s tipped minimum wage rate will remain at $3.27 per hour. But, if the federal tipped minimum wage rate increases than the state’s tipped rate must also increase. 

North Carolina

Wage and hour laws modified. North Carolina legislation changes some state wage and hour laws and adds new employer requirements regarding providing written notice of wage rate, advising employees about any decrease in pay and paying final wages. 

Oregon

Adjustment of calculation and payment of unemployment taxes. Oregon legislation changes the requirements for the calculation and payment of unemployment taxes for employers by keeping the tax rate schedule from 2020 in place for 2022, 2023 and 2024.    

Virginia

Plans to replenish unemployment fund with COVID-19 money to prevent rate increases. Virginia Governor Northam announced a plan to replenish the state’s unemployment trust fund with $862 million in federal funds provided by the American Rescue Plan Act (ARPA) to prevent unemployment tax rate increases associated with layoffs related to the COVID-19 pandemic. 

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