Benefits Bryan Cave

Main Content

Employer CCPA FAQs #4: What information is not “Personal Information” under the CCPA?

This post is part of our series of FAQs examining the California Consumer Privacy Act (“CCPA”)  that should help employers with operations in California to determine if they are required to comply with the CCPA and if so, what steps their HR professionals and IT departments should take to be in compliance.

By way of background, the CCPA is a new privacy law that will go into effect in early 2020. Because the CCPA refers to “consumers” many HR professionals do not realize that the CCPA, as currently enacted, also applies to data collected about California-based employees. Please see our recent blog post for a summary of which employers will be subject to the CCPA and the key requirements of the law.

Although the law will not be in effect until next year, employers who must comply should be addressing compliance obligations now.  For U.S. employers who have not had to comply with the European Union’s General Data Protection Regulation (“GDPR”), the requirements of the CCPA will likely require a new analysis of the treatment of employee-data and updated or new data policies. Employers who are required to comply with the GDPR will likely already be familiar with many of the requirements of the CCPA, and a key area of interest is the degree to which the CCPA aligns with GDPR for purposes of implementing CCPA compliant practices for their California-based employees.

BCLP offers a complete compliance program for employers that includes a formal gap assessment and tailored policies, procedures, and protocols

Employer CCPA FAQs #3: As used in the CCPA, do the terms “personal data,” and “personal information” mean the same thing? 

In the coming weeks we will be releasing a series of FAQs examining the California Consumer Privacy Act (“CCPA”)  of particular importance to employers.  These FAQs should help employers determine if they are required to comply with the CCPA and if so, what steps their HR professionals and IT departments should take to be in compliance.

By way of background, employers with operations in California should be aware of the CCPA, a new privacy law that applies to data collected about California-based employees.   Because the CCPA refers to “consumers” many HR professionals don’t realize that the Act, as currently drafted, applies to data collected about California-based employees. Please see our recent blog post summarizing the CCPA for employers.

The CCPA will go into effect in early 2020, and employers who must comply should be addressing compliance obligations now.  For U.S. employers who have not had to comply with the GDPR, the requirements of the CCPA for California-based employees will likely require a new analysis of the treatment of employee-data and updated or new data policies.

For employers with European operations, one key area of interest is the degree to which the CCPA aligns with the European General Data Protection Regulation (“GDPR”).  Employers who are complying with the GDPR will likely already be familiar with many of the requirements of the CCPA – and with some assistance, should be able to bring their operations and policies into compliance with respect to California-based employees.

BCLP also offers a

Employer CCPA FAQs #2: What is “personal information” under the CCPA? 

In the coming weeks we will be releasing a series of FAQs examining the California Consumer Privacy Act (“CCPA”)  of particular importance to employers.  These FAQs should help employers determine if they are required to comply with the CCPA and if so, what steps their HR professionals and IT departments should take to be in compliance.

By way of background, employers with operations in California should be aware of the CCPA, a new privacy law that applies to data collected about California-based employees.   Because the CCPA refers to “consumers” many HR professionals don’t realize that the Act, as currently drafted, applies to data collected about California-based employees. Please see our recent blog post summarizing the CCPA for employers.

The CCPA will go into effect in early 2020, and employers who must comply should be addressing compliance obligations now.  For U.S. employers who have not had to comply with the GDPR, the requirements of the CCPA for California-based employees will likely require a new analysis of the treatment of employee-data and updated or new data policies.

For employers with European operations, one key area of interest is the degree to which the CCPA aligns with the European General Data Protection Regulation (“GDPR”).  Employers who are complying with the GDPR will likely already be familiar with many of the requirements of the CCPA – and with some assistance, should be able to bring their operations and policies into compliance with respect to California-based employees.

BCLP also offers a complete

Employer CCPA FAQs #1: Does the CCPA apply to employee data?

In the coming weeks we will be releasing a series of FAQs examining the California Consumer Privacy Act (“CCPA”)  of particular importance to employers.  These FAQs should help employers determine if they are required to comply with the CCPA and if so, what steps their HR professionals and IT departments should take to be in compliance.

By way of background, employers with operations in California should be aware of the CCPA, a new privacy law that applies to data collected about California-based employees.   Because the CCPA refers to “consumers” many HR professionals don’t realize that the Act, as currently drafted, applies to data collected about California-based employees. Please see our recent blog post summarizing the CCPA for employers.

The CCPA will go into effect in early 2020, and employers who must comply should be addressing compliance obligations now.  For U.S. employers who have not had to comply with the GDPR, the requirements of the CCPA for California-based employees will likely require a new analysis of the treatment of employee-data and updated or new data policies.

For employers with European operations, one key area of interest is the degree to which the CCPA aligns with the European General Data Protection Regulation (“GDPR”).  Employers who are complying with the GDPR will likely already be familiar with many of the requirements of the CCPA – and with some assistance, should be able to bring their operations and policies into compliance with respect to California-based employees.

BCLP also offers a

IRS Takes Step Towards De-Risking Retiree Lump Sum Windows

On March 6, 2019, the IRS announced that it will not amend the minimum required distribution regulations under Code section 401(a)(9) to expressly prohibit lump-sum window elections for retirees who are already receiving annuity payments under a defined benefit pension plan.  This practice has never been clearly permissible under existing RMD regulations. Nevertheless, some plan sponsors seeking to “de-risk” their pension liability received private letter rulings in the past permitting such action.  Then the IRS issued Notice 2015-49 announcing that it would propose amendments to the RMD regulations clarifying that lump sum windows for retirees are not be permitted.  Now the IRS has altered course on this issue again with Notice 2019-18.

Thoroughly confused?  Not surprising given the shifting positions of the IRS on this issue.

Existing Regulations

Existing regulations state that once annuity payments have commenced over a period of time, the period may only be changed in accordance with certain exceptions enumerated in Treas. Reg. 1.401(a)(9)-6, Q&A-13.  One enumerated exception is for annuity payment increases described in Q&A-14.  The regulations under Q&A-14 provide that annuity payments may increase to allow a beneficiary to convert the survivor portion of a joint and survivor annuity into a single-sum distribution upon the employee’s death.  They do not expressly recognize a similar right to convert an annuity into to a lump sum during the employee’s lifetime.  They do, however, permit the payment of “increased benefits that result from a plan amendment.”  Plan sponsors interested

Meet the CCPA: New Privacy Rules for California Employees

Employers with operations in California should be aware of the California Consumer Privacy Act (“CCPA”), a new privacy law that applies to data collected about California-based employees.   HR professionals should be aware that, although the CCPA refers to “consumers,” as currently drafted the CCPA’s definition of a “consumer” will apply to California-based employees.

Which employers will have to comply with the CCPA?

Employers with employees in California will need to comply with the CCPA if their business falls into one of the following three categories:

1. Their business buys, sells, or shares the “personal information” of 50,000 “consumers” or “devices”;

2. Their business has gross revenue greater than $25 million; or

3. Their business derives 50% or more of its annual revenue from sharing personal information.

What are the key implications of having to comply with the CCPA?

The Employers who have to comply with the CCPA will be subject to the CCPA’s:

1. Expansive definition of “personal information”;

2. New notice requirements for California-based employees, which notices describe the employer’s collection of and use and disclosure of personal information;

3. New data privacy rights for California-based employees, including the right to access, delete, and opt out of the “sale” of personal information;

4. Special rules for the collection and use of personal information of minors;

5. Requirement to implement appropriate and reasonable security practices and procedures;

6. Enforcement

There’s No Such Thing as a Free Lunch…But There are Free Snacks

Something to gnaw on during your lunch hour today (sorry, we couldn’t resist):  the IRS recently released TAM 201903017, which ruled that free employee meals provided by an employer were includible in its employees’ taxable income – and therefore subject to employment taxes.

Section 119(a)(1) of the Code excludes the value of meals provided to an employee by an employer if the meals are furnished on the employer’s business premises “for the convenience of the employer.”  The “convenience” test can be met if the employer has a substantial noncompensatory business reason for providing the free meals, such as that the employee must be available for emergency calls or that there are no nearby alternatives to secure a meal within the employee’s meal period.  Under Section 119(b)(4) of the Code, if more than 50% of an employer’s employees on its premises receive meals that satisfy the “convenience” test, then all meals provided by the employer are deemed to be for its convenience and are therefore excluded as a taxable fringe benefit to its employees.  Section 3121(a)(19) of the Code excludes the value of any such meals from employee wages for purposes of employment tax withholding if it is “reasonable to believe” that the meals are excludable under Section 119.

In TAM 201903017, the employer-taxpayer (which, although redacted, appears to be a large technology corporation) did not include the value of employer-provided meals and snacks in its employees’ income, nor did it withhold and pay the related amount of

ISS Updates its U.S. Compensation and Equity Compensation Plan Policies for 2019

In December 2018, Institutional Shareholder Services (“ISS”) published updates to its FAQs for its U.S. Compensation Policies and its policies related to U.S. Equity Compensation Plans with respect to annual meetings occurring on or after February 1, 2019.  While ISS did not make major changes for 2019, reporting companies should be aware of the following key updates.

  • The passing scores for all U.S. Equity Plan Scorecard (“EPSC”) models remain the same as in effect for the 2018 proxy season. However, ISS made the following notable changes and clarifications to EPSC’s scoring model:
    • Full points will be awarded for the change in control (CIC) vesting factor if the plan discloses with specificity the CIC vesting treatment for both time- and performance-based awards. If a plan is silent on CIC vesting treatment or provides for discretionary vesting, then no points will be awarded for this factor.
    • Weighting on the plan duration factor has been increased to encourage plan resubmissions more often than listing exchanges require (and following the repeal of Section 162(m), which required periodic stockholder reapproval). To receive full points for plan duration, the proposed share reserve should last five to six years or less (based on the issuer’s 3-year annual average burn rate).
    • Equity plan amendments that involve removal of general references to Section 162(m) qualification (including references to approved metrics for use in performance plan-based awards) will be viewed as administrative and neutral. However, the removal of individual award limits in

Glass Lewis Updates Proxy Voting Guidelines for 2019

Glass Lewis Updates Proxy Voting Guidelines for 2019

November 30, 2018

Authored by: Denise Erwin and Lisa Van Fleet

On October 24th, Glass Lewis published its updated proxy voting guidelines for 2019.  Some key compensation-related changes for reporting companies to keep in mind are highlighted below:

Excise Tax Gross-ups

When any new excise tax gross-ups are provided for in executive employment agreements, Glass Lewis may recommend against members of the compensation committee, particularly where a company previously committed not to provide gross-ups in the future.  Glass Lewis is particularly opposed to gross-ups related to excise taxes on excess parachute payments.  New gross-up provisions with respect to these excise taxes may lead to negative recommendations for a company’s say-on-pay proposal.

Contractual Payments and Arrangements

The new guidelines clarify the terms that may contribute to a negative voting recommendation on say-on-pay proposals.  When evaluating sign-on and severance arrangements, Glass Lewis will consider the size and design of any payments as well as U.S. market practice.  Glass Lewis will consider the executive’s regular target compensation level, the sums paid to other executives and, in special cases, whether the sums paid to departing executives were appropriate given the circumstances of the executive’s departure.  Excessive sign-on awards and multi-year guaranteed bonuses may result in negative recommendations.   In addition, key man clauses, board continuity conditions and excessively broad change in control triggers are also terms that could result in a negative recommendation.

Executive Compensation Disclosure for Smaller Reporting Companies

When assessing the performance of compensation committees, Glass Lewis indicates that it will consider the impact of materially decreased CD&A disclosure for smaller reporting companies when

2019 Qualified Plan Limits Released

The Internal Revenue Service released the 2019 dollar limits for retirement plans, as adjusted under Code Section 415(d). We have summarized the new limits (along with the limits from the last few years) in the chart below.

Type of Limitation

2019 2018 2017 2016 2015 Elective Deferrals (401(k), 403(b), 457(b)(2) and 457(c)(1)) $19,000 $18,500 $18,000 $18,000 $18,000 Section 414(v) Catch-Up Deferrals to 401(k), 403(b), 457(b), or SARSEP Plans (457(b)(3) and 402(g) provide separate catch-up rules to be considered as appropriate) $6,000 $6,000 $6,000 $6,000 $6,000 SIMPLE Salary Deferral $13,000 $12,500 $12,500 $12,500 $12,500 SIMPLE 401(k) or regular SIMPLE plans, Catch-Up Deferrals $3,000 $3,000 $3,000 $3,000 $3,000 415 limit for Defined Benefit Plans $225,000 $220,000 $215,000 $210,000 $210,000 415 limit for Defined Contribution Plans $56,000 $55,000 $54,000 $53,000 $53,000 Annual Compensation Limit $280,000 $275,000 $270,000 $265,000 $265,000 Annual Compensation Limit for Grandfathered Participants in Governmental Plans Which Followed 401(a)(17) Limits (With Indexing) on July 1, 1993  

$415,000  

$405,000  

$400,000  

$395,000  

$395,000 Highly Compensated Employee 414(q)(1)(B) $125,000 $120,000 $120,000 $120,000 $120,000 Key employee in top heavy plan (officer) $180,000 $175,000 $175,000 $170,000 $170,000 Tax Credit ESOP Maximum balance $1,130,000 $1,105,000 $1,080,000 $1,070,000 $1,070,000 Amount for Lengthening of 5-Year ESOP Period $225,000 $220,000 $215,000 $210,000 $210,000 Taxable Wage Base $132,900 $128,400 $127,200 $118,500 $118,500 IRAs for individuals 49 and below $6,000 $5,500 $5,500 $5,500 $5,500 IRAs for individuals 50 and above $7,000 $6,500 $6,500 $6,500 $6,500 FICA Tax for employees and employers 7.65% 7.65%

The attorneys of Bryan Cave Leighton Paisner make this site available to you only for the educational purposes of imparting general information and a general understanding of the law. This site does not offer specific legal advice. Your use of this site does not create an attorney-client relationship between you and Bryan Cave LLP or any of its attorneys. Do not use this site as a substitute for specific legal advice from a licensed attorney. Much of the information on this site is based upon preliminary discussions in the absence of definitive advice or policy statements and therefore may change as soon as more definitive advice is available. Please review our full disclaimer.