IRS Announces Raises to HSA/HDHP Dollar Limits for 2018

May 17, 2017 | Leave a Comment

IRS Announces Raises to HSA/HDHP Dollar Limits for 2018

Dollar limits for Health Savings Accounts (HSAs) and High Deductible Health Plans (HDHPs) will be increased for plan years beginning after Jan. 1, 2018, to account for inflation, as announced by the Internal Revenue Service this month.

The following chart outlines the changes in contribution limits to occur in 2018:

Changes to 2018 HSA and HDHP Limits

HSA Contribution Changes

The HSA contribution limit will increase $50 for self-only plans and $150 for family plans, to a total limit of $3,450 and $6,900 respectively. HSA catch-up contributions for people age 55 and older are not subject to increases to account for inflation and will remain the same.

HDHP Eligibility Changes

To qualify as an HDHP in 2018, a plan will require a minimum deductible of $1,350 for self-only plans, up $50 from the 2017 minimum. The minimum deductible for family HDHP plans will increase $100 from 2017 to $2,700 in 2018.

Out-of-pocket maximums have also increased for the 2018 plan year. Maximum expenses for HDHP plans will be $6,650 for self-only and $13,300 for family, up $100 and $200 from 2017 respectively.

Next Steps

Employers sponsoring HDHPs may need to make changes to plan designs for 2018 and update any enrollment materials to reflect these new HSA limits.

Please contact your Cornerstone Consultant with any questions about the IRS’ announcement to raise HSA/HDHP dollar limits for 2018.

Posted in Benefits, Blog, Legislative Alerts | Tagged  , ,

Updates on Replace and Repeal of the ACA: American Health Care Act Sent to the Senate

May 10, 2017 | Leave a Comment

AHCA sent to senate

On May 4, the U.S. House of Representatives voted to repeal the 2010 Affordable Care Act and replace it with the American Health Care Act. The new bill is now being deliberated by the Senate.

Although there is much media coverage surrounding the bill, all ACA requirements will remain in effect until the AHCA is passed by the Senate and signed into law by President Trump.

As the Senate considers the AHCA as it has been passed by the House of Representatives, it may pass or dismiss the bill in its entirety – or it could change the legislation so much that it passes a drastically different bill.

If the House and the Senate do pass separate versions of the bill, a committee will be formed to compromise and draft a hybrid of both bills. If a committee produces a hybrid bill, the Constitution requires that both the House and the Senate pass identical versions of the bill before it can be signed into law by President Trump.

This process may take weeks or months.

If it was signed into law as it stands now, the AHCA would make the following revisions to the ACA:

How will this affect your employer health plan?

  • Employer shared responsibility rules—

The ACA’s employer shared responsibility rules require applicable large employers (employers with 50 or more full-time employees) to offer an acceptable minimum level of health coverage to full-time employees and their dependents – or pay a penalty. Under the new bill, this provision will be canceled. However, Form 1094 & 1095 reporting requirements will remain.

  • Federal subsidies for small businesses—

In 2020, the ACHA will repeal the ACA’s small business tax credit.

  • Relief from Cadillac tax—

The start date of the excise tax on high-cost employer-sponsored health plans will be pushed back, so the tax will begin after Dec. 31, 2025.

How will this affect your employees?

  • Increases in HSA contribution limits—

The ACHA will increase the maximum Health Savings Account contribution limit beginning in 2018. Where the maximum out-of-pocket limit allowed by law is currently $3,400 for self-only and $6,750 for family coverage, the ACHA will increase those maximums to $6,550 and $13,1000 respectively.

  • HSAs covering prior expenses—

Under the new bill, HSA funds will be able to pay for health care expenses incurred prior to the start date of the HSA (at least for funds occurring after the start date of a high deductible health plan, given the HSA is opened within 60 days from the start date of the HDHP).

  • OTC medications—

Tax-advantaged HSAs will be able to be used for a wider variety of over-the-counter health purchases.

  • FSA limits—

The ACHA will repeal the ACA’s clause imposing a limit to the funds an individual can contribute annually to a health Flexible Spending Account.

How will this affect the health care exchange?

  • Individual mandate—

The ACA requires most individuals to obtain acceptable health insurance coverage for themselves and dependents or pay a penalty. Under the AHCA, this mandate will be repealed. Instead, the ACHA will impose a 30 percent penalty onto the premiums of small groups and individuals that have lapses in coverage.

  • Federal subsidies for individuals—

The ACA currently offers tax credits to low-income individuals who purchase health care coverage through the exchange. The AHCA will repeal these credits in 2020 and replace them with a monthly tax credit for all individuals.

Things that will not be changed by the ACHA include that coverage will still be allowed for children up to the age of 26 and there will be guaranteed availability and renewability of coverage.

Click here to read the American Health Care Act.

Posted in Benefits, Blog, Health Care Reform Info, Legislative Alerts | Tagged  , ,

St. Louis City Minimum Wage Increase to Go Into Effect Friday, May 5

May 04, 2017 | Leave a Comment

min wage increase

On May 4, 2017, St. Louis City announced the minimum wage increase will go into effect on Friday, May 5.

The minimum wage increase has a zero-day grace period and employers are expected to comply with the new regulations, which increase the city’s minimum wage to $10 per hour and $5 and hour for tipped employees.

The mayor’s office issued a statement indicating that failure to comply with the new law is “subject to prosecution in Municipal Court, and also may be subject to revocation of business licenses and occupancy permit.”

Per the city’s official website, the Department of Human Services has established a complaint center for employees to notify them of employer non-compliance and all complaints will be investigated within a 45 day period. The contact information for the city is or 314-589-6735.

The minimum wage will increase to $11.00 an hour on January 1, 2018.

Posted in Benefits, Legislative Alerts | Tagged  , ,

Guidelines for Accurate Job Descriptions

May 03, 2017 | Leave a Comment

accurate job descriptions

As a job description is often the introduction of prospective employees to your company, it is an essential piece of the hiring process. A well-written job description starts the employer-employee relationship off on the right foot.

If your descriptions haven’t been updated in a while, revisit them to check for accuracy and to determine if there is information that is omitted that may be preventing qualified candidates from applying to work for your organization.

What should be included?

An effective job description should provide two pieces of info: what the person is supposed to do and how they are supposed to do it.

The description itself should be broken out into four different sections:

  • Position overview: Always include is a brief description of the position. Think of what you would tell people about the job and your organization when you’re describing the position at a cocktail party. A quick overview will be enough to pique the interest of ideal candidates. Not including any information about the position may be a deterrent for those candidates to apply.
  • Essential functions of the job: This section covers what the person applying for the position is required to do day-in and day-out. Will the person be required to maintain regular attendance, communicate with people regularly, or speak in front of large audiences? As an employer, this listing the essential functions of the job can help protect you throughout the hiring process.

    For employers who are unsure if the job description meets the necessary duties, because other tasks may come up or it is a new position, placing “Other duties may be assigned” is perfectly acceptable.

  • Qualifications: Qualifications include education and experience required for the position, as well as any technical skills or certifications. This section should also let your applicants know if they need to pass a background test or a drug test as a part of your hiring process. If this job requires driving, note that a valid driver’s license and a reliable vehicle will be necessary.

    While most employers consider qualifications sections to include experience in the industry and other achievements, this section is also a place to list soft skills necessary for the job. “Works well in a team environment” and “able to work with a diverse group of people” may be necessary depending on your company’s culture.

  • Physical requirements: Do applicants need to bend, stoop, stand, or lift 20 pounds? This information is important to applicants when they apply to the job. Physical requirements may also include sitting at a desk for long periods of time in office environments. Some companies opt to keep this information in a separate file, accessible to applicants who reach out to the HR department.

There are several other sections that, while not required for an effective job description, may increase the potential candidates reaching out to apply.  These sections include: salary and FLSA status. These bonus sections may help qualified potential candidates through the application process.

Posted in Blog, Human Resources

Upcoming Circuit Court Decision to Determine St. Louis City Minimum Wage Increase

April 27, 2017 | Leave a Comment

ladder safety month (5)

On April 26, the Missouri Supreme Court affirmed St. Louis City’s 2015 minimum wage increase, which has been on hold since October 2015 due to a Circuit Court injunction.

The Missouri Supreme Court declined to reconsider its February 2017 ruling, which essentially allows the wage increase to move forward.  This decision leaves only the Circuit Court’s injunction as the last remaining barrier, and the City expects the Circuit Court to lift its injunction within the next week. Once this occurs, the minimum wage increase will take effect immediately.

The increase will raise the minimum wage hourly rate for city employees from $7.70 to $10 immediately and raise it again to $11 effective January 1, 2018.  The tipped employee rate will also increase to $5 per hour and then raise again to $5.50 on January 1.

We recommend that, if you have not yet done so, you prepare for this increase as it will affect all employees conducting work within the St. Louis City limits.

Posted in Benefits, Blog, Human Resources, Legislative Alerts

Distracted Driving Awareness Month

April 21, 2017 | Leave a Comment

Distracted Driving Smartphone

Reports of motor vehicle accidents involving a distracted driver are a daily occurrence. Distracted driving includes any activity that takes our attention away from driving – including multitasking while driving.

Calls, texting, or updating social media are all activities that greatly increase the risk of a crash, and all involve the use of a cell phone.

Both the National Highway Traffic Safety Administration and the National Safety Council believe that the actual number of reported crashes involving cell phones is much higher than what’s being reported.

The reality is that these accidents are preventable.

Driving requires the use of our visual, manual and cognitive resources, and safe driving requires our full attention to these resources.

When we’re engaged in a phone conversation, even hands-free, our brains become highly distracted, switching between visual, manual and cognitive tasks. This leads to “inattentive blindness”, since we fail to see visual clues in our driving environment.

Implement a Distracted Driving Policy

There are two steps to promote safety for your employees and limit their risk of accident while driving:

1. Implement a distracted driving policy at your company

2. Enforce it

An effective policy will apply to any employee operating a company vehicle or using a company-issued cell phone while operating a personal vehicle.

Click here for an example of an effective policy.

For more information, visit the National Safety Council at, or contact Cornerstone’s Loss Control Consultant Tom Scherrer at

Posted in Blog, Commercial, Risk management, Safety | Tagged  ,

Explained: Worker Classifications

April 13, 2017 | Leave a Comment

Employee Independent Contractor Classifications

The relationship between an employer and a worker is not always straightforward, but despite the possible discrepancies, it is extremely important to properly classify your workers. Tax implications vary depending on the type of worker, and the penalties for misclassifying a worker can be huge.

Generally, the Internal Revenue Service states you must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. However, a business owner is not responsible for any payroll taxes for independent contractors.

Many companies believe that they can choose whether to treat any given worker as an employee or independent contractor, but there are laws that determine whether a worker is an employee or an independent contractor.

Employee or Independent Contractor?

Before determining how to treat payments your company makes for services, you must categorize the business relationship that exists between your company and the person performing the services. The two largest categories of works are: employee or independent contractor.

Under common-law rules, anyone who performs services for you is your employee if you can control what will be done and how it will be done, even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed, such as when and where to do the work, what tools or equipment to use, where to purchase supplies and services, or what work must be performed by a specified individual.

In contrast, an independent contractor is an individual who performs services for you, but you control only the result of the work, not the means and methods of accomplishing the result.

People such as doctors, veterinarians, lawyers, accountants, contractors, subcontractors, public stenographers or auctioneers who are in an independent trade, business or profession in which they offer their services to the general public are generally independent contractors. However, whether these people are independent contractors or employees depends on the facts in each case. The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.

When determining if a worker is an employee or an independent contractor, a key factor to consider is whether the business retains the right to control the worker and the details of how the services are performed, regardless of whether the business actually exercises that right.

Here’s an example:

A plumber agrees to install plumbing in a new warehouse being built. Upon arriving at the warehouse, the plumber is given the building plans showing where the plumbing is to be installed, and advised that the plumbing must be completed within five days. This is direction of what is to be done, rather than how it is to be done and is consistent with independent contractor status.

Here’s another example that points more to an employee:

A plumber works out of the local plumbers’ union office. The warehouse general contractor tells the plumber what plumbing has to be done, gives specific instructions on installation, the tools to use, the type of pipe to use, and the order and sequence in which the plumbing is to be installed. These are specific instructions on how the work is to be performed and are consistent with employee status.

Types of Employees

  • Statutory Employee: If workers are independent contractors under the common law rules, such workers may nevertheless be treated as employees by statute (statutory employees) for certain employment tax purposes if they fall within any one of the following four categories and meet the three conditions described under Social Security and Medicare taxes, below.
    • A driver who distributes beverages (other than milk), meat, vegetable, fruit or bakery products; or who picks up and delivers laundry or dry cleaning, if the driver is your agent or is paid on commission.
    • A full-time life insurance sales agent whose principal business activity is selling life insurance or annuity contracts, or both, primarily for one life insurance company.
    • An individual who works at home on materials or goods that you supply and that must be returned to you or to a person of your name, if you also furnish specification for the work to be done.
    • A full-time traveling or city salesperson who works on your behalf and turns in orders to you from wholesalers, retailers, contractors, operators of hotels, restaurants or other similar establishments. The goods sold must be merchandise for resale or supplies for use in the buyer’s business operation. The work performed for you must be the salesperson’s principal business activity.
  • Social Security and Medicare taxes: Withhold Social Security and Medicare taxes from the wages of statutory employees if all three of the following conditions apply:
    • The service contract states or implies that substantially all the services are to be performed personally by them.
    • They do not have a substantial investment in the equipment and property used to perform the services (other than an investment in transportation facilities).
    • The services are performed on a continuing basis for the same payer.
  • Statutory Non-employee: There are generally two categories of statutory nonemployees: direct sellers and licensed real estate agents. They are treated as self-employed for all federal tax purposes, including income and employment taxes, if:
    • Substantially all payments for their services as direct sellers or real estate agents are directly related to sales or other output, rather than to the number of hours worked; and
    • Their services are performed under a written contract providing that they will not be treated as employees for federal tax purposes.
    • Part-time Workers: Businesses often need to hire workers on a seasonal or part-time basis. Whether you are getting paid or paying someone else, questions often arise over the tax treatment of payments for part-time and seasonal help. Part-time and seasonal employees are subject to the same tax withholding rules that apply to other employees.

If you have misclassified workers,

In certain circumstances, the IRS can relieve businesses of certain tax liabilities resulting from worker misclassification, but the business must meet specific requirements under the law.

The business must meet the following three requirements to receive relief:

  • Reporting consistency: the business must treat all workers in a similar position the same.
  • Substantive consistency: the business must file all required federal tax returns on a consistent basis.
  • Reasonable basis: The business must also have a reasonable basis for not treating the workers as employees.

Because not every worker can be easily classified in one category, it is important to take the entire working relationship into account. Consider the extent of the right to direct and control the services of the worker. And after you’ve classified the worker, document each of the factors used to determine how you came to your classification decision. Remember, the financial impact of misclassifying a worker can be substantial.

If you are unsure of the status of your workers or your responsibilities as an employer, call Cornerstone’s Director of TotalHR Bethany Holliday, PHR, SHRM-CP, for more information.


Posted in Blog, Human Resources

3 Ways to Seal the Deal With a Promising Candidate

April 06, 2017 | Leave a Comment

Avoid Rejected Job Offers

Rejected job offers happen. They’re almost inevitable in today’s competitive talent market.

However, if your team takes a closer look to analyze why your company is being rejected, you can implement best practices and minimize the risk of candidates joining another organization.

One of the key factors in preventing a job offer rejection is to determine why they are turned down in the first place.

Why are offers rejected?

According to a Careerbuilder survey of 400 professionals in the staffing industry, candidates decline a job offer most frequently because:

  • Candidate received another offer (39 percent).
  • Compensation and benefits are not in line with the candidate’s expectations (29 percent).
  • Candidate received a counteroffer from current company (10 percent).

A rejected offer for a key position could cost thousands of dollars in wasted time and expenses. To determine why your offers are being frequently rejected, consider the following best practices:

  • Ask new hires why they accepted.

On their first day on the job, ask new employees what elements of the offer were most compelling in their decision or almost caused them to reject the offer. Use their feedback to improve future offers.

  • Talk to applicants and new hires about your recruitment process.

The hiring process is the only aspect of a company that an applicant is exposed to prior to onboarding, so ensure you have a full understanding of her perception of the process and make adjustments when needed.

  • Take a critical look at your job offer letter.

Does the offer letter effectively describe the job and your company? Be sure to include all perks, benefits, differentiators, and incentives.

  • Send out post-reject surveys to applicants who declined a job offer.

Send out a survey to applicants who surprised you by declining your offer. Most candidates will initially mention salary as the reason for turning down your organization –but this may not be the case. Give it three to six months before reaching out. You should receive more truthful answers after a few months have passed.

Seal the Deal

Most applicants are concerned with open communication, growth and learning opportunities, flexibility, control of what they work on, control of who they work with, and when their work must take place.

While there are many variables that factor into an applicant’s decision to accept or reject an offer, there are also steps employers can take to ensure a candidate will accept an offer once it is presented:

  • Include the team in the interview

It makes sense for the direct supervisor to be one of the people interviewing a candidate. It gives both the manager and the candidate an opportunity to evaluate the potential relationship. Be sure to tell applicants what to expect in terms of the company culture and their role in a specific team or department.

  • Communicate frequently

Be timely when communicating with candidates. Even a quick email check-in with a potential employee will show professionalism, enthusiasm, and transparency in the hiring process and reflect well on your company. Lack of follow-up could show disinterest and cause a great candidate to move on.

  • Ask questions about the candidate’s wants and needs

Always assume the candidate has other offers on the table. The best way to ensure they weigh the offers in your favor is to be direct.

Throughout the interview process, ask questions that will uncover the individual’s wants and needs. Consider asking candidates to describe their dream jobs, in terms of location, culture, work environment, and communication styles. When you’ve made an offer, ask if there is anything your organization needs to change to ensure you’re the candidate’s first choice.

Though these suggestions are not fool-proof, they will help you limit the number of job offer rejections that come through your door. By gathering information and evaluating your current processes, you can improve your recruiting success and avoid rejected job offers.

Posted in Blog, Human Resources | Tagged  , , , ,

Hire to Fit Your Company Culture

March 30, 2017 | Leave a Comment

Hire to Fit Your company Culture

According to a survey of 2,100 CFOs by the Society for Human Resource Management, 41% of hiring managers estimate that hiring the wrong person costs the company thousands of dollars.

Bad hires may not get along with coworkers, require more time from management, and impact the morale of an entire team.

On the other hand, a good hire can increase retention and enhance employee performance. A good hire will fit with the company’s culture, increasing the team’s alignment with leadership and creating a positive work environment where all members share a common purpose and similar attitude.

How to find employees that fit

Companies looking to hire individuals that fit with their culture must first identify and understand it.

If an organization works virtually over an instant message platform, a qualified candidate who has no experience collaborating over team-based apps and prefers face-to-face meetings may not be the best fit. If a company has flexible work hours, where many employees work at different times or from home, a candidate who prefers structure and consistency may not be the right fit, either.

Before beginning the hiring process, identify the aspects of your company that make it unique. Ask employees how they would describe your company’s culture.

Once you identify what makes the organization successful, you will know what to look for during the selection process. This technique is also helpful in avoiding hiring discrimination allegations because you have defined the key characteristics of your culture, which help you logically and fairly justify your hiring decisions.

Hiring managers can ask applicants to fill out a questionnaire before scheduling a formal interview, giving employers the opportunity to ask questions about traits you cannot train someone how to do.

Think about your company’s values and the competencies current employees have that match with your culture. Ask behavior-related questions, such as examples of situations in which candidates faced dilemmas or problems and successfully overcame them.

When candidates don’t fit the culture

While depicting your culture accurately will allow employers to identify bad hires, it will also allow candidates to filter themselves in or out based on how you describe the company in job postings and throughout the interview process.

However, during the hiring process, you may realize that an individual is not a good fit. Poor hiring decisions can be extremely costly for your company, in terms of business interruption, wasted recruiting and training resources, and lower employee morale.

To ensure you are following best practices, keep these tips in mind:

  • Human resources should stay on top of monitoring, learning and studying the culture of the organization, and then design policies that align with the culture.

If the company promotes itself differently than how the culture really is, then prospective employees will be lured in under false pretenses. If employees realize that they’ve been sold on a company inaccurately, they will probably leave shortly after being hired and will lack the morale needed to succeed while they are still there.

  • Before beginning the hiring process, ensure your HR department is up-to-date with hiring legislation or consult a third-party HR expert.

Emphasizing a company culture can become a legal exposure with regard to compliance audits and discrimination accusations. If you do not hire someone based on the fact that they “did not fit in with your culture” but have no quantitative proof to back this up, your organization may be held liable for discrimination or failure to comply with equal hiring provisions.

Maintain accurate records of all your hiring decisions. During an audit or discrimination claim, you will need to produce valid justification for your decisions.

Culture is the unifying element that holds everyone in an organization together. Unlike an established mission statement, culture encompasses the written and unwritten behavioral norms and expectations of those within the company.

Culture can also set one company apart from others, and it can include the value of work-life balance issues, the way the company is organized, the extent to which leaders follow through on mission statements and many other factors.

In order to maximize the benefits of considering culture throughout the hiring process, HR should constantly be asking if the organization is truly what it claims, if it needs to modify the culture to be more competitive, and if it is remaining compliant with all hiring laws.


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House Republicans Release Legislation to Repeal and Replace the ACA

March 23, 2017 | Leave a Comment

On March 6, 2017, the House Ways and Means Committee and the House Energy and Commerce Committee each released budget reconciliation bills. These pieces of legislation are part of the House Republican’s American Health Care Act (AHCA), the legislation designed to repeal and replace the Affordable Care Act (ACA).

Though both bills must pass through the legislative process before becoming law, it is important to understand the potential changes to come if the legislation becomes effective. This article outlines the major changes proposed in the legislation:

  • Changes to the ACA
    The AHCA proposes to repeal both the individual and employer mandate penalties. It would also eliminate ACA-imposed taxes on over-the-counter medications, medical devices, prescription drugs and health insurance premiums.
  • Changes to Tax Credits
    The AHCA would repeal the ACA premium tax credits beginning in 2020 and replace them with a new age-adjusted, fixed-dollar refundable tax credit. The tax credit would be adjusted for inflation and be available only to people who are not eligible for employer- or government-sponsored health insurance. The AHCA would also repeal the ACA small business tax credit beginning in 2020.
  • Changes to Health Spending Accounts
    The AHCA would lower taxes on health savings account (HSA) distributions on nonqualified medical expenses to pre-ACA rates effective after Dec. 31, 2017, and allow both spouses to make catch-up contributions to one HSA beginning in 2018. The legislation would also repeal the contribution limits on flexible spending accounts (FSAs), effective for taxable years beginning after Dec. 31, 2017.
  • Changes to Health Insurance Markets
    The AHCA would repeal the cost-sharing subsidy program. It would also establish a continuous health insurance coverage incentive and the Patient and State Stability Fund, which is designed to lower patient costs and stabilize state markets.

The bills that make up the AHCA were primarily focused on what changes would be made to existing ACA rules. What will not change under the proposal?

  • Pre-existing Conditions
    The ACA mandate prohibiting insurers from denying or charging more for coverage to patients with pre-existing conditions would be preserved.
  • Coverage for Adult Children
    The AHCA would preserve the ACA’s rule allowing young adult dependents to remain on their parents’ plans until they are 26.
  • Cost-sharing Limits
    Out-of-pocket maximum limits imposed on non-grandfathered plans by the ACA would continue to apply. These limits are currently $7,150 for single and $14,300 for family coverage.
  • Annual and Lifetime Limits
    The AHCA would retain the prohibition on annual and lifetime limits on essential health benefits.

For more information, visit the Ways and Means Committee and the Energy and Commerce Committee websites.

Posted in Blog, Health Care Reform Info | Tagged  ,