I get a lot of questions on whether or not a payroll professional should get certified and if they should then which certification should they try for first. Should they go right into the CPP exam? Or start off with the FPC and work up to the CPP? Many payroll professionals are even confused as to which certification they could qualify for. In their blog, Payroll News, Symmetry Software has done a very nice and quick comparison of the two certifications offered by the APA. If you are looking to certify but aren’t sure which test to try for, take time to check out the blog today.
A recent article from RIA told of the following problem:
Mike McGuire from IRS Modernized e-File (MeF) told listeners to the May 4 payroll industry telephone conference call that the IRS has been rejecting “tens of thousands” of 2017 first quarter electronically-filed Forms 941, Schedule B (Report of Tax Liability for Semiweekly Schedule Depositors) because the total tax liability on Schedule B does not agree with the total tax liability on Form 941, line 12 (Total taxes after adjustments and credits). Prior to the 2017 tax year, the total tax liability on Schedule B had to agree with Form 941, line 10 (Total taxes after adjustments), or the IRS would reject it. However, the IRS revised some of the line numbers on Form 941, beginning with the 2017 tax year, to take into account that “qualified small businesses” may now elect to claim a portion of their research credit as a payroll tax credit against their employer FICA tax liability, rather than against their income tax liability. Beginning with the 2017 tax year, the total tax liability on Schedule B must agree with Form 941, line 12 (Total taxes after adjustments and credits) rather than line 10. Some electronic filers have not adjusted their programs to take this change into account. Rejected returns have to be resubmitted to the IRS.
Make sure your system has made this change.
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I just completed my registration for the American Payroll Association’s 2017 Virtual Congress & Expo. This is a free event for APA members which is held every year. This is the 8th year for the event and the 6th one I will be attending. This is the online companion to the Annual Congress. But for me it is the only one I can usually attend. I love attending the live, real world congress. I get to meet up with associates, network and gain valuable knowledge. However, my schedule just doesn’t permit me to take the time off to attend most years. But virtual congress is different. I can attend in the morning, take time to do one of my webinars and be back in the afternoon. I still get to network with old friends and make new ones using the networking lounge’s chat boards. I get to see all who are attending and can even contact attendees directly to say hello. The webinars are always educational. This year we are looking at such subjects as:
- State Unemployment Rates: How Did They Arrive at Our Rate?
- Is this Taxable?
- Global Payroll
- Calculations Your High School Teacher Never Taught You
I am really looking forward to these webinars. Virtual congress is the next best thing if your work schedule or budget just won’t let you attend Congress. So I hope to “see you there”. By the way did I mention that you can earn up to 15 RCHs for attending the webinars. And if you register but can’t attend everything, after the virtual congress concludes, the webinars are then open as on-demand webinars until August. This is great for me. I can catch up on the ones I had to miss due to work or that were scheduled at the same time as another topic I wanted to check out.
For more info check out the APA website.
This week the House of Representatives passed The Working Families Flexibility Act of 2017, H. R. 1180. The purpose of this bill is to amend The Fair Labor Standards Act of 1938 to allow employees to receive compensatory time off instead of payment for overtime worked for employees working in the private sector. It sponsors say that this gives employees in the private sector the same flexibility that employees in the public sector have enjoyed for a number of years. In essence, being able to choose between being paid for overtime or getting time off at a later date. I have not yet made a decision on this bill as to whether or not I support it. It has good points but it also has a lot of flaws.
- the bill does require that the employee agree to, in writing, receive comp time instead of being paid for the overtime worked. If the employee would prefer to be paid over time then they have to be paid overtime, at least in theory.
- The bill also requires that the employee be given opportunity to take the comp time when requested, as long as it does not interfere with business operations.
- The bill does require that the employee be cashed out upon termination, voluntary or involuntary, or at the end of a 12 month period. This in theory prevents overtime from never being paid.
- The bill permits an employee to opt out after agreeing in writing to be paid compensatory time and does not permit compensatory time to be as a condition of employment.
- The bill does not allow new employees to be forced to take compensatory time instead of overtime. The employee must work at least 1000 hours for the employer before they can agree to be pay compensatory time.
- The bill sunsets after five years and requires after two years that the GAO submit a report outlining whether or not there were complaints alleging violation of the rules made to the Secretary of Labor or the Department of Labor. It requires an accounting of any unpaid wages, damages, penalties, injunctive relief, or any other remedies that were obtained or sought by the Secretary Of Labor.
However there are flaws:
- first the premise that public sector employees “enjoy” the privilege of compensatory time in lieu of overtime. Public sector employees did not come under the FLSA until 1985 when it was mandated by a court decision. Private-sector employees have been under the FLSA since 1938. The only reason the comp time in lieu of overtime was permitted is because it was written into many cities, counties and states requirements because they were spending public money. It was never something that was negotiated or requested by the employees themselves.
- Many studies in the United States show that employees tend not to take all of the vacation they are due because they can’t get the time off from their employers. So my question is if they can’t get time off to take vacation that has been given them how will they be able to take off using compensatory time? Especially when the bill does not state that they must be given the comp time when requested but only if it does not interfere with business operations. And how many of us have not been able to take our vacation because our boss says I can’t give you the time off right now.
- If not able to take the time off due to business operations then what’s the purpose of having comp time except to delay paying the employee overtime that was rightfully do. I understand that taking time off does affect business operations and if I’m requesting vacation I can understand that my boss can say not at this time. Because in essence vacation is not something that I actually worked for, but a benefit my boss is offering me. But compensatory time off is not the same as vacation although this bill seems to treat it that way. This is money that I’ve already worked for and am already due. It is not a benefit that my boss gets to allow me to take at his or her convenience.
- My biggest problem with this bill is the fact that even though it says that the GAO will present a study on whether or not there were violations the fact is that the Labor Department collects hundreds of millions of dollars each year for violation of simple minimum wage and overtime rules. These rules have been in effect since 1938 and yet employers still violate them on a regular basis. Is this just adding one more area that employees will have to sue their employers through the DOL to get their money? Especially lower paid or minimum wage employees. Is this one more thing the employee will have to be aware of and make sure they are being paid properly?
Compensatory time off bills have passed the house many times in the past but have never gone past the Senate, usually dying in committee. But these are not normal times so we will have to wait and see.
As many of us who use Facebook know, the grammar police are constantly posting memes about the proper use of commas. Recently the placing of a comma came into play which cause one employer to have to pay back wages for overtime. The U.S. Court of Appeals for the First Circuit has overturned a federal district court opinion and ruled that dairy company delivery drivers are eligible to receive overtime under Maine’s overtime laws. At issue was Maine Rev. State. Ann. §664(3)(F), which provides an exemption from overtime for those involved in the “canning, processing, preserving, freezing, drying, marketing, storing, packing for shipment or distribution” of perishable food. The drivers did not dispute that they handled perishable foods, but said that they do not engage in “packing” them, and therefore are eligible to receive overtime. The employer argued that the above provision actually refers to two distinct exempt activities (“packing for shipment,” and ”distribution”), and therefore the exemption from overtime applies to the drivers. The appellate court sided with the drivers. It said that the exemption would have applied to the drivers if the statute had read “packing for shipment, or distribution” rather than “packing for shipment or distribution.” Since the drivers did not pack items for either shipment or distribution, their activities did not come under the statutory exemption [O’Connor v. Oakhurst Dairy, CA1, Dkt. No. 16-1901, 3/13/17].
So watch out for where the commas are placed if you want to avoid penalties!
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Localities such as cities or counties have been enacting their own wage and hour requirements for quite a few years now. Dozens of cities in California and New Jersey have their own sick leave laws as well as higher than state minimum wages. New Mexico has local minimum wages as does Washington. But it seems the state legislators are starting to fight back. With the assistance of groups such as the American Legislative Exchange Council (ALEC) model bills (draft legislation that legislators may customize and introduce) have passed in several states. The latest states to pass such legislation are Arkansas and Iowa. These bill basically forbid the local governments from passing any type of law relating to minimum wage, living minimum rates, employment leave or benefits, hiring practices or any condition of employment that is more generous than the federal or state law. Whether cities will fight back in the courts, or if they even can, remains to be seen. Miami Beach recently tried to establish its own minimum wage despite Florida having passed its own version of the ALEC legislation. The court struck down the Miami Beach ordinance. So the fight continues. Payroll professionals need to monitor local minimum wage and sick leave ordinances to ensure compliance but remember these ordinances can be fleeting if the state has passed the ALEC-style legislation.
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All my readers with young daughters knows the price of a Disney princess costume. Well now Disney does too. Or at least the cost of making deductions for maintaining them. The Department of Labor (DOL) recently announced that two subsidiaries of Walt Disney Company have agreed to pay $3.8 million in back wages to 16,339 employees to ensure compliance with the Fair Labor Standards Act (FLSA). Among the violations found by the wage and hour division was that the Disney resorts in Florida deducted a uniform or a “costume” expense that caused some employees hourly rates to fall below the federal minimum wage. However under the wage and hour rules, the FLSA does not allow deductions for uniforms if it reduces the employees wage below $7.25 per hour. In addition the cost may not cut into overtime compensation. The proper handling of uniforms is often a source of confusion for payroll departments and company employees. The DOL’s Fact sheet #16 provides the information on the proper deductions for uniforms and other facilities.