by Stephen D. Hans | Jun 12, 2018 | Employment Defense Attorney, Misclassifying Workers as Independent Contractors
How Would Your Small Business Fare with the IRS for Worker Status? Did you know that misclassifying workers is one of the top problems that small business owners face? Many small businesses hire independent contractors as part of running their businesses and delivering services or products. It is vital for employers to ensure that they classify workers correctly. What Can Happen as Result of Misclassifying Workers as Independent Contractors? The IRS website explains that misclassified workers can file a Social Security Tax Form 8919. Form 8919 is a request for uncollected Social Security and Medicare taxes due on their compensation. In other words, the employer could owe a considerable amount of compensation to the worker because the worker paid the Social Security and Medicare taxes instead of the employer, due to the fact the worker was misclassified as an independent contractor. What Recourse Do You Have If You Believe the Worker Has Not Been Misclassified? The IRS recognizes the fact that you may have had a reasonable basis for classifying a worker as an independent contractor and not as an employee. Therefore, relief provisions are granted in such cases. However, you must file all the necessary federal information returns to establish your basis for relief. (See section 530 Employment Tax Relief Requirements). What is the Voluntary Classification Settlement Program? The Voluntary Classification Settlement Program (VCSP) offers employers the option of reclassifying workers as employees for future tax periods. It also provides partial relief from federal employment taxes when the employers agree to classify their workers or a class or group of workers as employees. Employers must meet certain eligibility...
by Stephen D. Hans | Apr 19, 2018 | Employment Defense Attorney
Can Employers Ask Employees About their Salary History? On May 4, 2017, the New York City Council passed a bill that limited what an employer can ask job candidates about their salary history, compensation history and other past benefits when interviewing them for a job. The law went into effect on October 31, 2017. The National Law Review explains that new law was part of the New York City Human Rights Law. What this means for employers is that violations are subject to compensatory damages, which could include back pay, front pay, punitive damages, attorneys’ fees, emotional distress, etc. What was the purpose of passing the law? The law had the purpose of preventing employers from using a job applicant’s past salary history to determine compensation. The employer cannot ask the job applicant about previous salary history for a current or prior wages, about benefits or other job compensation they have received. It is also unlawful for an employer to ask the previous employer what the individual was being paid or to ask about salary history. The employer also is prohibited from searching public records to obtain a job candidate’s salary history. When the job candidates volunteer their salary history without any prompting, the employer can legally verify the information with the previous employer and use the salary history in determining the current salary. What can an employer ask? Employers can ask about the job candidate’s previous production at the job, such as how much revenue or sales they brought in or about other production statistics related to their work. Employers can inform job candidates in writing or verbally...
by Stephen D. Hans | Mar 28, 2018 | Employment Defense Attorney
As an employer, have you ever wondered if a wage deduction you made was legal? New York Labor Law establishes what is legal and what is not for wage deductions. If you have questions, it is always wise to seek legal counsel from an experienced employment law defense attorney. The NY legislature passed an amendment to NY Labor Law 193 Deductions from Wages in October 2015. The amendment went into effect on November 6, 2015 and expires on November 6, 2018, unless the legislature renews it. Two main features of the amendment are allowing employers to deduct for over payments and salary advances. Overpayments The amendment permits employers to make wage deductions for accidental overpayments. Overpayments refer to payments made due to a mathematical or clerical error by the employer. Note that the employer must provide the employee with a notice of the overpayment deduction prior to commencing the recovery. Also, regulations govern how the deduction is made based on the size of overpayment along with the timing, frequency, duration and method of recovery. In addition, the employer must provide a procedure for the employee to dispute overpayment amounts and the procedure for recovering it. Salary Advances The employer must abide by rules the Commissioner has established for the timing, frequency, duration and method of deduction of a salary advance. There are also limitations on the periodic amount of repayment of the advance. Employers must provide employees with a notice before commencing repayment and also provide a procedure for the employee to dispute the amount or to seek delay of repayment. In addition to wage advances and overpayments, some...
by Stephen D. Hans | Mar 13, 2018 | Employment Defense Attorney, Restaurant Industry
Owners in the restaurant industry often have questions about tips. As a restaurant owner, it’s important to know your rights and responsibilities regarding tips so you can avoid disputes with employees and not put your business at risk. The Fair Labor Standards Act (FSLA), which is federal law, and the New York Labor Law (state law) determine how restaurant owners must deal with tips. In the past, people paid restaurant bills with cash, but today credit cards are a popular and common form of payment. How must a restaurant owner deal with credit card tips? When tips are received by credit card, the owner must pay the employee the tip amount due no later than the regularly scheduled payday. Credit card companies charge a fee to the merchant for use of credit cards, and the fee is a percentage of the total amount paid on the card. The employer deducts the pro-rated share of the credit card company charge from the tip when calculating the employee’s tip. How must an employee’s wage statement reflect wages and tips? The wage statement must indicate the amount being paid to the employee in wages and the amount paid in tips. How should employers handle cash tips? Employers can allow employees to leave their cash tips with the employer during a particular pay period. However, doing so must be voluntary and up to the employee. Employers can hold tips as a service to the employee, and employers would indicate the amount in tips and wages in the wage statement. Employers cannot make their service of keeping cash tips as a mandatory hiring condition...
by Stephen D. Hans | Feb 26, 2018 | Employment Defense Attorney, Wage and Hour
New York employment laws dictate how employers must pay employees, and extensive information is available about Wage and Hours laws that require employers’ compliance. According to the New York Department of Labor, employers frequently ask the following two questions about wages. What information must an employer’s payroll records contain? Employers’ payroll records must show information for each week an employee works. Records must show the following: The total hours worked each day The total hours worked for the week The rate or rates of pay and basis (by the hour, shift, day, week, salary, piece, commission or other) Whether the employer paid more than one hourly rate and the number of hours worked at each rate Whether the employer paid piece rates and the number of pieces completed at each piece rate Gross wages Deductions Allowances or credits, if any, claimed as part of the minimum wage Net wages Overtime Records When the employee works overtime and the law requires that the employee be paid at a higher rate for overtime hours, the payroll record must show the items below (in addition to the items above): The number of regular hours worked The regular hourly rate or rates of pay The number of overtime hours worked The overtime rates of pay May employers deduct money from wages? Employers are permitted to deduct certain items from their employee’s wages, including: Taxes Insurance premiums Union dues Employers are not permitted to deduct the following from employees’ wages: Charges to employees for breakages Cash shortages Fines Other losses to the business Get Legal Help to Deal with New York Wage and Hours...
by Stephen D. Hans | Feb 7, 2018 | Employment Defense Attorney
FAQ for Restaurant Owners For restaurant owners, who are busy running their day-to-day business, New York Labor laws can seem like an added burden. Having access to a NY employment defense lawyer is often vital to navigate the laws and make your business successful. According to the NY State Department of Labor, here are some frequently asked questions employers often ask: Can you require employees to wear uniforms? Yes, you can. What is considered a uniform? Black slacks and white shirts are not uniforms. A shirt with the company insignia or custom-made slacks and shirts would be considered uniforms. If your worker’s pay is minimum wage, then the cost of buying the uniform and taking care of it cannot bring the employee below the minimum wage rate. Employers must either clean and take care of the uniforms or pay their employees to care for them. Are you limited by the number of hours an employee can work in a day? Except for children under 18, there are no limitations on how many hours in a day an employee can work. There also are no limitations on how early or late an employer can ask an employee to work. However, in the restaurant industry, an employee must have 24 hours of rest one day in a calendar week. This does not apply to small, rural restaurants. What are the rules for giving workers meal breaks? For work shifts of more than six hours that begin before 11:00 a.m. and continue until 2:00 p.m., the workers must be provided with an uninterrupted lunch period of at least half an hour between...
