Are You on Track?
As a small business employer, time is always in short supply. It is difficult, with all of the other pressing issues, to focus valuable time on the details of labor law compliance. While most employers follow most of the rules quite easily without much attention or thought, the devil is in the details. Although at first glance, there might not be any gross violations, have you made some missteps? For example:
1. Do you have an inside sales person who receives a salary instead of hourly pay?
2. Did you provide an intern that you hired last summer with a 1099 instead of a W2?
3. Did you instruct the last person that you hired to bring in their Drivers License and Social Security Card in order to complete the I-9 form?
4. Do your personnel files contain employee's health insurance applications?
If you answered 'Yes' to any of these questions, you may have committed a compliance violation. In April of this year, the Department of Labor announced its "Plan/Prevent/Protect" enforcement strategy. According to their statement,"Employers and others in the department's regulated communities must understand that the burden is on them to obey the law, not on the Labor Department to catch them violating the law." An article published by SHRM [Society for Human Resource Management] provides some additional details about this issue. Click Here for Full Article.
"Deputy Labor Secretary Seth Harris described the new initiative as an effort by the DOL to foster a culture of compliance among employers to replace what he described as a 'catch me if you can' system. This system, according to Harris, involves some employers depending 'on luck or coincidence to avoid the violations of workers' rights or, perhaps worse, they make a calculated decision whether to comply with employment laws. They assess the benefits of refusing to comply with the law and compare them to the costs of complying with the law. Then, they weigh these costs and benefits against the likelihood they will be caught and the penalty they might suffer if they are caught.'
The new enforcement strategy will require, in various ways, employers and other regulated entities to assemble plans, create processes, and designate people charged with achieving compliance. No longer will businesses have the luxury of waiting until a potential problem arises to address and resolve the issue. Employers instead would have to develop, implement, and enforce policies that are designed to eliminate, not merely mitigate, employment, safety, and employee benefit law violations."
So what is an employer to do?
1. Find an Employment Expert who can provide ongoing advice and direction BEFORE something goes wrong. Once a problem escalates, you'll need an attorney, and THAT gets expensive.
2. Review your Employee Handbook and make sure you are operating according to its rules. If you don't have one, GET ONE!
Other aspects of running your business might keep you up at night, but employment compliance shouldn't. With some professional help and good vendor relationships, its easy to get on track and to stay there. If you need assistance, and don't feel comfortable with your current employment practices, call me. I would welcome the opportunity to help.
Sandra Teague, SPHR
|Navigating Unemployment Notices|If you missed it, Click Here to see a copy of the letter from IDES. The Illinois Department of Employment Security recently announced that they will be sending out more correspondence to employers. We receive many questions about these notices already, and additional communication is likely to add to the confusion. It is very important to review these notices. Although many can be ignored, some are critical and require a very timely response. Quarterly Benefit Charge Statements should also be reviewed. Errors on these statements can be appealed and corrected, but again, there are deadlines required for response. Allowing incorrect benefit charges to remain on your account will ultimately raise your SUTA tax rate and can cost thousands or even tens of thousands of dollars in extra taxes each year. Since the tax rate is based on the last three years of benefit charges, it can take a long time before the tax rate will come back down.
|Delayed Vacation Pay is
"Wage Theft" Under Illinois Law
To talk about your record keeping procedures and ways to improve it, contact Sandra Teague. To read the Press Release from the State of Illinois regarding this new bill, Click Here.
When an employee is terminated, either voluntarily or involuntarily, state law requires that all final wages, unused vacation pay, commissions, and bonuses be paid no later than their next regularly scheduled pay day. On July 30th, Governor Quinn signed into law Senate Bill 3568. This legislation increases protections for Illinois workers, and increases civil and criminal penalties for employers who do not comply.
Good record keeping is key to complying with this rule. Vacation accrual and usage policies should be clearly documented in the Employee Handbook. Written records (maintained internally or with the help of your payroll processor) that track usage of time off should always be kept up to date. This makes the final calculation simple, and easy to do on time so that no wage violation occurs.
|How Advantage Employment Saves your Company Money:
- Eliminate the internal cost of an HR administrator and outsource those duties for less.
- Stop allocating high level executive time to handle sensitive or confidential HR issues. Focus on your business instead.
- Stop paying an outside payroll provider steep rates for minimal do-it-yourself service.
- Don't lose a protestable unemployment claim. Each person who gets unemployment benefits who shouldn't can cost your company $4K to $6K in increased taxes each year.
- Don't let workers comp claims malinger. Improper case management and lack of a return-to-work plan will increase the cost of the claim and increase your mod.
- Reduce your exposure to dangerous lawsuits by enlisting the help of HR professionals. Show your employees that policies are sound, and prevent trouble makers from taking advantage of a loosely run organization.
- Reduce turnover in your staff by maximizing their understanding and utilization of the employee benefits that you already provide to them.
- Increase employee loyalty by providing them a resource to solve any employment question or problem.
To view previously published newsletters, click below.
Advantage Employment, Inc.
2021 Midwest Road
Oak Brook, IL 60523