...from the HR Perspective

Human Resource Update

February 2016

Is The Well Dry?

Some recent surveys of top management have produced similar concerns. The apparent lack of talent and skills will start to hurt businesses in the near-term. This letter adds to the issues that were discussed on our December newsletter.

The need for complicated technical talent is being partially met by citizens from other countries working here on visas. Students in the U.S. have not generally pursued college degrees in the technical fields (math, engineering, science, etc.) and have concentrated on the arts and other "soft" studies. Those who do not continue onto college are generally not interested in education that will prepare them to be mechanics, electricians, machinists, etc.

What can businesses do to meet their needs? Money does not seem to be the answer although it helps recruit the talent that is available. Promoting the fields of study necessary is something that companies can do in association with universities and high schools. Making those fields attractive is another. GE has done this with its latest TV ad in which a programmer's efforts are pictured as improving life rather than just creating a flow of ones and zeros. Virgin Atlantic airlines is offering the chance of a lifetime for those who want to be pilots. If you pass the initial review, Virgin will pay the candidate to learn to fly, and possibly earn a college degree as well. Some companies have started in-house training programs.

Our vocational/technical high schools need a boost. Companies have started to create work/study and intern programs with some of these schools. Corporate sponsorship of programs within these schools is something that should be explored.

All businesses need to assess where the talent they need is going to come from. While the need to fill positions in new and expanding operations takes our immediate attention, as mentioned in our December newsletter, the Baby Boomers are starting to leave the workforce in increasing numbers and the vacancies they leave need to be filled.

We have helped organizations in manpower planning, succession planning, training and career development. Please let us know how we may help you with your challenges.

Sincerely,

Michael F. Yates

President

If you find value in this newsletter please let us know. Feel free to call me with a comment and/or ask a question at any time (908-689-4200) or send me an email (myates@mfyco.com). We offer this timely information as another benefit of your relationship with our company. If you feel a friend or colleague would benefit from receiving our newsletter, please feel free to forward a copy.

You can view all of our newsletters by clicking the 'newsletter archives' link at our company website www.mfyco.com.

In This Issue

Requesting a Determination Letter - IRS Notice 2016-3

MFYCO Facebook

Minimum Wage

Are Working Parents Burning Out?

Telecommuting For Non-exempts - Does it Work for You

Now you don't have to answer the IRS Compliance Questions on the 2015 Form 5500-Series Returns

eLaws Quick Link

2016 Retirement Plan Limits

Track Government Spending

Terms of Use

Requesting a Determination Letter - IRS Notice 2016-3

In anticipation of the elimination, effective January 1, 2017, of the 5-year remedial amendment cycle system for individually designed plans under the Employee Plans determination letter program, the IRs issued Notice 2016-3 which provides that the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) will issue guidance providing that: (1) controlled groups and affiliated service groups that have previously made a Cycle A election are permitted to submit determination letter applications during the Cycle A submission period beginning February 1, 2016, and ending January 31, 2017; (2) expiration dates on determination letters issued prior to January 4, 2016, are no longer operative; and (3) the period during which certain employers may, on or after January 1, 2016, establish or adopt a defined contribution pre-approved plan and, if permissible, apply for a determination letter, is extended from April 30, 2016, to April 30, 2017.

The changes described in Notice 2016-3 will be reflected in an update to Revenue Procedure 2007-44. Employers may rely on Notice 2016-3 until Rev. Proc. 2007-44 is updated to include these changes.

Click here to read IRS Notice 2016-3 in its entirety.

Invitation to MFYCO Facebook

Visit our page!

Minimum Wage

The minimum wage in 16 states/territories will increase during the 2016 calendar year. Two states fall below the Federal 2016 minimum wage of $7.25. The table below reflects state minimum wage increases for 2016 (increases are effective on January 1, 2016, unless otherwise indicated):

State	2016 Minimum Wage	2015 Minimum Wage	2014 Minimum Wage	Future Scheduled Increases	Indexed Automatic Annual Adjustments
Alabama	none	none	none
Alaska	$9.75	$8.75	$7.75		Indexed annual increases begin 1/1/2017.
Arizona	$8.05	$8.05	$7.90		Increased annually based on cost of living.
Arkansas	$8.00	$7.50	$6.25	$8.50 eff. 1-1-17
California	$10.00	$9.00	$9.00
Colorado	$8.31	$8.23	$8.00		Rate changes annually based on cost of living
Connecticut	$9.60	$9.15	$8.70	$10.10 eff. 1-1-17
Delaware	$8.25	$7.75	$7.75
D.C.	$11.50 (Eff. 7/1/2016)	$10.50	$9.50		Indexed increases begin 7/1/2017
Florida	$8.05	$8.05	$7.93		Annual increase based cost of living.
Georgia	$5.15	$5.15	$5.15
Guam	$8.25	$7.25	$7.25
Hawaii	$8.50	$7.75	$7.25	$9.25 eff. 1/1/17 $10.10 eff. 1/1/18
Idaho	$7.25	$7.25	$7.25
Illinois	$8.25	$8.25	$8.25
Indiana	$7.25	$7.25	$7.25
Iowa	$7.25	$7.25	$7.25
Kansas	$7.25	$7.25	$7.25
Kentucky	$7.25	$7.25	$7.25
Louisiana	None	none	none
Maine	$7.50	$7.50	$7.50
Maryland	$8.75 (Eff. 7/1/16)	$8.25	$7.25	$9.25 eff. 7-1-17 $10.10 eff. 7-1-18
Massachusetts	$10.00	$9.00	$8.00	$11.00 eff. 1-1-17
Michigan	$8.50	$8.15	$8.15	$8.90 eff. 1-1-17 $9.25 eff. 1-1-18	Annual increases take effect Jan. 1, 2019, linked to the CPI. Increases not to exceed 3.5%.
Minnesota	$9.50(Lrg ER) $7.75(Sm ER) (Eff. 8/1/16)	$9.00/$7.25	$8.00/$6.50		Indexed annual increases begin Jan. 1, 2018.
Mississippi	None	none	none
Missouri	$7.65	$7.65	$7.50		Minimum wage increased or decreased by cost of living starting Jan. 1, 2008.
Montana	$8.05/$4.00	$8.05/$4.00	$7.90/$4.00		Increases done annually based on the CPI and effective Jan. 1 of the following year.
Nebraska	$9.00	$8.00	$7.25
Nevada	$8.25/$7.25	$8.25/$7.25	$8.25/$7.25		Increases subject to the federal minimum wage and CPI. Increases take effect July 1.
New Hampshire	7.25	repealed by HB 133 (2011)	repealed by HB 133 (2011)
New Jersey	$8.38	$8.38	$8.25		Indexed annual increases based on CPI, effective Jan. 1, 2014.
New Mexico	$7.50	$7.50	$7.50
New York	$9.00 ($9.75 for Fast Food EEs)	$8.75	$8.00
North Carolina	$7.25	$7.25	$7.25
North Dakota	$7.25	$7.25	$7.25
Ohio	$8.10/$7.25	$8.10/$7.25	$7.95/$7.25		Indexed annual increases based on CPI.
Oklahoma	$7.25/$2.00	$7.25/$2.00	$7.25/$2.00
Oregon	$9.25	$9.25	$9.10		Indexed annual increases based on CPI, rounded to the nearest five cents.
Pennsylvania	$7.25	$7.25	$7.25
Puerto Rico	$7.25/$5.08	$7.25/$5.08	$7.25/$5.08
Rhode Island	$9.60	$9.00	$8.00
South Carolina	None	none	none
South Dakota	$8.55	$8.50	$7.25		Annual indexed increases begin Jan. 1, 2016.
Tennessee	none	none	none
Texas	$7.25	$7.25	$7.25
Utah	$7.25	$7.25	$7.25
Vermont	$9.60	$9.15	$8.73	$10.00 eff. 1-1-17 $10.50 eff. 1-1-18	Beginning Jan. 1, 2019, minimum wage increased annually by lesser of 5% or CPI. Note: Vermont started indexing in 2007.
Virgin Islands	$7.25/$4.30	$7.25/$4.30	$7.25/$4.30
Virginia	$7.25	$7.25	$7.25
Washington	$9.47	$9.47	$9.32		Annual indexed increases began Jan. 1, 2001.
West Virginia	$8.75	$8.00	$7.25
Wisconsin	$7.25	$7.25	$7.25
Wyoming	$5.15	$5.15	$5.15

Are Working Parents Burning Out?

A recent research report by Bright Horizons Family Solutions� has shown that many working parents feel burnt out. This means they do not feel engaged at work, are more likely to leave a company, and are less likely to apply themselves like they used to.

Many working moms and dads alike reveal that the combination of work and family responsibilities is causing anxiety and depression and is keeping them from doing their best at work. The good news is parents and managers agree on one important thing: the solution to this problem rests in the workplace.

Key findings in this new survey show:

Working parents are not speaking up in the workplace and they are leaving their managers in the dark.
Sixty-two percent of working parents feel their employer simply doesn't care about them.
Fifty-six percent of working parents are not happy at their current job.
Ninety-eight percent of working parents say they have experienced burnout.
Sixty-four percent do not feel their employer is attentive to the needs of working parents.
Forty-eight percent of working parents are stressed about managing their health today, an increase from forty-one percent in 2014.
Seventy-seven percent of working parents say burnout has caused them to become depressed, anxious, or get sick more often.
Seventy-nine percent of working parents and seventy-seven percent of managers agree a change needs to be made at the office-not at home-to curb burnout.

The study, the second annual Modern Family Index commissioned by Bright Horizons Family Solutions, explored the challenges working parents have in managing their work and family responsibilities and the impact these challenges have on employers.

We invite you to share our newsletter.

(It's a lot to think about!)

Telecommuting For Non-exempts - Does it Work for You

Consider the following if you are contemplating letting non-exempt employees telecommute:

Re-evaluate your approach to performance management - determine if the position needs a physical presence either full-time or part-time to access performance.
Remote time-tracking software - if there is no way for an employee to log into their computer programs remotely, consider installing time tracking software onto the employer provided computer.
Create a firm overtime policy that requires pre-approval of overtime hours.
Execute an hours worked agreement with employee to ensure the understanding of what is expected with the tracking of their compensable work time, including documenting breaks and meals.

What would you like to see in a future issue?

Contact our office with your suggestions.

email: info@mfyco.com

From the Horse's Mouth

Now you don't have to answer the IRS Compliance Questions on the 2015

Form 5500-Series Returns

The IRS has decided not to require plan sponsors to complete these questions for the 2015 plan year and plan sponsors should skip these questions when completing the form. Here are the new lines that were added to Form 5500/5500-SF and Schedules H, I and R.

Form 5500

Preparer Information (page 1 bottom)

Schedule H

Lines 4o-p, 6a-d

Schedule I

Lines 4o-p, 6a-d

Schedule R

New Part VII (Lines 20a-c, 21a-b, 22a-d, and 23)

Form 5500-SF

Preparer Information (page 1 bottom), Lines 10j, 14a-d, and New Part IX
(Lines 15a-c, 16a-b, 17a-d, 18, 19, and 20)

Taken from the IRS Retirement Plan Website

Page Last Reviewed or Updated by IRS: 25-Feb-2016

Quick Link to 'elaws'

2016 Retirement Plan Limits

All limits are based on the calendar year.

	2016	2015	2014
Maximum Annual Defined Benefit	$210,000	$210,000	$210,000
Maximum DC Annual Addition ($$)	$ 53,000	$ 53,000	$ 52,000
Maximum 401(k) Deferrals	$ 18,000	$ 18,000	$ 17,500
Older EE Catch-Up Contribution	$ 6,000	$ 6,000	$ 5,500
Maximum Plan Compensation	$265,000	$265,000	$260,000
Highly Compensated Threshold	$120,000	$120,000	$115,000
Key Employee in a Top-Heavy Plan	$170,000	$170,000	$170,000
Income Subject to Social Security Tax	$118,500	$118,500	$117,000
PBGC Maximum Monthly Guarantee*	$5,011.33	$5,011.33	$4,943.18
Maximum DC Annual Addition (%)	100%	100%	100%
Social Security Tax - Employee	6.2%	6.2%	6.2%
Social Security Tax - Employer	6.2%	6.2%	6.2%
Medicare Tax**	1.45%	1.45%	1.45%
DC Plan Deduction Limit	25%	25%	25%
Definition of Compensation for DC Plan Deduction Limit	Includes Deferrals	Includes Deferrals	Includes Deferrals
Life Annuity at age 65 * Individuals with earned income over $200,000 pay an additional 0.9% in Medicare taxes

If you have not received our business card with these numbers printed on it and would like one, please let us know! We would be happy to mail you one (or a few to share!)

about MFYCO ...

Michael F. Yates & Company, Inc. can help you with a variety of services ranging from retirement plans to providing results-oriented survey instruments, training and development programs for your employees. Our products and services are intended to help you maximize the effectiveness of your Human Resources function.
These products and services incorporate our years of experience so that you receive rapid results and exceptional value. From onsite consulting, to strategic business integration, to Web enablement, we understand how Human Resources can be applied to solve your problems and achieve your goals. As a result, we can help you get the most out of your investment and turn your most precious resource into a competitive advantage.
We offer Consulting, Retirement Planning, Pension and 401(K) both qualified and non qualified Plans, Welfare Plans, Communications, Computer Systems, Executive Plans, Compensation, Mergers, Acquisitions, Divestitures and Other Services.
We offer a true and honest, Client Partnership.

Take the Michael F. Yates & Company, Inc. challenge!

Call us today ... 908-689-4200

How to Track Government Recovery Spending

"The Board shall establish and maintain...a user-friendly, public-facing website to foster greater accountability and transparency in the use of covered funds. The website...shall be a portal or gateway to key information relating to the Act and provide connections to other government websites with related information."

American Recovery and Reinvestment Act of 2009 information can be found by clicking here.

Michael F. Yates & Company, Inc.
_________________

101 Belvidere Avenue
P.O. Box 7

Washington, NJ 07882-0007

908-689-4200

fax: 908-689-6300

email: info@mfyco.com

Our staff and firm are proud members
of the following professional organizations:

Society of Actuaries

American Society of Pension Professionals & Actuaries

Society for Human Resource Management

GAPS (Global Association Pension Services)

WorldatWork

American Management Association

National Federation of Independent Business

Better Business Bureau

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Concluding Note

As always, any statements regarding federal tax law contained herein are not intended or written to be used, and cannot be used, for the purposes of avoiding penalties that may be imposed under federal tax law or to market any entity, investment plan or arrangement.