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The US Department of Labor (DOL) recently announced a $2,261,417 National Emergency Grant to provide re-employment services to about 365 workers affected by layoffs at 12 companies throughout Massachusetts, including four employee staffing businesses that provided workers for the other companies.

Layoffs Scheduled to Continue Through 2012

The layoffs, which began in May 2008 and are scheduled to continue until March 2012, are occurring at Biogen Idec in Cambridge, Commercial Sheet Metal in Canton, Covidien in Mansfield, EDO Fiber Innovations/ITT Corp. in Walpole, Henkel Corp. in Billerica, International Power America in Marlborough, Reveal Imaging Technologies Inc. in Bedford and Unilever-Breyers Ice Cream in Framingham. The staffing agencies include Kelly Services in Quincy, Randstad in Boston, Aerostek in Braintree and Total Technical Services in Waltham.

DOL Secretary Solis Comments on Grant

“This funding from the federal government is a step toward helping Massachusetts workers, who face a challenging market, find new employment,” said Secretary of Labor Hilda L. Solis. “The grant will support efforts to prepare these individuals for good jobs in high-growth occupations.”

Funds Are Awarded to the Massachusetts Department of Workforce Development

Awarded to the Massachusetts Department of Workforce Development, the grant will provide training and supportive services for affected workers. Supplemental services will be available to workers who also have been deemed eligible for benefits in the form of Trade Adjustment Assistance. Those who are not eligible for TAA will receive the full array of employment-related services available under this grant.

Additional Funding May be Available at a Later Date

Of the $2,261,417 announced today, $998,078 will be released initially. Additional funding up to the amount approved will be made available as the commonwealth demonstrates a continued need for assistance.

National Emergency Grants Are Part of Discretionary Fund

National Emergency Grants are part of the secretary of labor’s discretionary fund and are awarded based on a state’s ability to meet specific guidelines.

The Massachusetts Division of Occupational Safety (DOS) issues prevailing wage schedules to cities, towns, counties, districts, authorities, and agencies of the Commonwealth for construction projects and several other types of public work. These prevailing wage schedules contain hourly wage rates that workers must receive when working on a public project.

DOS Recently Released PW-2011-01-01.06.11 on Prevailing Wages

The DOS regularly issues Prevailing Wage Opinion Letters and recently released PW-2011-01-01.06.11. This letter confirms “the duration of wage rates issued for contracts between school districts and school bus companies.”

DOS Provides Analysis of Relevant Massachusetts Law

According to the DOS, the relevant law is contained in MGL c 71, §7A. “§7A provides, in relevant part, that: ‘no contract [for the transportation of pupils] shall be awarded except upon the basis of prevailing wage rates…’ §7A further provides that ‘[P]rior to awarding a contract, the school committee…shall request the commissioner…to determine the rate of wages to be paid to each person to be employed by the bidder under said contract, and shall forward to the commissioner a list of jobs to be performed under the contract.’ Because the statute specifies that a list of all jobs shall be provided to the commissioner and included in the prevailing wage schedule, those words should be given full effect by the commissioner in applying the statute. Accordingly, the plain language of the statute directs the commissioner to set wage rates for the bus driver and any other personnel that the bidder is required to provide under the contract.”

The DOS Interprets the Phrase “Contract Term”

According to the DOS, it “interprets the phrase ‘contract term’ with respect to the plain language meaning of the term. Accordingly, if the original term of a school bus contract is, for e.g., three years, then the wage rates contained on the wage schedule for the contract are applicable to that three year term. Any extension of the original term would therefore trigger the requirement to obtain updated wage rates. This is consistent with the way awarding authorities treat renewals/options to renew.”

Vision Payroll Assists Employers Preparing Certified Weekly Payroll Reports

Vision Payroll is ready to assist employers in gathering information for certified weekly payroll reports. Vision Payroll can also prepare the certified weekly payroll reports for submission to the proper authorities. Contact Vision Payroll today to get started.

The New England unemployment rate was essentially unchanged at 7.8% in August, the US Bureau of Labor Statistics reported recently. Regional Commissioner Denis M. McSweeney noted that the over-the-year change in New England’s unemployment rate was not statistically significant. The national jobless rate was unchanged at 9.1%, but was 0.5 percentage point lower than a year earlier.

Pacific Division Continues to Report Highest Rate

New England is one of nine geographic divisions nationwide. Among the nine divisions, the Pacific continued to report the highest unemployment rate, 11.2% in August. The West North Central again registered the lowest rate, 6.9%. Over the month, the East North Central was the only division to experience a statistically significant unemployment rate change (+0.2 percentage point). The East North Central also recorded the only significant rate change among divisions over the year (-0.6 percentage point).

Four New England States Have Significantly Lower Rates than Rest of Nation

In August, five of the six New England states posted jobless rates that were significantly different from that of the United States. New Hampshire (5.3%), Vermont (5.9%), Massachusetts (7.4%), and Maine (7.6%) recorded lower-than-average unemployment rates and were among 25 states in the country to do so. In fact, New Hampshire reported the fourth-lowest jobless rate nationwide. In contrast, Rhode Island (10.6%) had the highest jobless rate among the New England states and was among eight states and the District of Columbia with rates significantly higher than the national average. Connecticut was among the 17 remaining states that registered unemployment rates that were not appreciably different from that of the nation.

No New England State Had a Significant Rate Increase in August

In August, seven states and the District of Columbia posted statistically significant rate increases from July. The six New England states were among the 43 remaining states that registered jobless rates that were not measurably different from those of a month earlier, though some had changes that were at least as large numerically as the significant changes.

Most States Had Minimal Change over the Last Year

Over the year, five states recorded statistically significant unemployment decreases. The District of Columbia posted the only significant rate increase from a year earlier (+1.3 percentage points). The six New England states were among the 45 states that registered jobless rates not appreciably different from those of a year earlier.

This week’s question comes from Steve, a small business owner.

Steve asks:

I’ve read about the Voluntary Classification Settlement Program (VCSP) and its application process with the Internal Revenue Service (IRS). What are the IRS and Department of Labor (DOL) doing about workers who receive 1099s?

Answer: The IRS and DOL are entering into agreements that include the IRS and DOL as well as several states to share information and coordinate enforcement of current laws and regulations.

Memoranda Signed at Washington Ceremony

Secretary of Labor Hilda L. Solis recently hosted a ceremony at DOL headquarters in Washington to sign a memorandum of understanding with the IRS that will improve departmental efforts to end the business practice of misclassifying employees in order to avoid providing employment protections. In addition, labor commissioners and other agency leaders representing seven states signed memoranda of understanding with the department’s Wage and Hour Division (WHD) and, in some cases, its Employee Benefits Security Administration, Occupational Safety and Health Administration, Office of Federal Contract Compliance Programs and Office of the Solicitor. The signatory states are Connecticut, Maryland, Massachusetts, Minnesota, Missouri, Utah and Washington. Secretary Solis also announced agreements for the WHD to enter into memoranda of understanding with the state labor agencies of Hawaii, Illinois and Montana, as well as with New York’s attorney general.

DOL and IRS Will Share Information with Participating States

The memoranda of understanding will enable the DOL to share information and coordinate law enforcement with the IRS and participating states in order to level the playing field for law-abiding employers and ensure that employees receive the protections to which they are entitled under federal and state law.

Secretary Solis: We’re Standing United to End the Practice of Misclassifying Employees

“We’re here today to sign a series of agreements that together send a coordinated message: We’re standing united to end the practice of misclassifying employees,” said Secretary Solis. “We are taking important steps toward making sure that the American dream is still available for all employees and responsible employers alike.”

Commissioner Shulman: We Will Work Together More Efficiently to Address Worker Misclassification Issues

“This agreement takes the partnership between the IRS and DOL to a new level,” said IRS Commissioner Doug Shulman. “In this new phase of our relationship, we will work together more efficiently to address worker misclassification issues, and better serve the needs of small businesses and employees.”

Misclassification Can Create Economic Pressure for Law-Abiding Business Owners

Business models that attempt to change, obscure or eliminate the employment relationship are not inherently illegal, unless they are used to evade compliance with federal labor laws — for example, if an employee is misclassified as an independent contractor and subsequently denied rights and benefits to which he or she is entitled under the law. In addition, misclassification can create economic pressure for law-abiding business owners.

Memoranda Arose as Part of the Misclassification Initiative

These memoranda of understanding arose as part of the department’s Misclassification Initiative, which was launched under the auspices of Vice President Biden’s Middle Class Task Force with the goal of preventing, detecting and remedying employee misclassification.

Contact Vision Payroll Today

Contact Vision Payroll if you have further questions on the memoranda of understanding.

For the second straight year, Vision Payroll has been selected as an Outstanding Achievement Award winner by Payroll Associates, the leading payroll software provider in the country. The platinum level award, the highest honor given, was announced at the annual users’ conference held recently in Charlotte, North Carolina.

Customer Service Is a Top Priority at Vision Payroll

“Many companies claim to make customer service a priority,” said Anne Leader, president of Vision Payroll. “To receive a platinum-level award and be one of only four companies from among hundreds of eligible companies to win in consecutive years proves that we at Vision Payroll make customer service our top priority every day.

“Our customers recognize this dedication and that’s why each year hundreds of them choose to use Vision Payroll for their payroll and other employer services.

“We thank our employees for their hard work and customer focus that puts a human face on our leading-edge technology. We also want to thank our business associates, whose belief in us is evidenced by their many referrals each year that allow us to grow our business successfully. Finally, we say thank you to our customers for their on-going support. The gratitude and loyalty our customers show Vision Payroll make awards like this possible.”

Vision Payroll Offers a Superior Solution in Payroll and Other Employment-Related Areas

Vision Payroll of Leominster, Massachusetts provides payroll processing, human resource management, time and attendance, recruiting, employee screening, and talent management and collaborates with the top providers in other related areas to deliver a superior solution for the employee-related needs of today’s employers.

Due to the damage caused by Tropical Storm Irene in Massachusetts beginning on August 27, 2011, President Barack Obama declared the following counties a federal disaster area: Berkshire and Franklin. Individuals who reside or have a business in these counties may qualify for tax relief.

Declaration Leads to Extension of Payroll Tax and Other Deadlines

Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after August 26, 2011 and before September 13, 2011 as long as the deposits are made by September 12, 2011. In addition, affected taxpayers have until October 31, 2011 to file most tax returns.

Vision Payroll Is Here to Help Affected Taxpayers with Payroll Tax Issues

Contact Vision Payroll if you were affected by Tropical Storm Irene and need further information on the relief provided by the IRS.

The Internal Revenue Service (IRS) is providing tax relief to individual and business taxpayers impacted by Hurricane Irene.

The IRS has announced that certain taxpayers in Connecticut, Massachusetts, New Jersey, New York, North Carolina, Puerto Rico and Vermont will receive tax relief, and other locations are expected to be added in coming days following additional damage assessments by the Federal Emergency Management Agency (FEMA).

The tax relief postpones certain tax filing and payment deadlines to Oct. 31, 2011. It includes corporations and businesses that previously obtained an extension until Sept. 15, 2011, to file their 2010 returns and individuals and businesses that received a similar extension until Oct. 17. It also includes the estimated tax payment for the third quarter of 2011, which would normally be due Sept. 15.

The tax relief is part of a coordinated federal response to the damage caused by the hurricane and is based on local damage assessments by FEMA. For information on disaster recovery, individuals should visit disasterassistance.gov.

Tax Relief Available So Far

Filing and payment relief is currently available to taxpayers in federal disaster areas declared in Connecticut, Massachusetts, New Jersey, New York, North Carolina, Puerto Rico and Vermont. The IRS expects to announce tax relief for taxpayers in other areas as damage assessments continue. The IRS encourages taxpayers and tax practitioners to monitor Tax Relief in Disaster Situations for updates.

So far, IRS filing and payment relief applies to the following counties and municipalities:

• Connecticut: Fairfield, Hartford, Litchfield, Middlesex, New Haven, New London, Tolland and Windham;
• Massachusetts: Berkshire and Franklin.
• New Jersey: Atlantic, Bergen, Burlington, Camden, Cape May, Cumberland, Essex, Gloucester, Hudson, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Passaic, Salem, Somerset, Sussex, Union and Warren.
• New York: Albany, Clinton, Delaware, Dutchess, Essex, Greene, Montgomery, Nassau, Orange, Otsego, Rensselaer, Rockland, Saratoga, Schenectady, Schoharie, Sullivan, Suffolk, Ulster, Warren and Westchester.
• North Carolina: Beaufort, Bertie, Brunswick, Camden, Carteret, Chowan, Craven, Currituck, Dare, Duplin, Edgecombe, Gates, Greene, Halifax, Hertford, Hyde, Johnston, Jones, Lenoir, Martin, Nash, New Hanover, Northampton, Onslow, Pamlico, Pasquotank, Perquimans, Pitt, Tyrrell, Vance, Warren, Washington and Wilson;.
• Puerto Rico: Arroyo, Aguas Buenas, Caguas, Canovanas, Carolina, Cayey, Cidra, Coamo, Comerio, Humacao, Jayuya, Juncos, Loiza, Luquillo, Orocovis, Patillas, Ponce and San Juan.
• Vermont: Addison, Bennington, Caledonia, Chittenden, Orange, Rutland, Washington and Windsor.

Vision Payroll is Here to Help Affected Taxpayers with Payroll Tax Issues

Contact Vision Payroll if you were affected by Hurricane Irene and need further information on the relief provided by the IRS.

The New England unemployment rate was essentially unchanged at 7.9% in July, the US Bureau of Labor Statistics reported today. Regional Commissioner Denis M. McSweeney noted that the over-the-year change in New England’s unemployment rate was not statistically significant. The national jobless rate was little changed at 9.1%, but was 0.4 percentage point lower than a year earlier.

Pacific Division Reported Highest Rate

New England is one of nine geographic divisions nationwide. Among the nine divisions, the Pacific continued to report the highest unemployment rate, 11.2% in July. The West North Central again registered the lowest rate, 6.8%. Over the month, two divisions experienced statistically significant unemployment rate changes: the East North Central (+0.3 percentage point) and Pacific (+0.2 point). Over the year, the East North Central recorded the only significant rate change among divisions (-1.0 percentage point).

Five New England States Have Significantly Lower Rates than Rest of Nation

In July, five of the six New England states posted jobless rates that were significantly different from that of the United States. New Hampshire (5.2%), Vermont (5.7%), Massachusetts (7.6%), and Maine (7.7%) recorded lower-than-average unemployment rates and were among 25 states in the country to do so. In fact, New Hampshire reported the fourth-lowest jobless rate nationwide. In contrast, Rhode Island (10.8%) had the highest jobless rate among the New England states and the fifth-highest jobless rate in the nation. Rhode Island was among eight states and the District of Columbia that had unemployment rates significantly higher than the national average. Connecticut was among the 17 remaining states in recording unemployment rates not appreciably different from that for the nation.

New Hampshire Has Significant Rate Increase in July

In July, New Hampshire was the only New England state and one of 10 states nationwide to report a statistically significant unemployment rate change from June (+0.3 percentage point). The District of Columbia also experienced a significant over-the-month rate increase (+0.4 percentage point). The remaining five New England states were among the 40 states that registered jobless rates that were not measurably different from those of a month earlier, though some had changes that were at least as large numerically as the significant changes.

Most States Have Minimal Change over the Last Year

Over the year, 11 states recorded statistically significant unemployment rate changes, all decreases. The six New England states were among the 39 states and the District of Columbia that registered jobless rates not appreciably different from those of a year earlier.

This week’s question comes from Josh, a company owner. We’re paying more in state unemployment tax this year than we have in the past. Even though we didn’t lay anyone off, our DUA experience rate increased from last year. How is our Massachusetts DUA experience rate determined? Answer: The DUA Experience rate is determined by the Massachusetts Division of Unemployment Assistance (DUA), which is headquartered in Boston. The DUA also has career centers throughout the state including Attleboro, Brockton, Cambridge, Everett, Fall River, Gardner, Gloucester, Greenfield, Haverhill, Holyoke, Hyannis, Lawrence, Leominster, Lowell, Lynn, Marlboro, Milford, New Bedford, Newtonville, Northampton, Norwood, Pittsfield, Plymouth, Quincy, Salem, Southbridge, Springfield, Taunton, Wareham, Woburn, and Worcester.

DUA Account Is a Record of Four Types of Adjustments

The DUA maintains an individual account for every employer required to pay unemployment insurance contributions. The account balance is an accumulation of the following four types of adjustments:

• The employer’s wages subject to contribution,
• The contributions actually paid by the employer,
• The unemployment insurance benefits charged to the employer, and
• Any account balance adjustment.

Computation Year Runs from October 1 To September 30

The account also provides an opening and a closing balance for the computation year (October 1 through September 30). An account balance carries over from year to year as long as the employer is required to file quarterly reports.

Account Balance Is Used to Determine Contribution Rate

DUA uses each employer’s account to determine an annual contribution rate for that employer. The experience rating process is the method used to determine the rate.

September 30 Is the Computation Date

The last day of each fiscal year, September 30, is called the “computation date” when an employer account is closed to compute the rates for the following calendar year. Contributions paid in October are credited to the employer’s account as if paid in September.

Vision Payroll Will Provide Further Information on the Experience Rating System

Over the next several weeks, Vision Payroll will provide further information on the experience rating system. Contact Vision Payroll if you have specific questions about the experience rating system that you would like to have addressed.

The Massachusetts Department of Revenue (DOR) has released Technical Information Release (TIR) 11-5, Employer-Provided Health Care Benefits Update. This TIR updates TIR 07-16, Personal Income Tax Treatment of Employer-Provided Health Insurance Coverage for an Employee’s Child, to reflect a Massachusetts statutory change to the personal income tax enacted in response to the federal Patient Protection and Affordable Care Act. The general effect of the Massachusetts change is to conform to the federal income exclusion rules for health care benefits that are in effect for each year, notwithstanding the general Massachusetts tie-in to federal income and exclusion rules as of January 1, 2005. The Massachusetts change is effective for tax years beginning on or after January 1, 2010.

Massachusetts Law Generally Conforms To 2005 IRC

In general, Massachusetts individual taxpayers must follow the Internal Revenue Code (IRC) in effect as of January 1, 2005. As a result of a recent law change in Massachusetts, taxpayers now follow the federal law for IRC §105 and §106 for exclusions from gross income for employer-provided health care benefits. This change is retroactive to January 1, 2010.

Amended Form W-2 May Be Required

Employers who imputed income for amounts that are now excluded from income may need to file Form W-2C, Corrected Wage and Tax Statement. Such a filing would be required if any 2010 or 2011 Forms W-2 have been provided to employees with such imputed income included. If a 2011 Form W-2 has not already been provided to affected employees, employers can simply adjust the 2011 Form W-2 when prepared. Employees who have already filed a 2010 Form 1, Massachusetts Resident Income Tax would need to file an amended return to reflect the Form W-2C. Employees who have yet to file can simply incorporate the Form W-2C figures into their return when they file.

Contact Vision Payroll for Assistance with Form W-2C

Contact Vision Payroll today if you have affected employees and need to file Form W-2C.