New Jersey Limited Liability Company Laws Undergo Major Revision

A new set of laws governing New Jersey limited liability companies will become effective March 2013.

The changes are profound.  The Limited Liability Company Act fundamentally changes the manner in which limited liability companies are organized and managed.

This is one of the most significant pieces of business legislation in a number of years.  Beginning in 2013, the default rules a New Jersey limited liability company are going to be much more like partnerships and the rules for starting and running a limited liability company are going to change drastically.  Every New Jersey limited liability company will be affected by the changes in the law and the principals of these businesses should begin to consider how they will address the revisions. 

The reason why the changes are so sweeping is that the legislature scrapped the existing Limited Liability Company Act that was modeled largely on the LLC law of Delaware in favor of the Revised Uniform Limited Liability Company Act (RULLCA), a model statute prepared by Uniform Law Commission.  

Most significantly, for NJECPAC members, the RULLCA is very different from what is existing now.  There are so many changes we can not cover them all in one post.  The changes will have to analyzed over the next few months. The new law takes effect in March 2013 for newly formed LLCs and in March 2014 for existing LLCs. 

The more basic changes include the following:

Oral Operating Agreement.  The new statute permits operating agreements be formed by oral agreements or conduct. 

New Remedies.  The new statute contains a provision that permits a forced sale of an interest in the event of oppressive behavior.  But the statute goes a bit further authority the court to compel sales of interests when necessary in the interests of equity.

Revised Duties Among Members.  Limited liability companies members were free to structure the rights and obligations of the members as they saw fit.  The new law expressly defines the members duties and restricts the ability of the LLC to limit those duties by contract.

Distributions.  The default rule for distributions is per capita under the new law, as opposed to distributions based on the amount of capital contributed under the present law.

The Uniform Limited Liability Company Act has not been widely accepted.  Of the major "commercial states," it has now been adopted only in California, Illinois and New Jersey. For businesses operating as LLCs, it is a new world with new rules. Learn More Here

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Study Confirms Most Employers Plan To Keep Health Coverage

The latest health care survey conducted by consulting firm Towers Watson has found that the vast majority (88%) of the 440 midsize to large companies surveyed claimed that they had no plans to drop health care coverage in the near future. Among other findings, the Towers Watson survey noted that employers did plan to take a number of steps to control projected health care cost increases and to avoid having to pay the 40% excise tax on high cost (“Cadillac”) health plans in 2018. A majority of employers (58%) expect that they will trigger the excise tax in 2018 if they do not make changes to their current benefit strategy. As a result, 83% of employers are planning to take steps to control their costs to avoid the tax.

Notable survey results include the following:

• The number of employers stating that they would continue providing health coverage for their active employees increased 17% over last year’s survey.
• More than three-quarters (77%) view health care benefits as core to their employee value proposition over the next several years, and more than one-third of companies will examine their health care benefits in a total rewards framework by 2013.
• The cost of providing health coverage is projected to increase by 5.3% in 2013, down from the 5.9% projected increase for 2012.
• The total cost of providing coverage is estimated to be $11,507 per employee in 2013.
• To control costs, responding employers claimed that they will either adopt or continue to provide account-based health plans (ABHPs), which are plans “with a deductible offered together with a personal account (health savings account or health reimbursement arrangement) that can be used to pay a portion of the medical expense not paid by the plan.” According to the survey, by the year 2015, 80% of employers intend to offer an ABHP, up from 61% in 2013.
• Companies are also considering other steps to reduce costs, including changing plan options (63%), significantly reducing subsidization of coverage for spouses and dependents (38%), and using spousal waivers or surcharges (29%). Additionally, 13% plan to increase their employees’ share of health care premiums in 2013 by five percentage points or more, while 42% plan to increase employees’ share by one to five percentage points.
• Seventeen percent of responding employers claimed that they plan to offer telemedicine services by the year 2013, with another 27% considering doing so by 2014 or 2015.
• A greater number of employers responded this year that they were “very likely” to discontinue sponsoring health plans for retirees in 2014 or 2015. Many employers are also considering reducing the subsidization of coverage for their employees’ spouses and dependents, and passing along a greater percentage of the increased costs to their employees.

A recently-released report issued by the Government Accountability Office (GAO) examined a number of studies on the ACA’s impact on employer-sponsored coverage. Read More Here

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Don’t Play & Pay: Navigating Employer Health Coverage Mandate

On Friday, August 31, the Internal Revenue Service (IRS) issued guidance regarding the application of the employer-sponsored health coverage mandate. Employers need to begin planning for these rules as soon as possible. While the employer coverage mandate itself does not apply until 2014, it may be necessary to begin tracking the hours of employees as soon as this October in order to facilitate compliance.

The Play or Pay Rules

The employer-sponsored health coverage mandate is designed to require non exempt employers to either provide employees with adequate and affordable health coverage or to require those employers to pay certain penalties for their failure to do so. Specifically, penalties are triggered if:

• (1) An employer fails to offer all of its “full-time employees” the opportunity to enroll in an employer-sponsored health plan; or (2) the employer-sponsored health plan offered to “full-time employees” is “unaffordable” or fails to provide “minimum value”; AND
• Any employee impacted by such a failure purchases individual health insurance coverage through a State-based or Federally-facilitated Exchange and qualifies for a subsidy.

Failure to Provide Coverage

Employers who fail to provide coverage to all of their “full-time employees” are subject to a penalty of $2,000 per year (assessed on a monthly basis) multiplied by their total “full- time employee” count. For employers that provide health coverage, the challenge with respect to this rule is identifying all of their “full-time employees”—and making sure all such employees are offered coverage. In the event that even one “full-time employee” is not offered coverage and subsequently attains subsidized coverage through an exchange, the penalty is applied to all “full-time employees.” Thus, with respect to any employees who do receive employer-sponsored coverage, the employer could end up “playing” and “paying.” Read More Here

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Do At-Will Employment Disclaimers Violate The NLRA?

This summer the National Labor Relations Board (NLRB) has taken the position that commonly used at‑will employment disclaimers could be a violation of the National Labor Relations Act (NLRA). Section 7 of the NLRA guarantees employees the right to engage in “concerted activities for the purposes of collective bargaining or other mutual aid or protection.” The NLRB’s recent actions continue a trend of stringent enforcement of employee’s Section 7 rights that many times brings non‑union employers within the jurisdiction of the NLRB.

Labor law is rapidly changing and the NLRB has drastically increased its activity. Specifically, the NLRB is finding more and more ways in which they believe an employer’s actions or policies violates an employee’s rights to concerted activity under Section 7 of the NLRA. Accordingly, employers should pay close attention and monitor these types of enforcement actions. 

Read More Here 

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Congress Votes to Extend E-Verify for Three More Years

E-Verify is an Internet-based, free program run by the United States Government that compares information from an employee's Employment Eligibility Verification Form I-9 to data from U.S. government records. If the information matches, that employee is eligible to work in the United States.

E-Verify was to expire in March 2009, lawmakers began working on an extension in the fall of 2008. New Jersey's Sen. Bob Menendez refused to lift a hold he placed on the extension without a massive increase in green cards, so Congress put the E-Verify extension on the shelf until the spring.

Neither action was about mandating E-Verify for all employers. But for the government to be allowed to offer E-Verify for voluntary use, the extensions had to be passed in 2009 and again this month.

The House of Representatives has now approved the extension of E-Verify for another 3 years. The electronic employment verification program, which could have big impact in ending the flow of illegal immigration to the United States, is set to expire at the end of the month, but, now that it's passed through both chambers of Congress, we fully expect Pres. Obama to sign the extension into law. Read More Here

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Bill Would Change How Businesses Sell Their Scrap Metals

ASSEMBLY, No. 3222  

STATE OF NEW JERSEY 

215th LEGISLATURE 

This bill, which amends P.L.2009, c.8 (C.45:28-1 et seq.), requires scrap metal businesses to maintain, for at least five years, a record of all receipts or purchases of scrap metal, instead of only for those purchases in excess of 100 pounds or $50, as currently provided by law.  This bill also requires that scrap metal businesses make payment to any person delivering or selling scrap metal only by non-transferable check made payable to that person, to be mailed to an address provided by that person as required pursuant to existing law. 

The bill requires scrap metal businesses to send copies of all records maintained pursuant to law to the appropriate law enforcement agency at the close of each business day.  Under the bill, scrap metal businesses may accept delivery of scrap metal by motor vehicle only, and must record the license plate number of any motor vehicle which is used to deliver scrap metal. 

One problem NJECPAC has identified is that if passed an employer that sends their employee to the scap yard would not receive payment for their scrap. Their employee would receive a check via us mail for the employers scrap. NJECPAC Board of Governors sees this as a major flaw in the legislation and will be seeking an amendment from the Legislature addressing this and any other issues that the Board identifies with this legislation. 

View Legislation Here

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Senate Bill S2116 Would Grant Reciprocity Of All Professional Licenses

SENATE, No. 2116 

STATE OF NEW JERSEY

215th LEGISLATURE

Senate Bill S2116 would grant reciprocity of all of New Jersey's Professional licenses to Licensees of other states was reviewed by NJECPAC. The Legislature subsequently amended the Bill addressing the concerns provided by NJECPAC.

The original bill would have granted reciprocity to out of state contractors to work in NJ but did not grant reciprocity to NJ Contractors to work in other states

The bill as Amended would exempt the Board of Examiners of Electrical Contractors from the provisions contained within S2116. Assembly Bill A1545 is identical to the Senate Version. View Legislation Here.

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Governor and NJ Democrats Disagree On Success of Property Tax Cap

Governor Chris Christie says the 2% Property Tax Cap is working while the States Democrats are claiming it is an egregious failure

The Truth is that Democrats led by Senate President Steve Sweeney soundly rejected Governor Christie's plan for a flat 3% Cap that contained no loopholes. They then substituted their own 2% cap with various loopholes for Schools and Municipalities that they ultimately passed and sent to the Governor

Of course the Governor did sign the bill, so his name is indeed on it. We believe the Governor signed the slightly flawed Bill because he believed that if he did not compromise there would have been no Property Tax Relief at all. 

Now some are claiming the cap is an egregious failure. For purely political reasons those that are making that claim think the electorate will believe that it is all Chris Christie's Fault........


Although not perfect, what was passed was a compromise between the Governor and the States Democrats which gave some property tax relief, There is still room for more work to be done by both Parties to help Municipalities manage their affairs and provide services to Property tax payers including Small Businesses without raising taxes by eliminating waste that still exists around every corner. 

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Don't Miss Our 2012 Summer Networking Event

Missed Our 2011 Summer Fun Family Picnic?

 

There is Still Time To Register For Our July 19, 2012 Event

Email Us that you will be attending, njecpac@comcast.net

Bring Your Check to the Event, And See Us At The Gate For Your Ticket 

       Join Us For An Evening Of Summer Family Fun

July 19, 2012 6:00PM

Bring Your Family, Friends, Colleagues, Neighbors & Clients

The Picnic Packages Includes All Of These GREAT Features!

• Ticket to the game
• Private picnic area for the whole game, with your OWN party host.
• Complete BBQ grill for approx. 90 minutes featuring delicious baseball fare. ~ Hot dogs, Hamburgers, Cheeseburgers, Grilled Chicken, Pasta Salad, Chips, Cookies, and more!
• Unlimited Draft Beer, Soda and Bottled Water until the 7^th Inning
• 10% discount coupon for the Strike Zone gift shop.
• Group recognition during the game.

Adults:                $60.00

Children:            $30.00

Corporate, Association, and Individual Sponsorships

Are Also Available

 

For more information,

please contact: 

Joe Coviello - 201-410-5487 or

Email the NJECPAC at njecpac@comcast.net

Access Registration Here

                                                    

  NJECPAC ~  P.O. Box 196
Fords, NJ 08863

Event proceeds will help to provide funding for Legislative Initiatives for the Electrical Industry

 and Small Business throughout New Jersey.

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New Lamp Regulations Now In Effect

On Saturday July 14th, many popular lamps are no longer being manufactured due to changes in legislation standards. More Here


Visit Philips Lighting to use their interactive lamp replacement tool and to learn about the impact this change has on your lighting options. 


Between 2005 and 2009, fluorescent ballast regulations imposed by the U.S. Department of Energy (DOE) became effective in phases, limiting availability of T12 magnetic ballasts in new fixtures. In July 2010, the final phase of these regulations went into effect, virtually eliminating fluorescent F40T12, F96T12 and F96T12HO magnetic ballasts from the market. This includes both full wattage and energy saving versions (e.g., ballasts for 34W T12 lamps) as well as replacement ballasts—with few exceptions. 

The final nail has come in 2012. New DOE fluorescent lamp regulations are taking effect, strengthening standards for lamp types covered by previous regulation while also covering 8' T8, 4' T5, along with more wattages of 4' T8 and T12 lamps. The net result, with few exceptions, is that a majority of 4' linear and 2' U-shaped T12, many 8' T12 and T12HO, and some low color rendering 4' T8 lamps are being eliminated.

Missed Our 2011 Summer Fun Family Picnic?

 Don’t Miss The Fun in 2012

       Join Us For An Evening Of Summer Family Fun

July 19, 2012 6:00PM


View Event And Registration Info Here

     
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