Benefit News

Reminder: 2014 Annual Reporting Deadlines

April 03, 2015

San Francisco Health Care Security Ordinance, San Francisco Fair Chance Ordinance, San Francisco and Bay Area Commuter Benefits Programs

This Legislative Update is a reminder that April 30, 2015 is the deadline for employers subject to San Francisco's Health Care Security Ordinance (HCSO) and those covered by San Francisco's Fair Chance Ordinance (which took effect on August 13, 2014) to file an annual report (2014 Employer Annual Reporting Form) to substantiate compliance with these ordinances for 2014. Covered employers who fail to submit the 2014 Employer Annual Reporting Form will be subject to a penalty of $500 per quarter.

In addition, to the extent applicable, employers covered by the Bay Area Commuter Benefits Program that have not already done so, must register their program, and new and previously non-compliant employers subject to the San Francisco Commuter Benefits Program must complete a compliance reporting form by April 30, 2015.

New Reporting Requirements

  • The 2014 Employer Annual Reporting Form includes a new section for those employers subject to San Francisco's Fair Chance Ordinance. Thus, all employers covered by either the Fair Chance Ordinance or the HCSO will use the 2014 Employer Annual Reporting Form to satisfy these reporting requirements
  • Additional HCSO reporting requirements apply to covered employers who made contributions to excepted benefits health reimbursement accounts (HRAs) on behalf of covered employees during 2014 to satisfy their HCSO obligations. This includes providing aggregate information on allocations, reimbursements, and any "true-up" spending made[1]
  • Covered employers who imposed a surcharge on their customers either to cover (or partially cover) the costs of providing health care and/or to comply with the HCSO are required to disclose the amount collected from the surcharge during 2014
  • Employers in San Francisco with more than 50 full-time employees in the Bay Area must comply with the Bay Area Commuter Benefits Program and not the San Francisco Commuter Benefits Ordinance. The San Francisco Commuter Benefits Ordinance, in effect since 2009, now only applies to employers with more than 20 employees nationwide, but less than 50 full-time employees in the Bay Area, and a location in San Francisco. New and non-compliant businesses must complete an annual compliance reporting form by April 30, 2015, available at http://www.sfenvironment.org/article/businessesemployees/san-francisco-commuter-benefits-ordinance-compliance-form. As the City is currently streamlining its reporting process, at this time, covered businesses that have previously reported their benefits program and are in compliance, are being requested not to complete the annual compliance reporting form
  • The Bay Area Commuter Benefits Program went into effect on September 30, 2014, and requires employers located within the geographic boundaries of the Bay Area Air District[2] that have 50 or more full-time employees within the Bay Area, to offer a commuter benefit option to their "covered" employees no later than September 30, 2014. Covered employers must complete an online registration process and update their registration form annually. Those who have not registered should do so as soon as possible at https://commuterbenefits.511.org.

HCSO

Employers are covered by the HCSO during 2014, and thus subject to the 2014 annual reporting requirement, if they satisfy all of the following three requirements:

  • They employed one or more workers who performed work within the geographic boundaries of the City and County of San Francisco in any calendar quarter during 2014; and
  • They are a for-profit business with 20 or more persons who performed work in any calendar quarter during 2014, or a nonprofit business with 50 or more persons who performed work during any calendar quarter during 2014 (regardless of where the persons are located); and
  • They are required to obtain a valid San Francisco business registration certificate pursuant to Article 12 of the Business and Tax Regulations Code.

The following employers are not covered by the HCSO:

  • A private employer that employed fewer than 20 persons (including those employed outside of San Francisco) in each of the four calendar quarters of 2014; or
  • A non-profit corporation that employed fewer than 50 persons (including those employed outside of the City) in each of the four calendar quarters of 2014; or
  • Employers that had no covered employees in San Francisco during 2014.

Employers who were not covered by the HCSO in any quarter of 2014 are not required to complete the 2014 Employer Annual Reporting Form. They do not need to notify the City that they were not covered; no further action is required.

Fair Chance Ordinance

The Fair Chance Ordinance is codified in Article 49 of the San Francisco Police Code and Chapter 12T of the San Francisco Administrative Code, and applies to employers in the City and County of San Francisco with 20 or more employees worldwide, as well as City contractors, and housing providers. The ordinance specifically requires covered employers to review an individual's qualifications before inquiring about that person's arrest and conviction record(s) and related information, and requires that they limit the use of criminal history information and follow certain procedures and restrictions when inquiring about and using that information.

Bay Area Commuter Benefits Program

Businesses subject to the Bay Area Commuter Benefits Program must offer one of the following four commuter benefit options to its employees:

    Employee-paid Pre-tax Deduction: Allow employees to exclude their transit or vanpool costs from taxable income to the maximum amount as allowed by federal law (currently $130 per month); or

    Employer-paid Subsidy: Provide a subsidy of up to $75 per month to reduce or cover employees' monthly transit or vanpool costs; or Employer-provided Transportation Service: Provide free or low cost bus, shuttle or vanpool service for employees, operated by or for the employer; or

    Similar Alternative: Provide an alternative commuter benefit that is as effective in reducing single-occupancy commute trips as any of the above options.

San Francisco Commuter Benefits Ordinance

Businesses subject to the San Francisco Commuter Benefits Ordinance must offer one of the following employee benefit programs:

  • Employee-paid Pre-tax Deduction: Allow employees to exclude their transit or vanpool costs from taxable income to the maximum amount as allowed by federal law (currently $130 per month); or
  • Employer- paid Subsidy: Provide a transit pass or reimburse the employee for equivalent van pool charges in an amount that is at least equal in value to the purchase price of a monthly Muni "A" Pass; or
  • Employer-provided Transportation Service: Provide free bus or vanpool service to their employees.

Resources for complying with the HCSO and Fair Chance Ordinance reporting requirements are provided below:

  • The 2014 Employer Annual Reporting Form is available at https://etaxstatement.sfgov.org/OLSE/
  • Detailed instructions are available at http://sfgsa.org/index.aspx?page=6002 with an additional link to screen shots of the reporting form at http://sfgsa.org/modules/showdocument.aspx?documentid=10016
  • Administrative guidance regarding the HCSO is available at http://sfgsa.org/Modules/ShowDocument.aspx?documentID=9981
  • Information regarding the Fair Chance Ordinance is available at http://sfgsa.org/index.aspx?page=6599
  • Fair Chance Ordinance Frequently Asked Questions are available at http://sfgsa.org/modules/showdocument.aspx?documentid=12136

Information regarding the Bay Area Commuter Benefits Program is available at https://commuterbenefits.511.org and information regarding the San Francisco Commuter Benefits Ordinance is available at http://www.sfenvironment.org/sites/default/files/fliers/files/sfe_tr_2014_commuter_benefits_ordinance_overview.pdf.

For additional information, please contact your Burnham Benefits Consultant or Burnham Benefits at 949-833-2983 or inquiries@burnhambenefits.com.


[1] "True-up spending" refers to replacement contributions made for revocable contributions previously made to an excepted benefits HRA to an employee who worked in excess of an average of 20 hours per week that were not actually reimbursed to the employee for expenses incurred in 2014. An employer has until April 10, 2015 to make such replacement expenditures or it will not have satisfied its health care spending requirement for 2014.
[2] Those located in Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano and Sonoma Counties.

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