Payroll Tax Compliance – Tips vs. Service Charge

Brother Jimmy's Union Square Grand OpeningStarting in January the IRS is changing its definition of “service charge” to include automatic gratuities.  What does that mean for payroll tax compliance?  It means that these services charges are now considered regular wages and subject to payroll tax withholding instead of standard tips that an employee has to report. This also means that these wages have to be considered when when employers calculate overtime, and hourly rates for employees could vary from day to day based on the number of large parties served where automatic gratuity is charged. For more specifics follow this link to IRS website



Can Cutting Employee’s Hours due to Health Care Violate Federal Law

Many businesses have stated their plans to reduce employees hours to less than 30 hours per week as a way to take shelter from some of the new provisions of the Affordable Care Act.  Is it possible that this cost saving strategy could violate federal law?  This article gives some incite to the potential ramifications of this strategy.

How cutting employee’s hours may violate federal law.

Department of Labor – There is an app for that

The Department of Labor Wage & Hour Division has recently released a smart phone app that allows employees to track their hours on their phone.  app-for-thatThis allows them to be readily aware of whether or not they should be receiving over time and how much.  In addition to putting this wage calculator in the employees hand (which isn’t a bad thing as employees deserve over time if they qualify for it),  20% of the app is dedicated to how to contact the department of labor if they have any questions.  This give businesses one more reason to need to make sure they are fully compliant with all the current wage and hour rules and regulations.  This is one of the great benefits of using a Professional Employer Organization, they  assist business owners in keeping up with the ever changing laws to help protect them from potential financial hazards they may not know exist, and allow them to focus on growing their business.

Department of Labor 


March-MadnessHere come March Madness and here comes a slowdown in production.  It is estimated that employers stand to lose more than $100 Million in lost wages during the first two days of the tournament alone.  Extra strain on company servers from streaming games to interoffice banter about who has the best bracket.  But is it all bad?  Click here to find out: March Madness

New Employment Eligibility Verification Form I-9

Employers, below is a link to the new Employment Eligibility Verification Form I-9 issued by the Department of Homeland Security.

Several changes to the form have been made in order to reduce errors and provide cleared instructions to both employers and employees. Employers should begin using the new form effective 03/08/13 but may still use the two previous revisions up until May 7th, 2013. After May 7th, 2013 employers must only use Form I-9 (Rev. 03/08/13)

CLICK HERE TO DOWNLOAD Form I-9 (Rev. 03/08/13)