According to the US Department of Labor, in the week ended November 22, the advance figure for seasonally adjusted initial claims was 529,000, a decrease of 14,000 from the previous week’s revised figure of 543,000. The 4-week moving average was 518,000, an increase of 11,000 from the previous week’s revised average of 507,000.
Do you know what you need to know about at-will employment? Does it release you from any and all employment obligations and liabilities? What are the three exceptions to at-will employment? How can you find out what should be included in the offer letter, the employee handbook, and employment agreements to reduce your risk? Learn the answers to these questions and more in this month’s HRCast, a recording provided by our team of HR Pros and available exclusively on MyHRSupportCenter. Visit MyHRSupportCenter regularly not only for our HRCasts, but also to get late-breaking compliance alerts, best practices to implement, and HR tools to use every day. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.
The standard mileage rates for the use of automobiles beginning January 1, 2009 will be 55 cents per mile for business miles driven and 24 cents per mile driven for medical or moving purposes, the Internal Revenue Service announced yesterday in IR-2008-131. The new rates are changed from 58.5 cents per mile for business travel and 27 cents per mile for moving and medical travel for the second half of 2008. The rate for miles driven in service of charitable organizations has remained the same at 14 cents per mile. Contact Vision Payroll if you have any questions on 2009 mileage rates.
The Internal Revenue Service (IRS) recently issued Fact Sheet FS-2008-25, which discusses S corporation officer compensation. Corporate officers, whether in S corporations or C corporations, are generally considered employees of the corporation. Officers who perform only minor services or no services and are not entitled to and do not receive compensation are not considered employees.
As an employee, officers who are also shareholders must receive a reasonable salary to the extent that distributions or other payments are made to the officer-shareholder. Factors considered when determining when compensation was reasonable have included the following:
The S corporation should deduct as fringe benefits any health and accident insurance premiums paid for so-called “2% shareholders”. The amount of the premiums is taxable to these shareholders for income tax purposes, but not for FICA or FUTA.
Pursuant to IRS Notice 2008-1, a medical plan is “established by the S corporation” even if the plan is in the name of the shareholder as long as the S corporation pays the premium or reimburses the shareholder for the premium payment.
Box 14 on the Form W-2 may be used to provide the shareholder with the amount of the premiums paid, but the income should only be reported on Form W-2 and not on either Form 1099 or Schedule K-1. Contact Vision Payroll if you have any questions on Fact Sheet FS-2008-25.
David Neil, Commissioner of the Iowa Division of Labor Services (DLS), announced recently that the DLS has assessed fines of $9,988,200 and back wages of approximately $265,000 against Agriprocessors, Inc. The violations allegedly occurred during the period from January 1, 2006 to June 30, 2008. The fines were $339,700 for illegal deductions of “sales tax/miscellaneous”, $9,643,600 for illegal deductions for frocks, and $4,900 for shorting paychecks. A total of $264,786.45 was allegedly illegally deducted from employees resulting in the back wages claim. Agriprocessors, Inc. has thirty days to contest the penalties before they become final. Vision Payroll strongly recommends consulting with your labor law attorney to ensure all wage deductions are done properly.
According to the California Employment Development Department (EDD), employers in the counties of Santa Barbara, Los Angeles, Orange, Riverside, and San Bernardino directly affected by the damage resulting from the fire may request up to a 60-day extension of time from EDD to file their State payroll reports and/or deposit State payroll taxes without penalty or interest. The written request for extension must be received within 60 days from the original delinquent date of the payment or return to file/pay. Contact Vision Payroll if you’ve been affected and need to file the extension request.
This week’s question comes from Matt, a sales rep: Every week there’s a deduction for FICA on my paycheck. Two weeks ago, the deduction was lower than usual and last week there was no deduction at all. Why did my FICA tax deduction stop? Answer: The FICA (Federal Insurance Contributions Act) tax is related to Social Security’s Old-Age, Survivors, and Disability Insurance (OASDI) program, commonly called Social Security. Under this program, there is a cap on benefits based on a maximum earnings level, called the wage base. For 2008, the wage base is $102,000 and for 2009 it is scheduled to increase to $106,800. At retirement, using current law, benefit calculations are limited to earnings at or below the wage base. Therefore, no tax is withheld on earnings above the wage base, effectively limiting the maximum withholding to $6,324 in 2008. Contact Vision Payroll if you have any questions on the Social Security wage base.
According to the US Department of Labor, in the week ended November 15, the advance figure for seasonally adjusted initial claims was 542,000, an increase of 27,000 from the previous week’s revised figure of 515,000. The 4-week moving average was 506,500, an increase of 15,750 from the previous week’s revised average of 490,750.
As employers consider layoffs as one alternative during these tough economic times, the HR Pros at MyHRSupportCenter have chosen this month to review some of the laws which employers must comply with when planning and implementing layoffs. This month’s featured article discusses the Worker Adjustment and Retraining Notification Act (WARN), the Older Workers Benefits Protection Act (OWBPA), the Americans with Disabilities Act (ADA), and the Consolidated Omnibus Budget Reconciliation Act (COBRA). To learn more, sign into MyHRSupportCenter and read this month’s featured article. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.
The US Department of Labor (DOL) recently issued Administrator signed Opinion Letter FLSA2008-7. Although Opinion Letters only apply to the exact set of facts and circumstances presented in each case, they are a valuable aid in understanding current interpretations of the Fair Labor Standards Act (FLSA). This Opinion Letter states that a substitute teacher may qualify for the Professional exemption of the FLSA if the substitute teacher’s primary duty is teaching. Generally, the Professional exemption requires a “knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction.” Under the state law at issue, substitute teachers do not need a college degree or teaching certificate if they have a state-issued substitute teaching permit. The DOL concluded that it was not the degree requirements that qualified teachers as learned professionals; indeed the requirements vary widely by state and even school, with no standard minimum qualifications. Since discretion and judgment is required for teaching, substitute teachers whose primary duty is teaching qualify for the exemption. Conversely, substitute teachers whose primary duty is not related to teaching do not qualify for the exemption. State laws may provide rules that are more beneficial to the employee and must be followed. Contact Vision Payroll if you have questions about this Opinion Letter.
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