The Latest News on Economic Crisis, Employee Privacy and New Opportunities
The COVID-19 Economic Crisis May Worsen the Retirement Crisis
The Coronavirus Aid, Relief, and Economic Security (CARES) Act, which became law on March 27, 2020, added some mandatory and additional provisions affecting employer-sponsored retirement plans trying to alleviate the financial pain of the COVID-19 pandemic.
The CARES law permits the distribution of up to $ 100,000 by December 31, 2020 from most defined contribution plans as a result of COVID-19, even if the participant does not meet the usual rules for sharing difficulties. The participant must confirm that he, his spouse or one of his dependents gave a positive result on COVID-19 or had adverse financial consequences as a result of COVID-19.
Distribution of the CARES Act is not subject to mandatory withholding tax or a 10 percent penalty, even if a participant is younger than 59 1/2. Participants can repay the plan distribution for three years without tax.
Participants can get loans in the amount of up to 100,000 US dollars (or 100 percent of their account balance in the plan, if less) until September 28, 2020 due to coronavirus. Moreover, all payments payable in 2020 for loans that are currently not repaid in accordance with the plan, and new loans taken for the remainder of 2020, may be suspended for a year, so all payments will be deferred as at least until 2021.
Other Retirement Plan Provisions
The CARES also repeals the minimum required distribution requirements that apply to defined contribution plans (not defined benefit plans) and IRAs for the 2020 plan year. This permits participants to deposit funds in their accounts for an additional year to restore investment markets before the next distribution.
The CARES Act is a considerable part of federal law (880 pages), which was developed and adopted a little over a week. The provisions on the retirement plan of the CARES Act will provide long-awaited relief for employers and workers during urgent need. But the provisions of the pension plan pose a number of questions and problems.
Employee Privacy during COVID-19
The confidentiality of the employee is not new, and there is consistent guidance on what (the basic level) is possible and what is not. What data can you process when an employee calls in sick and what you can and cannot ask?
Indian Privacy Act currently only recognizes and protects certain limited information, such as confidential personal data or information (SPDI). SPDI includes, in particular, “physical, physiological and mental health conditions” and “medical records and medical history”. Accordingly, health status and medical symptoms will be protected, and the employee may also refuse to disclose such information.
Vikram Shroff, Head of the HR Law (Employment and Labour) practice at Nishith Desai Associates shares, “The employer will need to comply with the relevant provisions while obtaining, storing, processing and transferring any SPDI of the employees. On the other hand, travel plans and history, non-work activities, etc. are not protected by Indian privacy laws and hence can be asked by the employer without worrying from a privacy standpoint.”
India is currently considering a privacy law similar to the GDPR, which, once it enters into force, will provide comprehensive protection for workers regarding their health and medical information.
Restrictions on the collection, processing or dissemination of data to eliminate the risks of COVID-19
Data must be held securely and only be used for legitimate purposes to prevent the spread of the virus
Although there are no specific confidentiality restrictions on the COVID-19 outbreak, medical records and employee history are protected by Indian privacy laws. In this case, the employer will have to comply with the relevant provisions of the law in the case of an employee suspected or affected by COVID-19. In addition, the employer will need to consider such information as strictly confidential. However, this should not prevent the employer as a whole from disseminating any information related to COVID-19 among its employees, if it is not publicly available.
Information that companies can collect from third parties and from open sources about employee health
The employee’s medical records and history are protected under Indian Data Privacy Act, whether it was obtained directly from the employee or a third party such as a hospital or medical practitioner. However, the Data Privacy Act does not protect information available in open sources such as the public domain.
New Opportunities due to Working from Home
Today, more than 70% of people worldwide work from home, and some corporations are forced to ask people to work from home. Some systems are already creaking around the edges, and some trust banks are running out. In such a crisis, the path between corporate failure and layoffs is often short.
For many corporations, it would be nice to realize that people can work from home remotely. Some corporations would recognize the significance of their Chartered “Values”, which they have cited for decades. Some organizations might abandon their values in this difficult time. Today, all generation leaders realized that micro-management was the wrong bet. It is all about making feels accountable and they all show up with good intentions. The time has come to ground the expectations, in the reality of the work.
Post COVID-19 world
Employees would miss their office surely. People would love coming to the office. Wiser corporate may rethink the decision of office space and control. They would start believing that with a bit of more effort on communication, work can happen remotely too. Some corporate would also try to match up with the Loss on this with layoff or pay cut later. Crime rates may go up in need of work & money in some section of society. The business would get more innovative and so as people, the competition would further deepen. This journey is going to be a myth spoiler and travel all the way to enlightenment.
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