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Spring 2013 | Maryland PHCC Contractor [ 3 ]

Spring 2013

PRESIDENTTHOMAS KELLER

ELLICOTT CITY, MD(410) 203-1741

(410) 203-2638 FAX

SECRETARYKATHARINE K. STRADLEY

ELLICOTT CITY, MD(410) 442-2221

(410) 442-7626 FAX

TREASURERFREDERICK WOLFBALTIMORE, MD(410) 327-4750

(410) 563-1611 FAX

SERGEANT AT ARMSTIMOTHY FELDMAN

ELKRIDGE, MD(410) 536-5700

(410) 536-5705 FAX

OFFICERS 2013 .............................

Maryland PHCC Contractor Magazine is the official magazine of The Maryland Plumbing-Heating-Cooling Contractors and is published four times annually. The Maryland PHCC does not necessarily en-dorse any of the companies advertising in this publication or the views of its writers.

Maryland PHCC Contractor Magazine is designed and published by Blue Water Publishers, LLC. Articles and information published in this magazine may not be reproduced without written consent of The Maryland PHCC or Blue Water Publishers, LLC. The publisher cannot assume re-sponsibility for claims made by advertisers and is not responsible for the opinions expressed by contributing authors.

For more information on advertising, contact Jim Aitkins

Blue Water Publishers, LLC 22727 - 161st Avenue SE, Monroe, WA 98272

360-805-6474 / fax: 360-805-6475 jima@bluewaterpublishers.com

Senior Editor - Diane P. Kastner

President’s Message - Thomas Keller 4Maryland PHCC Open Enrollment/Skip Test 6While America Slept - The Legislative Rubber Hits the Regulatory Road 8Major Social Issues Blow into Annapolis in 2013 10Instructors Wanted 13Legal Shield 142013 Employment Law Trends and Changes 16Maryland PHCC Introductory Membership Application 17Maryland PHCC 32-Hour Backflow Certification Course Information 20Backflow Course Application 21

CONTENTS ..........

Apple Ford Page 19Bradford White 23Cummins-Wagner 13Delany Products 15FastEst 22Hodes Co. 18Liberty Pumps 24

Parts Unlimited 2ROI Marketing 18Saniflo 11SureSeal Manufacturing 5T&S Brass 11Virginia Marketing Associates 13Watts Water Technologies 7

ADVERTISER SUPPORT.....

DIRECTORSJIM BERNDT

BALTIMORE, MD (410) 254-7473

(410) 256-4787 FAX

RONALD MCBEE, SR.BALTIMORE, MD (410) 444-5448

(410) 426-5440 FAX

STEVEN M. SCHAEFERWESTMINSTER, MD

(410) 876-6825(410) 857-0011 FAX

BRUCE J. SOLOMONREISTERSTOWN, MD

(410) 833- 2188 (410) 833-9023 FAX

RONALD STIEGLERELDERSBURG, MD

(410) 876-6825

STEVEN M. SCHAEFERADMINISTRATIVE CHAIR

WESTMINSTER, MD(410) 876-6825

JIM BERNDT BALTIMORE, MD(410) 254-7373

VERNON L. GAUSS, JR.KINGSVILLE, MD

RONALD W. STIEGLERELDERSBURG, MD

(410) 876-6825

KATHARINE K. STRADLEYELLICOTT CITY, MD

(410) 442-2221

RALPH M. VITALE, SR.BALTIMORE, MD(410) 665-6262

EDGAR W. ZEPP, IVCLARKSVILLE, MD

(410) 531-6712

WALTER L. BREWERTIMONIUM, MD

THOMAS N. EARPHANOVER, PA

VERNON L. GAUSS, JR.KINGSVILLE, MD

PAUL F. GOEDEKE BALTIMORE, MD

RALPH M. VITALE, SR.BALTIMORE, MD

APPRENTICESHIPEDUCATION COUNCIL MEMBERS

HONORARY LIFE MEMBERS

PHCC CONTRACTOR MAGAZINEmaryland Ken Mallick

Mallick PlumbingGaithersburg, MD

MD PHCC - NEW MEMBERS........Sean P. BrownApple Ford LincolnColumbia, MD

II would like to introduce myself. My name is Tom Keller a member and a small business owner like many of you. I have been involved with the Maryland Plumbing Heating

Cooling Contractors Association (MPHCC) for seven years. This year, I am honored to be selected as the 2013 President of the MPHCC.

I am looking forward to overseeing our Association’s membership programs and services such as, legislation, education, membership meetings, our trade show and all of our membership benefits.

Our lobbyist, Gil Genn is working hard monitoring current legislation that affects our businesses. Our education programs are going strong and we will continue to provide training for all of our up and coming tradesmen. We are working on improving our general membership meetings to include special guest speakers and presenters. Industry topics will include technical demonstrations/displays and training, and business topics such as reviewing the Affordable Health Care Act.

We are excited to present a new benefit program for members called Legal Shield to help protect members, their families and employees against identity theft. Identity theft is one of the fastest growing crimes in America today. This program offers credit analysis, daily credit monitoring and identity restoration. There is also an optional legal service benefit available to help with estate planning, telephone consultations, motor vehicle violation assistance and much more.

Mark your calendars! Our trade show has moved this year. It will be held on Thursday, September 19th at the Howard County Fairgrounds. Keep checking our website for more information as it gets closer.

I encourage more members to engage with the Association. New voices are needed to help and support the stewards of MPHCC with our continuing services. There are many ways to participate. It can be as simple as attending meetings or you can be more involved by volunteering your time to

become a board member or to serve on a committee. I promise that you will be rewarded knowing you are helping make a difference. Times are changing but no matter what happens with the housing development, government funding, etc. it’s good to know that the MPHCC will be there to continue to look out for our trades and our businesses.

I hope to see you at one of our events this year.

For more information on the Legal Shield program or other information visit our website www.MarylandPHCC.org

PRESIDENT’S MESSAGE

Thomas Keller

Put thePHCC Advantageto Work for You

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Spring 2013 | Maryland PHCC Contractor [ 5 ]

[ 6 ] Maryland PHCC Contractor | Spring 2013

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The 112th Congress is over….in a way. Much has been said in the media and the coverage has been detailed and negative, accusing Congress of being dysfunctional. I suspect Americans heard on the news

“Obama” and “Boehner” more than we’ve ever heard the names of the President and Speaker of the House used in combination. And yes, Congress was challenged with historic decisions on national budget policy and yes, some of these decisions were again delayed (until late February, 2013). But of all the dynamics in Washington, DC, in the past two years, the most dangerous were never discussed on the nightly news. While Americans watched the wheels of the legislative process in gridlock, the wheels of the regulatory process kept spinning.

Congress goes into session and out of session, but the regulatory process works 24/7 365 days a year. This should strike fear in the hearts of all who believe that our elected lawmakers are the only ones who make public policy decisions in our nation. While most Americans are fixated on what happens on Capitol Hill they may not know or understand that much of what we live with in terms of compliance with laws and regulations, are designed by federal agencies (non-elected officials). What may also be misunderstood is that when Congress passes a law, the parameters of that law are vague-allowing for interpretation by regulators.

So how do we prepare for 2013 and 2014 and what’s coming down the pike that contractors need to be aware of?

As a kid I was taught to look both ways before crossing the street. Looking both ways ensures that you’ve assessed the danger from both directions. My parents also taught me to always look left first because that’s the traffic that can hit you right away when you decide to take that step into the street.

Advocacy is similar, you need to look both ways in order to make a sound decision and protect your interests. In this case,

the legislative process is the second line of traffic you need to look out for; the regulatory process is the traffic coming from the left side that can hit you right away. (To be clear, the distinction between left and right is in no way intended to parallel the political left and right).

With an Administration that will never have to campaign for the White House again fresh off a campaign that set the stage for high regulatory activity, industry should be building its advocacy abilities with a keen eye on both the legislative and regulatory sides of governance. We are heading into arguably one of the most potentially dangerous regulatory times in our history. Dangerous because of the issues, yes, but equally as dangerous because of the process.

To a degree, what we’ve experienced recently is an erosion of our system of checks and balances. The point is that it is as important to lobby the regulatory process as it is to lobby the legislative process. In fact, we can use the legislative process to help us influence the regulatory process.

We as an industry need to take advantage of our opportunities. We need to lobby the front end of lawmaking (the legislative process) and the back end of lawmaking (the regulatory process). We can use them interchangeably and our relationship with Capitol Hill is as crucial as our relationship with regulatory agencies.

The legislative process receives a great deal more attention than the regulatory process for many reasons-most notably, the visibility of Capitol Hill and coverage of the media. However, make no mistake, the regulatory process can be very dangerous if ignored. A true advocacy program (federal, state, and local) consists of a strong voice on Capitol Hill, and, a strong voice within the regulatory process…where the legislative rubber hits the regulatory road.

By Mark Riso

The Legislative RubberHits the Regulatory RoadZZZZZ

Z Z Z Z ZWhile America Slept

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continued on page 9

Workforce Guidelines for the Federal Weatherization Assistance Program (WAP)A federal certification program for single family and multi-family housing weatherization professionals

• Four job classifications-auditor, quality assurance, crew leader, installer

• Technicians must pass written and practical test• Pilot certification program currently being offered• Final guidelines for single family to be released in

the near future• Next round of comments for guidelines for multi-

family housing to be released by late spring, 2013

Lead Paint Rule (LRRP)EPA rule requiring the use of lead-safe practices and other actions aimed at preventing lead poisoning. Under the rule, contractors performing renovation, repair and painting projects that disturb lead-based paint in homes, child care facilities, and schools built before 1978 must be certified and must follow specific work practices to prevent lead contamination.

• New rule for commercial & public buildings• EPA to hold public hearing for its LRRP rule

(commercial & public buildings) in June, 2013• Final rule-January, 2015 with compliance

(enforcement), 2016

Final Furnace, Air Conditioner & Heat Pump RuleThe U.S. Department of Energy established a rule regulating the installation of gas furnaces relative to the geographic location of that installation in the United States. This rule will prohibit installation of gas furnaces that are less than 90% efficient in the northern states (as determined by DOE) after May 1, 2013. The goal of the rule is to increase the efficiency of heating in areas where it is economically justified. The installation should also provide a reasonable payback to the consumer. Enforcement of this rule will require the installing

contractor to maintain adequate records. PHCC has a waiver position and has been told that DOE is willing to consider a waiver to this rule based on hardship or excessive cost situations. If DOE approves a waiver, then it would be the installing contractor who would make the decision that a waiver is justified.

• The rule was recently vacated as a result of mediation (lawsuit)

Lead Free Brass• Modification of the Safe Drinking Water Act• Establishes a 0.25% weighted average of the wetted

parts of the devices anticipated to provide drinking water

• Implementation on January 4, 2014• No sell through date on products• Concern to store, distribute, and install proper

products• Maintain skill and technique when soldering

-Careful cleaning and preparation -Proper flux selection-Ensure uniform heating-Allow for adequate cooling

R-22• Production will be reduced in 2013• Plan for anticipated needs early• Encourage upgrades to new equipment with

alternate refrigerants• Be careful with replacement R-22 products,

standard ratings and certifications are with R-22 not R-22 replacement refrigerants

Health Care Reform• Compliance – certain provisions set for compliance

in 2013 with most coming in 2014• PHCC Education and Training Materials on PHCC

National’s website

Here’s what’s coming...

Z Z

Spring 2013 | Maryland PHCC Contractor [ 9 ]

The Maryland Plumbing, Heating & Cooling Contractors continue to provide the Maryland Legislature with informed and factual testimony to protect the health of all Marylanders and preserve and improve the plumbing

trade.Early in the session, we testified in strong support of SB

77, “Board of Plumbing, Continuing Professional Competency, Master Plumbers and Master Natural Gas Fitters.” This depart-mental bill requires the State Board of Plumbing to establish, by regulation, continuing professional competency requirements for licensed master plumbers and licensed master natural gas fitters. Licensees must complete 16 educational hours as a condition of each license renewal beyond the first. The requirement is phased in for specified licensees whose license expires before October 1, 2016. The bill has passed the Senate and awaits a hearing in the House where the prospects look good. This bill is a result of MDPHCC’s ongoing discussions, meetings and advocacy with the Department of Labor, Licensing & Regulation over the years to provide greater competency in the trade.

January 2013 saw the Second Inaugural of Barack Obama and the State of the Union Speech in February that set the parameters for social and fiscal change. Twenty miles east of Washington, DC, down Route 50 in Annapolis Maryland, Governor Martin O’Malley gave his State of the State speech outlining many similar positions. The Maryland governor clearly has designs on moving 20 miles west to Pennsylvania Avenue.

Several of the Governor’s initiatives this legislative session are a reflection of where he perceives the Maryland electorate to be and where he thinks the national electorate is now and may be in 2016.

In the wake of the national tragedy in Newtown, Connecticut, a renewed debate has ignited over the current polices on gun right and gun control. The Governor has fired a full round of political capital to get this passed and views this as a legacy accomplishment in his second term. The Administration’s major gun control reform legislation cleared the State Senate on February 28th and heads to the House.

The amended bill, which passed 28-19, includes a ban on so-called assault weapons, including a number of semiautomatic

rifles, a ban on magazine clips that hold more than 10 rounds and a new licensing requirement for future handgun purchases that will including fingerprinting, a licensing fee and several hours of safety training. Those Marylanders who currently own weapons or magazines banned under the bill will be allowed to keep them, as long as they register the firearms with Maryland State Police. The bill now heads to the House Judiciary Committee where they will begin to debate the merits of the Senate version and House amendments.

The Governor has doubled down on another major social debate, the repeal of the death penalty. Late in February, the State Senate Committee voted favorably to repeal the death penalty and the bill is now pending on the Senate floor. The committee agreed to remove the provision requiring the Governor to include $500,000 for the State Victims of Crime Fund in the annual budget. Some members were concerned that the appropriation to the fund might preclude a referendum on this bill in 2014, since appropriation bills may not be petitioned to referendum. Under the bill, instead of being sentenced to death, an individual found guilty of first degree murder would be sentenced to life imprisonment or life imprisonment without the possibility of parole.

In another nod to a major debate in the energy arena, Governor O’Malley’s offshore wind energy bill passed the House. HB 226 creates a market for offshore wind energy through establishment of a “carve-out” for energy derived from offshore wind in the State Renewable Energy Portfolio Standard. Beginning in 2017, electricity sales are required to include an amount derived from offshore wind.

Qualified offshore wind projects must be approved by the Public Service Commission (PSC), which may not approve an offshore wind project unless the project is beneficial to the State; the projected rate impact does not exceed $1.50 per month for the average residential customer in 2012 dollars; and does not exceed 1.5% of nonresidential customers’ total annual electric bills. A Maryland Offshore Wind Business Development Fund and a Maryland Offshore Wind Business Development Advisory Committee are to provide financial and business development assistance, as well as employee training opportunities to emerging wind energy businesses in the State.

MAJOR SOCIAL ISSUESBlow into Annapolis in 2013

Gil Genn, Esq.MDPHCC Government Relations Consultant

[ 10 ] Maryland PHCC Contractor | Spring 2013continued on page 12

Spring 2013 | Maryland PHCC Contractor [ 11 ]

What do the Beach Boys,Mickey Mouse, and T&S low-lead faucets have in common?

Mickey Mouse® and the Beach Boys® are trademarks of Disney Enterprises, Inc. and Brothers Records, Inc., respectively, and T&S Brass has no affiliation with either such entity.

They all got their start in California, and they all swept the nation. Although California led the way with the AB1953 legislation mandating low-lead faucets, it’s only a matter of time until they are required in all states. And T&S is ready — all of our faucets are low-lead compliant and are available across the country. And, as always, T&S faucets are as rugged and reliable as they come, and meet the requirements of the Buy America Act. Contact your sales rep for more information.

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As amended, the measure establishes the Clean Energy Program Task Force to study and make recommendations regarding the feasibility of establishing a degree or certificate program in clean energy at one or more colleges or universities in Maryland. The Senate bill is being debated in the Finance committee. This is the third year this bill had been heard and the Administration is banking that the third time is the charm.

Another bill dealing with the crumbling infrastructure for gas transmission has passed and awaits the Governor’s signature. With final House approval, SB 8 establishes a process for a gas company to file a plan with the PSC requesting authorization to accelerate infrastructure replacement and to finance the reasonable and prudent costs of the work by a surcharge on customers’ bills. The bill further specifies the required components of a plan and cost calculations and limits the monthly surcharge for residential and other gas customers. The limit on the surcharge is $2 per month for each residential gas customer. The surcharge for a nonresidential customer must not be less than the fixed annual surcharge applicable to a residential customer, but must be capped at a level proportionate to the residential surcharge.

In order to fund another area of crumbling infrastructure, a Senate committee has considered SB 830, the Transportation Financing Act, which authorizes the Maryland Transit Administration (MTA) to establish two transit benefit districts to finance, construct, and operate and maintain transit facilities and transit services. MTA may establish one district in the Baltimore metropolitan area and one in the Washington metropolitan area. Each transit benefit district is authorized to impose a property tax and to issue bonds. The bill also imposes an additional 3% sales and use tax equivalent rate on all fuels except aviation gasoline and turbine fuel based on the retail price of gasoline, excluding State and federal taxes, and authorizes counties to impose a motor fuel tax of up to five cents per gallon.

Beginning in calendar 2017, the bill will impose a motor fuel tax in any county that does not impose a tax at the maximum rate, in the amount of the difference between the motor fuel tax rate the county imposes and five cents. The bill takes effect June 1, 2013, except for the motor fuel tax provisions that take effect January 1, 2014.

Another bill, SB 653, increases the State sales tax rate from 6% to 6.5% in any county in which the MTA or WMATA provides any service. The bill also establishes in the Transportation Trust Fund (TTF) a Mass Transit Account to receive 7.7% of sales tax revenues collected on sales in these counties to pay for the cost of light rail and Metro subway transit facilities and transit service in those jurisdictions.

In order to stimulate a lagging economy, the Administration is introducing a Public-Private Partnership bill to establish a State policy on the use of public-private partnerships (P3s) and expressly authorize specified State agencies to enter into P3s. A “public-private partnership” is defined as a method for delivering public infrastructure assets using a long-term, performance-based agreement between specified State “reporting” agencies

and a private entity where appropriate risks and benefits can be allocated in a cost-effective manner between the contract partners. Under the bill, a private entity performs functions normally undertaken by the government, but the reporting agency remains ultimately accountable for the public infrastructure asset and its public function. The State may retain ownership of the public infrastructure asset and the private entity may be given additional decision-making rights in determining how the asset is financed, developed, constructed, operated, and maintained over its life cycle. The bills establish a process and associated reporting requirements for State oversight of P3s and institute a process for both solicited and unsolicited P3 proposals that must be followed before the Board of Public Works may approve a P3 agreement. This will be an important method to stimulate construction of roads, schools and other necessary infrastructure improvements. Virginia did this years ago in the development of the Northern Virginia “Greenway” toll road.

Annapolis has never failed to entertain all with some political drama. Immediately, at the start of session there was a vacancy in the House of Delegates. Delegate Tiffany Alston, an attorney and member of the House Judiciary committee was statutorily removed from her seat when she pleaded ‘no contest’ to a charge of misusing campaign funds to pay for her wedding and was given a year’s suspended sentence for misusing General Assembly funds for campaign staff. What was she thinking? The Governor appointed a former member of the House from that area of Prince George’s County, Darren Swain, but not before he rejected the Democratic Central Committee’s recommendation of a person who had been convicted of involvement in a murder 20 years earlier. That person filed suit but the State’s highest court agreed that the Governor could ignore the recommendation. Only in Maryland.

Further internal drama was heard in the halls at the beginning of the 2013 Legislative Session when a poll was released that indicates Governor O’Malley’s job approval number is at 54% and 41% disapprove of the job he is doing. O’Malley’s numbers are 20% below that of another nearby Governor who is also eyeing the White House. Governor Chris Christie sits at 74% approval in large part because of his handling of Hurricane Sandy and relief efforts. Despite wins on a number of high-profile issues in 2012 and likely in 2013, O’Malley isn’t feeling the love from Marylanders for a possible 2016 presidential bid.

On the question of whether O’Malley should run for president, only 25 % said he should. Democrats said at 44% he should stay out of the race, while 32 percent would like to see him run. Even among Independents, 59 percent of independents said he should not run, as did 83 percent of Republicans. Maybe it will all be moot as two potential titans suck up all the political air for a 2016 match-up, Governor Christie vs. former Secretary of State Hillary Clinton.

Notwithstanding all the above, MDPHCC continues the strong advocacy for your business and profession and welcomes your input to do an even better job for you.

[ 12 ] Maryland PHCC Contractor | Spring 2013

Spring 2013 | Maryland PHCC Contractor [ 13 ]

The Maryland Plumbing-Heating-Cooling Contractors Education Council are now accepting applications for Instructors to teach in our Plumbing apprenticeship school.

Course information: Classes are held September through April, two nights per week 6:00 p.m. – 9:00 p.m.

Anne Arundel County -- Center of Applied Technology, Stevenson Road, Severn, MD. Classes at this location are on Monday and Wednesday evenings.

Baltimore County -- Essex Community College, 7201 Rossville Blvd., Baltimore, MD. Classes at this location are on Tuesday and Thursday evenings. Qualifications:

• Prior teaching experience is preferred, but not required.

• A Master Plumber/Master Inspector or Journey License is essential.

• Four years trade experience is acceptable, yet a minimum of six years is preferred.

To apply you may fax your resume to (410) 750-2507 or call the Maryland PHCC office (410) 461-5977 for an application .

Maryland and Virginia ListingZoeller:

Sump, Sewage, Grinder Pumps up to 7.5 HP, Basins, Controls & Accessories

Zoeller Engineer Pumps:

Sump, Sewage, Grinder Pumps and Pumping Stations up to 100 HP, Basins, Controls & Accessories

Flint & Walling:

Submersible & Jet Pumps for wells. Constant Pressure & Booster Pumps

Clarus:

Advanced Treatment Systems, Effluent Pumps, Septic Tanks Filters, Recirculating Media Filters, Controls & Accessories

Mustee:

Shower Bases, Laundry Tubs, Mop Sinks, Tub/Shower Wall Kits, ADA Grab Bar & Fold-up Seats

Schier:

Grease Interceptors, Oil Separators, Solid Interceptors, Acid Neutralization Tanks Custom Process Systems

Quick Fittings/ProBite:

Push to Connect Fittings. No-lead, Low Lead and Copper

Outdoor Shower Company:

Stainless Steel Outdoor Showers Systems & Accessories

Virginia Only ListingState Water Heaters, Symmons, Insinkerator, Chicago Faucets, Accor, Guardian, Oatey SCS, Harvey, and Woodford

Praxis Industries:

Aquarius, American Whirlpool & Comfort Design

Please see Web Site for Links to all Factories and full list of AssociatesWeb: www.virginiamarketingassociates.com

MD PH: 1-301-432-5028 F: 1-301-432-5721 | VA PH: 1-804-569-0360 F: 1-804-569-0361Email: jcvamarketing@verizon.net | cjvamarketing@gmail.com

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Federal and state laws change every year and new trends emerge. As an employer, you should be aware of the following.

Minimum Wage Although the 2013 federal minimum wage will remain unchanged at $7.25 per hour, ten states have announced that their minimum wage will increase on January 1, 2013. They are:

• Arizona: $7.65 to $7.80 per hour• Colorado: $7.64 to $7.78 per hour• Florida: $7.67 to $7.79 per hour, tipped employees -

$4.65 to $4.77 per hour• Missouri: $7.25 to $7.35 per hour• Montana: $7.65 to $7.80 per hour• Ohio: $7.70 to $7.85 per hour, tipped employees -

$3.85 to $3.93 • Oregon: $8.80 to $ 8.95 per hour• Rhode Island: $7.40 to $7.75 per hour• Vermont: $8.46 to $8.60 per hour, tipped employees -

$4.17 per hour• Washington: $9.02 to $9.19 per hour

American Tax Payer Relief Act Congress passed the American Taxpayer Relief Act of 2012. The legislation extends permanently a number of tax provisions that had expired at the end of 2011 and 2012; revises tax rates on income for married couples filing jointly at $450,000 and single at $400,000 of taxable income; modifies the estate tax; and extends unemployment benefits, Medicare payments and farm subsidies. Some specific payroll related provisions include:

• Permanently extends employer-provided education assistance (Section 127 of the Internal Revenue Code), which allows an employee to exclude from income up to $5,250 per year in educational assistance at the undergraduate and graduate level regardless of whether the education is job-related.

• Permanently extends the increase in the monthly exclusion for employer-provided transit and vanpool benefits.

• Extends federal emergency unemployment benefits for one year.

• Reinstates and extends the Work Opportunity Tax Credit through 2013.

• The legislation does not include an extension of the 2 percent payroll “holiday” for Social Security (FICA) employee tax so the FICA deduction returns to the regular 6.2 percent on the first payroll of 2013 (during the “holiday” period, the rate was 4.2 percent).

Retirement Plan Limits The Internal Revenue Service made cost-of-living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2013. In general, many of the pension plan limitations will change for 2013 because the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment. However, other limitations will remain unchanged because the increase in the index did not meet the statutory thresholds that trigger their adjustment.

Affordable Care Act (ACA) Now that much of the healthcare reform uncertainty has been lifted, it’s time to get to work and focus on the many healthcare compliance obligations and possible economic impacts to your business. While there are many issues to address immediately, the “big ticket” items won’t go into effect until 2014, including the “pay or play” mandate, new nondiscrimination requirements, and automatic enrollment.

Make sure to use 2013 to adequately plan for additional economic burdens. Access the link below for a fact sheet on the top things you should know and do as a small business owner associated with the Affordable Care Act.

Paid Sick Leave Laws Laws that require all employers to provide paid sick time to employees are on the rise. Laws were passed in Seattle, Philadelphia, Connecticut, San Francisco, and Washington D.C. in 2012. New York, Massachusetts, Miami, and Portland (OR) are just some of the jurisdictions considering passage in 2013. Be prepared for this legislation. You will be worried about cost; however, some studies cite that the cost is minimal. The yearly average number of sick days per employee is three.

2013 Employment Law Trends & Changes

Prepared for the PHCC Educational Foundation by TPO, Inc.

continued on page 18

Spring 2013 | Maryland PHCC Contractor [ 17 ]

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Worker Misclassification More active enforcement efforts are expected from the IRS and the US Department of Labor (DOL) in 2013 with regard to the misclassification of workers as independent contractors. Pending legislation at the state and federal levels, as well as executive orders at the state level establishing dedicated task forces to look at this issue, continued throughout 2012. Legislative reform as part of the resolution for the fiscal cliff is also expected to include provisions that would impose harsher financial penalties on employers who misclassify their workers. Further national and regional enforcement efforts/initiatives specific to industries in lower wage sectors, such as hospitality and construction, are also anticipated in 2013.

Equal Employment Opportunity Commission (EEOC) – Background Checks In 2012, the EEOC released new guidance attempting to restrict the use of criminal background checks for new hires. New laws restricting what employers can find out behind the scenes about their applicants and employees during credit report background checks are on the rise. Vermont became the eighth state to pass such a law in 2012, joining California, Connecticut, Hawaii, Illinois, Maryland, Oregon, and Washington.

The Equal Employment Opportunity Commission (EEOC) addressed in detail how an employer can use criminal record checks in employment decisions. While the EEOC has always cautioned employers not to use such records to disqualify employment across the board, they also provided guidance on

how to use criminal record check information in employment decisions without violating Title VII of the Civil Rights Act or leading to discrimination claims. The EEOC recommends that employers:

• Use criminal background check information in a neutral manner so as not to screen out applicants who are classified as “protected classes,” based on race and national origins. This can best be achieved by asking three questions: 1. What is the nature and gravity of the criminal offense? 2. How long has it been since the applicant committed the offense? 3. What is the relationship between the offense committed and the job’s requirements?

• Determine if there are mitigating circumstances regarding any information provided by the criminal records check. This can be accomplished by giving the applicant an opportunity to explain and demonstrate why the information discovered in the background check should not disqualify the applicant from the job.

• Eliminate policies that bar employment based on any criminal records regardless of context.

• Train hiring managers about Title VII and how to apply it to a criminal records check policy.

• Create a policy that matches the job requirements and the offenses that potentially disqualify an applicant from a job.

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Spring 2013 | Maryland PHCC Contractor [ 19 ]

Social Media Password Laws There has been a proliferation of laws that seem to have sprung up out of nowhere in 2012 and threaten to go viral in 2013. Three states (California, Illinois, and Maryland) passed laws preventing employers from accessing their employees’ Facebook accounts (and other social media sites). This trend will likely continue so expect the spread of this law in 2013.

Employers need to be aware of the use of social media in the workplace. At the very minimum, eliminate any employee expectations of privacy for personal social media activity on company computers. As a proactive measure, and particularly If you are concerned about social media use in your company, it may be time for a social media workplace policy.

Response to Natural Disasters Hurricane Sandy created the most havoc our country has seen since Hurricane Katrina in 2005 and served as a preparedness wake up call for employers. As a small business owner, any disaster can be devastating and most small business do not properly plan and prepare for disaster situations. According to the Institute for Business and Home Safety, an estimated 25 percent of businesses do not reopen following a major disaster. If you have not done so, make it a priority to:

• Preserve your data by utilizing cloud computing.• Maintain redundant data storage; maintain crucial

documents at an alternative location for protection, avoiding a location close to your business.

• Adhere to retention guidelines for materials such as tax

returns, business filings, and other financial documents. • Ensure that your key vendors have adequate

processes to ensure uninterrupted service in the event of extreme weather or other unforeseen circumstances.

Unemployment Discrimination Laws Can you be sued because you chose not hire someone who is unemployed? It will become increasingly possible as jurisdictions follow the leads of New Jersey, Oregon, and Washington D.C. who all passed new laws prohibiting some form of unemployment discrimination in 2012. All in all, seventeen states considered this type of law in 2012, so you can expect the list to grow in 2013. In the meantime, do not disqualify candidates because they do not currently have a job.

Medical Marijuana Laws These laws are spreading across the country adding Connecticut and Massachusetts in 2012. There are now 18 states with some form of legislation allowing medicinal marijuana, and while most employers are offered some level of protection through rule or court decision, the laws create some sticky situations. Expect to see more states added to this list in 2013. If the law goes into effect in your state, at the very least, small business policies regarding drug testing will need rewriting if management wishes to demonstrate empathy. For employees who are under medical supervision and prescribed marijuana for medicinal reasons, it wouldn’t be fair to maintain the same harsh, zero-tolerance positions.

Continued on page 22

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Cyber FraudSmall businesses are particularly vulnerable to cyber fraud as they may lack the resources to implement sophisticated security measures. Federal anti-cyber fraud legislation is a distinct possibility to better protect the nation’s critical infrastructure against hackers and other criminals. Many states are also likely to further expand/strengthen regulations requiring businesses to employ adequate security over confidential personal and medical information.

While there are numerous technological steps small businesses can take to better secure their environments and IT infrastructure, controls alone are not effective in combating cyber fraud. Small business owners must also take steps to create a “culture of security” among both their employees and customers.

Below are five technological and cultural adjustments you can make to better defend your company against the myriad threats posed by cyber crime.

• Perform a Risk Assessment: Analyze online and operating systems to determine the areas most at risk. For example, is your customer data, internal accounting information, and other sensitive data linked to the Internet? As part of this risk assessment, you should ensure that updated anti-virus programs, anti-spyware programs, and firewalls are installed on all computers and that employees are required to change their passwords every 60 to 70 days.

• Back-Up Critical Information: Establish a schedule to perform critical data backups and system upgrades on a regular basis throughout the year. Creating back-ups on a regular basis ensures that critical data is not lost in the event of a cyber attack or natural disaster. Store all backup copies in remote locations away from the office, such as on an external hard drive, and encrypt any sensitive data about company or customers.

• Develop a Contingency Plan: Draft a contingency plan to follow if the business suffers a cyber attack. This plan should include steps on how to continue business operations at an alternate location when necessary. Be sure to test the plan annually.

• Educate Employees: In order to create a culture of security, you must demonstrate to employees and customers that cyber fraud is a concern you take seriously. This involves educating employees and training them on proper internet practices and technology solutions, as well as encouraging customers to protect themselves against cyber fraud.

• Implement a Security Agreement: Require employees to sign a security agreement to demonstrate that they are active participants in helping to maintain a secure online environment. This agreement should also require employees to report any suspicious online activity or known internet crime to the proper authorities.

Conclusion The legal and regulatory environment is always changing.

Keeping abreast of updates and making a good faith effort to keep compliant is essential. Knowing the trends and areas of focus by regulatory bodies can help you proactively address high risk areas for your business. Remember to round out your compliance plan by checking with the states where you do business for additional changes in employment laws and regulations. Be sure to work with an employment attorney as this article does not constitute legal advice. Always seek counsel from a local HR professional to help navigate situations and to help develop new policies and practices.

This content was developed for the PHCC Educational Foundation by TPO, Inc. (www.tpo-inc.com). Please consult your HR professional or attorney for further advice, as laws may differ in each state. Laws continue to evolve; the information presented is as of November 2012. Any omission or inclusion of incorrect data is unintentional. Please note this article is not intended to provide legal advice or to substitute for supervisor employment law training.

The PHCC Educational Foundation, a partnership of contractors, manufacturers and wholesalers was founded in 1987 to serve the plumbing-heating-cooling industry by preparing contractors and their employees to meet the challenges of a constantly changing marketplace. If you found this article helpful, please consider supporting the Foundation by making a contribution at http://www.phccfoundation.org.

Continued from page 19

American Made ★ American Owned ★ Wholesale Only

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©2012, Bradford White Corporation. All rights reserved.

Bradford White MeansAmerican Jobs

Scan here to see a message from the employees of Bradford White Water Heaters.

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www.bradfordwhite.com

With no bailouts or special favors needed, Bradford White continues to invest in the future of America. We have you, the professional installer and wholesale distributor to thank for it. Because of your support,we remain an American-Owned company providing American-Made products through WholesaleDistribution for Professional Installation.

These ideas work. With the help of a high quality product and practical innovation, we’re building for thefuture. As proof of this, Bradford White Corporation is growing.

In Middleville, MI, we’ve modernized systems and equipment throughout the Bradford White factory. New construction projects include a 100,000 sq. ft. expansion and a 18,000 sq. ft. state-of-the-art trainingfacility. Our subsidiaries are growing as well. Laars Heating Systems added a new customer trainingcenter and additional factory space while Niles Steel Tank increased capacity with investment in processequipment and tank lining technology.

It all means more American jobs. Of all our innovations, that may be the most important of all.

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