Voices

Helping your small business clients through 2019’s top regulatory issues

While it may seem as if 2019 has just begun, the year is already well underway, bringing with it a new class of legislators and a set of issues — both new and old — that will be a focus at the federal, state and local levels.

As a result, it can be challenging for your small business clients to keep up with the constantly evolving regulatory landscape as they’re focused on running a profitable business and staying ahead of the competition. Therefore, it’s imperative for you to help them understand current and pending laws.

One of the top regulatory issues this year is sexual harassment prevention. The #MeToo movement resulted in an increase in workplace sexual harassment prevention enforcement and legislation across the country in 2018 and is expected to continue in 2019. The Equal Employment Opportunity Commission reported significantly increased activity around sexual discrimination during the past fiscal year, launching 50 percent more sexual harassment lawsuits than the previous year. State and city legislatures, including California, New York State, Delaware and New York City, responded with the passage of new legislation and regulations including provisions to implement or expand workplace sexual harassment prevention training requirements.

Business owners should also pay attention to paid leave regulation. Currently, more than 40 state and local jurisdictions have implemented paid leave laws and several more are scheduled to implement leave policies in early 2019. Although paid sick leave laws are more prevalent, paid family leave laws are generally more onerous for employers. Many family leave laws are funded by employee and/or employer contributions and might also require the periodic reporting of several elements including payroll deductions, employee hours worked and employee wages.

As it has for the past several years, health care remains a complex, but important, aspect of any business’s regulatory compliance. Recent changes to federal regulations and guidance which may affect health insurance markets and relate to Association Health Plan (AHPs), Short-term Limited Duration Insurance (STLDI), Health Reimbursement Arrangements (HRAs) and Section 1332 state innovation waivers (which allow alternative solutions as long as they provide health coverage that delivers at least the same level of protections guaranteed under the ACA) might lead to changes affecting employers’ support of health insurance. These changes, combined with the removal of the federal individual mandate penalty, have encouraged states again to reexamine how they will support their health insurance markets in response to the new federal rules.

Federal support for retirement savings will remain a priority this year. In August 2018, President Trump issued an executive order directing the Departments of Labor and Treasury to propose regulations that ease the burdens small businesses face in offering retirement savings plans. Prospects for successful new legislation, which will include components of prior proposals, are promising, potentially enhanced by Rep. Richard Neal, D-Mass., as chairman of the House Ways and Means Committee, who intends to make retirement legislation a priority.

Faster payments, including immediate payments for gig workers, will continue to dominate the payments landscape in 2019. As business owners make decisions on how and when their company will participate in the faster payments arena, fraud prevention should be top of mind to ensure payments are safe and secure in a 24/7/365 environment.

As Americans become increasingly focused on how well the companies they deal with protect their sensitive data, many states are enacting or broadening privacy regulations, with California’s new rule, which takes effect next year, perhaps the most prominent. In addition to the usual requirements for a strong data security process, some states are requiring that consumers have the right to know what data companies are collecting on them and the ability to opt-out of that data being sold or distributed without their consent. Many business groups are calling for a federal privacy regulatory standard to avoid the need for alignment with differing state requirements.

Keeping up with regulations is a challenge for today’s small business owners. Armed with knowledge of business regulation, you can provide your clients with the information and resources they need to make the best decisions for their businesses.