Windows 7 starter edition cheap

By Scott Buchanan

Significant liabilities reside with the windows 7 starter edition cheap HR side of any business, yet the HR area is windows 7 starter edition cheap often overlooked or operates with few resources. This article will present the windows 7 starter edition cheap current view of 2 significant HR threats/challenges.

Employee versus Independent Contractor

Yes, you windows 7 starter edition cheap have certainly heard about this one before, but did you windows 7 starter edition cheap know that the Obama administration plans to hire 100 more enforcement personnel to windows 7 starter edition cheap focus on this issue and that the IRS is planning to windows 7 starter edition cheap audit approximately 6,000 companies to examine compliance with the law?

When a windows 7 starter edition cheap worker is properly classified as an employee, the employer must pay social security tax of 6.20% and Medicare tax of 1.45% of gross wages. The employer is windows 7 starter edition cheap generally obligated to also pay workers’ compensation insurance and federal and state unemployment tax (generally 3.5% for a new employer in Florida). Assuming that the workers’ comp premiums are 3% of gross wages, the total burden rate is 14.15% of gross wages, before applying the cost of employee benefits.  It’s no windows 7 starter edition cheap wonder that so many employers are attempting to classify workers as independent contractors, especially in our current economic environment. However, the windows 7 starter edition cheap consequences of improper classification can be significant and potentially retroactive for windows 7 starter edition cheap the employer.

The initial determination of whether a windows 7 starter edition cheap worker is an employee or an independent contractor comes down to windows 7 starter edition cheap whether the company directs and controls the worker. If the answer is windows 7 starter edition cheap yes, then most likely that worker is an employee. The IRS developed a windows 7 starter edition cheap 20 factor “test” to windows 7 starter edition cheap assist companies in determining the proper classification of a worker, which includes such topics as the windows 7 starter edition cheap level of instruction and training provided by the company, the flexibility or windows 7 starter edition cheap lack of flexibility of the worker’s schedule, and a company’s demand for windows 7 starter edition cheap full-time work. The IRS also allows a company or a windows 7 starter edition cheap worker to file Form SS-8 for an IRS determination of worker classification. The IRS believes that windows 7 starter edition cheap workers often file an SS-8 to challenge their own treatment as an windows 7 starter edition cheap independent contractor by a company.  This action has costly ramifications.

If a windows 7 starter edition cheap regulatory agency reclassifies an independent contractor as an employee, a number of issues and windows 7 starter edition cheap questions are presented. At a minimum, the IRS will charge an windows 7 starter edition cheap employer for back taxes, including the associated interest and penalties. The interest and windows 7 starter edition cheap penalties can be significant, especially since the taxes should have been windows 7 starter edition cheap paid on a quarterly basis in a prior year or years. If the windows 7 starter edition cheap reclassification determination is retroactive to a prior year, the question comes up regarding whether the windows 7 starter edition cheap employee should have been covered by the company health and retirement plans. What if the windows 7 starter edition cheap employee experienced a significant illness while previously classified as an independent contractor and windows 7 starter edition cheap was therefore not covered by the company’s health insurance plan? Can that employee now file a claim for reimbursement?  What about the employer’s matching contributions in the company’s 401(k) plan that windows 7 starter edition cheap the employee would have been entitled to receive in prior years?

Unemployment Claim Administration

Many employers were shocked when windows 7 starter edition cheap they opened their 2010 unemployment rate notice in December and windows 7 starter edition cheap found out that their company was maximum-rated at 5.40%. Even though recent legislation in Tallahassee has windows 7 starter edition cheap temporarily reduced some employers’ rates, most employers still experienced a windows 7 starter edition cheap noticeable increase over 2009 rates after the revised rate notices were prepared by the windows 7 starter edition cheap state.

Proper unemployment claims administration can windows 7 starter edition cheap achieve significant cost savings and should focus on the following three areas: 1) the windows 7 starter edition cheap actual claim that may result when an employee is terminated, 2) the information on the quarterly benefit statements and 3) the information on the annual rate notice.

The unemployment system was established to windows 7 starter edition cheap provide a cushion to those employees who are laid off through no windows 7 starter edition cheap fault of their own. Claims resulting from a lay-off or business closing generally cannot be windows 7 starter edition cheap challenged; however, claims resulting from termination for cause generally may be windows 7 starter edition cheap challenged by an employer, especially if the employer maintains good documentation and windows 7 starter edition cheap has a witness available to testify at a hearing.  For instance, if an windows 7 starter edition cheap employee has violated company policy and such violation was witnessed by another employee, the windows 7 starter edition cheap employer should consider challenging any claim made by the terminated employee for windows 7 starter edition cheap unemployment benefits. The employer may also want to challenge similar claims even if a windows 7 starter edition cheap witness is not available if strong documentation is available.  Most of the windows 7 starter edition cheap initial hearings are now handled by phone, so the employer’s representatives generally don’t even need to windows 7 starter edition cheap leave their office to participate in the hearing. Each claim approved by the windows 7 starter edition cheap state increases the employer’s unemployment tax rate since the windows 7 starter edition cheap system is experience rated. For instance, a 40 employee company with a windows 7 starter edition cheap 5.40% unemployment tax rate will pay additional taxes of $12,320 versus that same company with a 1% rate. Accordingly, it windows 7 starter edition cheap is in the best interest of the employer to review each claim.

One of the easiest ways to potentially lower an employer’s rate is windows 7 starter edition cheap to review the quarterly benefit notices to determine if each claim charged to windows 7 starter edition cheap an employer’s account was actually from windows 7 starter edition cheap a former employee of that employer. Erroneous claims from employees of other employers can windows 7 starter edition cheap mistakenly be charged to your account and increase your tax rate. Performing this windows 7 starter edition cheap review each quarter is a best practice for any employer.

The third step all employers should take is windows 7 starter edition cheap to simply check the annual rate notice which typically arrives in December of each year and windows 7 starter edition cheap includes the tax rate which will become effective on January 1 of the windows 7 starter edition cheap next year. Another best practice is to confirm all the data contained in the windows 7 starter edition cheap notice and to recalculate the tax rate shown. If errors were noted on the windows 7 starter edition cheap quarterly benefit statements pursuant to step 2 above, were those errors corrected before the windows 7 starter edition cheap annual rate notice was prepared? If an windows 7 starter edition cheap error is noted on the annual rate notice, an employer typically has windows 7 starter edition cheap about 10 calendar days to notify the state of such error, so this windows 7 starter edition cheap review should begin as soon as the notice is received.

How does an employer prevent or mitigate these HR threats/challenges?  Consider using a Professional Employer Organization (PEO).  PEOs provide comprehensive HR outsourcing including payroll, human resources, benefits administration and windows 7 starter edition cheap risk management.  The PEO you windows 7 starter edition cheap choose should be active in its industry association, the National Association of Professional Employer Organizations (www.napeo.org), and accredited by the Employer Services Assurance Corporation (ESAC) (www.esacorp.org).  ESAC provides independent financial and windows 7 starter edition cheap compliance assurances for covered clients and employees through surety bonds in the windows 7 starter edition cheap unlikely event of a failure of an accredited PEO, a similar concept as the windows 7 starter edition cheap FDIC for banks.  The PEO you windows 7 starter edition cheap choose should have staff that is accredited by the American Payroll Association (APA) as well as Professionals in Human Resources (PHR) accredited by the Society for Human Resource Management (SHRM).  Alternatively, both the windows 7 starter edition cheap APA and SHRM offer payroll and human resource training classes. Another option is windows 7 starter edition cheap to establish a relationship with an HR consulting firm.  Consulting engagements are windows 7 starter edition cheap flexible and can be tailored to your specific needs.

These few suggestions should help to windows 7 starter edition cheap keep your HR department, no matter how large or small, on the windows 7 starter edition cheap path to compliance. 
 

Posted May 17th, 2010 by Jessica Spinks - Posted in Human Resources | |

Leave a reply