The IRS has released new regulations that require all employers, including religious organizations and charities, to conduct non-discrimination testing of their employees. The stated purpose of these regulations is to protect against discrimination based on race, color, national origin, age (40 or over), religion or disability.
The regulation states that an employer must make reasonable accommodations for an employee's religious beliefs unless the accommodation would "substantially impair the ability of the person to do the job." The regulation also requires an employer to provide a written notice explaining its rights and responsibilities under this regulation. You can get more information about FSA non-discrimination testing by browsing various online resources.
There are a few important things to note about these new regulations:
1. They only apply to employers with more than 50 employees. This is likely because the IRS doesn't want religious organizations and charities feeling obligated to make changes that would significantly impact their operations.
2. The accommodation process is going to be complicated for employers. The regulation requires an employer first try to resolve the issue through informal means before filing a complaint with EEOC or other enforcement agencies. If that fails, then the employer must provide a written notice outlining its rights and what steps it will take if the accommodation isn't met.
3. It's important for employers to understand that these regulations don't create any new legal obligations; they're just clarifying existing law. So if your organization currently has non-discrimination policies in place, you'll still be in compliance with these new regulations.