An AARP study found that 47% of American workers in 2022 were employed by a business that does not offer any type of retirement plan. They also found that Americans are 15 times more likely to save for retirement when they have a workplace plan and 20 times, when the contributions are automatic. With such a low rate of employees saving for their retirement, many states are looking at closing that gap through state-facilitated programs and mandating employers in their state to offer a retirement plan. If you are an employer who does not have a retirement plan, such as…
Posts published in “Employee Management”
Overtime is a comprehensive subject, covering everything from employee eligibility to the calculation of compensation. This article will focus specifically on states with laws that differ from the federal Fair Labor Standards Act (FLSA). For employees in states not listed below, overtime calculation generally follows the federal FLSA standard. Overtime is triggered when an employee works more than 40 hours in a continuous seven-day workweek, and the required premium pay rate is one and one-half times the employee’s regular rate of pay. It is important to remember that the FLSA provides certain exemptions, such as those for agricultural workers and…
Restaurants face special rules for payroll, wages and tips that set them apart from most other businesses. In few industries do customers directly help pay employee wages through tips. These rules come mainly from the federal Fair Labor Standards Act (FLSA) and state laws, and can lead to common compliance issues, if not handled carefully. Minimum wage – While the federal minimum wage is $7.25 per hour, for tipped employees who engage in an occupation in which they customarily and regularly receive more than $30 per month in tips, their minimum wage is only $2.13 per hour in direct wages,…
Immigration and Customs Enforcement (ICE) was created in 2003, as part of the newly formed Department of Homeland Security (DHS,) following the September 11 attacks. The agency combined the enforcement and investigative branches of two older agencies: Immigration and Naturalization Service (INS,) which handled immigration matters and the U.S. Customs Service, which focused on border and trade enforcement. The goal was to strengthen national security by bringing immigration and customs enforcement under one roof. Today, one of ICE’s key responsibilities is ensuring that employers follow federal rules on verifying work eligibility through I-9 audits and, when necessary, workplace enforcement actions.…
The SECURE 2.0 Act of 2022 was designed to enhance retirement savings for Americans by making it easier and more affordable to save. Each year, since the signing of this act, we have seen plan rules change, and 2026 will mark another key change in how catch-up contributions will be handled for high wage earners. The current rules state that if you are aged 50 or over, at any point during the calendar year, you can contribute an additional $7,500 on top of the regular contribution limit. The latter is also known as a catch-up contribution. For 2025, the regular…
Imagine this: You’re a small business owner in a quaint coastal town, hiring for a key position. You dot your i’s and cross your t’s, running the candidate through the government’s own verification system. It comes back clean—authorized to work. You breathe a sigh of relief, thinking you’ve covered all your bases. Then, bam! Federal agents show up and it turns out your new hire wasn’t eligible after all. Sounds like a nightmare? Well, it happened in real life, and it’s a wake-up call for anyone relying on E-Verify to stay on the right side of the law. In this…
Many businesses are leaving valuable payroll tax credits unclaimed, missing out on significant financial benefits. Programs like the Work Opportunity Tax Credit (WOTC), Federal Empowerment Zone (FEZ) Credits and Research and Development (R&D) credit offer substantial savings, yet they often go overlooked due to lack of awareness or resources. Here’s a closer look at these credits and how your business can capitalize on them: Work Opportunity Tax Credit (WOTC) Since its introduction in 1996, the WOTC incentivizes hiring from specific groups, such as veterans, long-term unemployed and individuals receiving government assistance. The Department of Labor estimates that one in five…
Currently, there is no federal law guaranteeing even one day of paid sick leave to workers, with the exception of federal contractors and government employees. There is the Family Medical Leave Act, but that simply provides the ability to take unpaid job-protected leave for specified family and medical reasons. There was an attempt back in 2016, where President Obama called on Congress to pass the Health Families Act which would have expanded sick leave to all private-sector workers, but it did not pass the House. Since that time, states and localities have taken action to provide all workers, within their…
Compensatory time, or “comp time,” is an alternative to overtime pay where employees receive paid time off instead of extra wages for overtime hours worked. But, not so fast. While this may seem like a useful tool for managing labor costs and scheduling, its legality depends on the type of business and the classification of employees. Employers must understand the rules before offering comp time to avoid legal issues. The legality of comp time depends on whether an employer operates in the public or private sector: Public-Sector Employers: Under certain prescribed conditions, employees of state and local government agencies are…
Paid Time Off, including Sick, Vacation, and the like policies, are an essential employee benefit, allowing workers to take time off while still receiving compensation. Many employers also offer PTO cash-out options where employees can receive payment for unused leave. However, these policies must be carefully structured to avoid unintended tax consequences under the IRS constructive receipt doctrine. If improperly designed, a PTO cash-out policy could result in employees being taxed on income they never actually received. This article explains how constructive receipt applies to PTO payouts and outlines strategies employers can use to structure PTO policies in a tax-compliant…