With all this talk about the federal minimum wage and debate about what it could do to local economies to have to pay that three part increase to the federal minimum wage over the next two years, employers in Alabama might be able to rest assured that their economy at the moment seems strong enough to withstand whatever is thrown at it, at least if you believe the Southern Business and Development magazine.
This magazine every year comes out with a Top 10 ranking of some of the best locations in the South to be an employer. It grades each community it looks at based on the leadership that the local community has, on some of the modes of transportation and resources that go into that transportation system, and on what kind of and how strong the emerging industries are in the area.
For the year 2007, Alabama came up strong in many of those judging categories. For instance, on the Southern Business and Development magazine’s Top 10 leaders in the South for the year 2007, the governor of Alabama, Gov. Bob Riley, made the list he scored big for being able to develop an important economic development agency that seems to have turned the state’s fortunes around.
The Southern Business and Development magazine also rated Birmingham as a top 10 place in the South to raise a family. Some of the reason for this include, according to the Southern Business and Development magazine, the fact that cost of living in Birmingham is reasonable for employees and business owners alike, and that the community is home to some of the South’s most dynamic industry employers in sectors such as publishing, finance, life sciences, and retail.
When it comes to the industries and employers of aerospace and aviation, in the South there are few better places to be then Mobile and Huntsville, according to the Southern Business and Development magazine, which put both of these Alabama communities in its top 10 lists for these industries. The reason is because Huntsville’s aviation employers get money from the military industrial complex via its Brookley Industrial Complex and its relationship with weapons contractor Northrup Grumman, as well as EADS North America, which has its tanker production facility in the area.
When it comes to some of top universities in the area producing tomorrow’s best employees and employers, Birmingham gets another mention from the Southern Business and Development magazine pages. This time, it’s the University of Alabama in Birmingham that made the list because of the excellent research bring done at the university there. The college is also a top health care incubation location, because of its strong relationships with the National Institutes of Health, as well as the employees that it produces for the biotech industry in the South and beyond.
When it comes to other emerging and exciting industries, put Huntsville back in the Southern Business and Development magazine’s spotlight. The community is known as well for its involvement in the tech sector, again with its Cummings Research Park. Believe it or not, Huntsville has the second highest proportion of scientists and engineers within its borders in the entire United States. Huntsville not only has the research park, it also has a special institute dedicated to the tech sector—the so called Hudson Alpha Institute for Biotechnology and Digium (don’t ask me what digium is).
Anyways, what does this have to do with the rest of you employers in the state? Well, if you are part of one of the communities or sectors that the Southern Business and Development magazine mentioned, kudos to you. If not, you can feel rest assured that your economy, powered by your fellow employers, is starting to make waves in the region and in the nation, and that’s good for everyone involved.
A little-publicized amendment has widespread effects on Alabama employee benefit plans.
The Mental Health Parity Act, or MHPA was recently extended through December 31, 2007, under a law signed by the president. The original MHPA bill was signed into law in 1996. It included a “sunset clause” that meant the bill expired on September 31, 2001. Since then, the law has been amended 5 times to extend the expiration date.
Under the mental health parity act, any group health insurance plan offered to employees in the nation must cover mental health treatments just as it does any other type of treatment, including medical treatments. Covered mental health treatments usually include visits to a licensed therapist, psychologist or psychiatrist.
Under the MHPA, most plans also cover periods in rehab for drug or alcohol dependency. Stays in mental hospitals or the mental health wing of a hospital for ailments as diverse as post-traumatic stress disorder, depression and schizophrenia are also covered.
Prior to the enactment of MHPA legislation, many group health insurance plans set a generous limit on medical treatment, of $200,000 per year or more. However, mental health plans were often given short shrift, with annual limits as low as $2,000 to $4,000. Under the current law, this is illegal. Any group health insurance plan must fund mental health treatments just as they do other medical treatments, including surgery.
Essentially, the MHPA requires parity between treatment levels for mental health and physical ailments. This reflects the changing attitude towards mental health in the US over the past 25 years. With millions of Americans on anti-depressants, seeking care for a mental problem doesn’t carry the stigma that it did in the past.
In the past, many workers who sought help for a problem, including alcohol or drug treatment, were caught in a bind. Often, their health insurance would pay $200,000 for a heart bypass operation, but not $20,000 for a month-long stay in rehab. Today, the situation is different, thanks to the MHPA.
In the state of Alabama, many employers have to pay for the tax system that supports employee unemployment insurance, though many nonprofit companies do not have to worry about the issue.
But for non-farm related businesses, the requirements for taxation for unemployment insurance go a little something like this. You are liable for those taxes if you have employed one or more workers on a day in 20 or more different weeks. Those 20 weeks don’t have to be consecutive and they don’t even have to happen in the same year.
Another requirement is that you have paid a salary or wages adding up to $1500 or more in any quarter of the business calendar year, either the past year or the current year. You don’t have to meet both requirements as an employer. If you just meet one of those requirements as a business, then you are liable for unemployment insurance taxation.
If you determine that you might be liable to pay taxation for your employees’ unemployment insurance, then it’s up to you to contact the proper Alabama authorities at the Status Unit in Montgomery. You have to fill out the proper application form, which helps you to open an Alabama Unemployment Tax account. You are supposed to get this form in as soon as you become eligible to pay the unemployment taxes.
The new tax account rate for the state of Alabama for employers who are new to the system is a rate of 2.7 percent for the first $8000 of wages for each and every employee. After that, all of your rates are then determined by so called experience rating, which means that they base the rates on their experience with you as an employer and how many of your employees have gone on the unemployment dole.
While Alabama workers are given several holidays off, employers are not required by law to pay holiday pay if the employer chooses to close on a holiday. Holiday pay is solely at the discretion of the employer, though many employers compensate their workers for some of the major holidays such as Christmas and Thanksgiving.
If the employee works on a day deemed a holiday, the employer is only required to pay the employee a regular wage, and an extra amount is not required in consideration of the holiday such as holiday pay or time-and-a-half such as in some other states. There are also considerations made for the day on which the holiday falls so that employees will still have the day off if the holiday falls on a weekend. For instance, if the holiday falls on a Sunday, the employee will get the following Monday off. Likewise, the previous Friday in lieu of the Saturday holiday day will be considered the day off observed as the holiday.
Alabama counts several days as holidays for the purpose of wages including New Year’s Day, the Fourth of July, Confederate Memorial Day, Memorial Day, Labor Day, Columbus Day and Fraternal Day, Veterans’ Day, American Indian Heritage Day, and the day designated by the Governor for public thanksgiving, as well as several American presidents’ and notable citizens’ birthdays such as Martin Luther King, Jr., Robert E. Lee, George Washington, Thomas Jefferson, and Jefferson Davis. In addition, Mobile and Baldwin Counties celebrate Mardi gras as a holiday and all state offices are closed in observance.
The State of Alabama Department of Labor, established in 1943, publishes several reports on subjects such as job related illness and injuries through its federal surveys, promotes the peaceful settlement of labor disputes and provides mediation services. The State of Alabama Department of Labor of works closely with federal agencies including the U.S. Department of Labor.
In November 2000 the Federal government passed the Gramm-Leach Bliley Act – 15 U.S.C. §§ 6801-6827 (GLBA) that set the precedence for customer privacy. This bill covered Privacy Rights for disclosure of personal information from companies, producers and other persons and entities licensed under each state’s insurance law and included all licensees, health insurers and HMOs because they are considered “financial institutions” under Title V of the GLBA. However, the State of Alabama does not license TPA’s so the requirements do not directly apply to a TPA but only indirectly because the requirements are applicable to the insurer and only by written permission. In addition, workers’ compensation plans are not subject to Alabama State’s Insurance Commissioner’s regulation but is subject to Federal law.
The GLBA permits each state to develop its own compliance regulations. Alabama adopted the NAIC model with minor changes that included a “simplified” Privacy Notice that applied to most agencies in the state and allowed a very brief Privacy Notice to be used.
The Privacy Notices establishes how agencies can collect customer’s information. For example, they can collect information from claim forms, enrollment forms, beneficiary designation/assignment forms and other forms used for administering coverage or paying claims. The type of information they collect includes Social Security number, address, date of birth, phone number, marital status, gender, dependent information, bank account information and employment information. In addition, the notice includes to whom they may disclose the information. Any health information is not shared unless it is allowed under applicable law or if the customer approves the sharing of this information.
The GLBA has set the standard when it comes to customer privacy. All Privacy Notices must be accurate, written clearly and understandably so that customers can understand what information is being collected and how agencies use their information. These notices need to be given to new customers as well as sent out annually to existing customers.