Working Remotely

“I have employees who want to work from home. However, we’ve never done this before and I’m not sure how it works.”

Your HR Survival Tip

There has never been a higher demand for the ability to work from home as there is right now. But the demand was high even six months ago because technology continues to improve and many workers prefer to work from their own home. First, however, your business needs to be structured and prepared.

If you look beyond today’s health concerns, the ability to work remotely has and will continue to be considered a benefit only available or offered to certain employees. Many industries aren’t able to function without employees on-site, such as manufacturing, transportation, construction, and those using laboratories.

An employee might think it’s easy for them to work from home, particularly if they are an office worker. However, as a business owner, you need to think of the whole picture:

Timekeeping — Are employees able to record time worked online from any computer? How can you ensure they are still taking meal and rest breaks? Are you set up to use electronic signatures?Productivity — What electronic methods do you have set  [click to read more …]

Regular Vs. Base Pay Rate

“I’m confused. When talking about an employee’s regular pay, I’m assuming it’s the same as their base pay. However, now I’m hearing something different. Are these the same?”

Your HR Survival Tip

An employee’s base rate may be the same as their regular rate. However, many times, the regular rate is actually higher than the base rate because the regular rate is based on a calculation and includes more things.

The base pay is the hourly rate you pay the employee and it’s no more complicated than that.

The regular rate, as mentioned, is a calculation based on money paid to the employee for more than just hours worked. It includes those hourly earnings, non-exempt salary, commissions, production bonuses, piece-rate earnings, and even the value of meals and lodging. Also included is that stipend you might pay the employee toward a personal insurance policy instead of providing company health insurance.

What does not count toward that regular rate are gifts, holiday pay, vacation pay, sick pay, expense reimbursements, discretionary bonuses, profit-sharing, overtime pay, and ERISA-qualified retirement plan contributions.

Why does this matter? Because when an hourly employee works overtime or uses sick time, you can’t just pay  [click to read more …]

Why You Do What You Do

“I now have about 30 employees and have heard about employee engagement but I don’t really know what that means or why it’s important.”

Your HR Survival Tip

Employee engagement, in simplistic terms, means employees are involved in your company rather than just having a job. If the employee is just coming to a job, they can easily replace that job with a different one. However, if they are engaged with your company, they feel needed and important and that emotional connection often results in much better retention and happier employees.

Involving employees in the business isn’t that hard to do. People love to give their opinions and many just need to be asked. Management often gets so wrapped up in the big picture, they don’t really know how the front line is doing. If you think about it, that front line may not have a management title but they are often the ones with great ideas that could save you money or increase production.

If we walked into your company and started talking with employees, how would they answer these questions?

Why is what you are doing important to this company?Do you have ideas of how your work  [click to read more …]

Bonus Considerations

“As we come to the end of the year, I’m considering bonuses for my employees. Has anything changed I need to know?”

Your HR Survival Tip

Employees typically love to receive cash bonuses at any time. However, as a business, you need to consider whether you are taking full advantage of this particular benefit so your business benefits, too.

The laws have become very picky about non-discretionary bonuses. A non-discretionary bonus is one that is expected and, often, the amount the employee might get is also known based on certain criteria. Many companies have had their bonus plan in place for so long it would likely be considered non-discretionary for legal purposes. Non-discretionary bonuses must now calculate an overtime amount based on any overtime worked by hourly employees over the bonus period. Yes, it’s another strange calculation California requires so let us know if you need help with it.

If you want a discretionary bonus plan, employees should haven’t any expectation of a bonus, should wonder if there will even be one, wonder when it might be, and have no clue about how much they might receive. Does your bonus plan fit this? If not, it could be considered  [click to read more …]

New Somethings from Newsom

California’s Governor Newsom must have writer’s cramp from signing so many bills into law. All the laws below are scheduled to go into effect on January 1st, 2020, unless someone manages to stop or change them. We have:

AB51 Mandatory Arbitration Agreements — The agreements have been seeing some changes but now we won’t be able to require employees to sign one to keep their jobs. Without the ability to force arbitration agreements, companies may see more lawsuits.AB707 Arbitration Fees — Steep ramifications may be seen if the party initiating an arbitration agreement fails to pay the appropriate fees within 30 days.AB5 Independent Contractors — This bill has already been discussed in the last two articles so we won’t waste your time repeating the information.AB749 No-Rehire Provisions — Often settlement agreements include a provision that the company will not rehire that employee. However, this bill prohibits that option so the ex-employee will no longer be automatically prevented from being rehired.AB9 Claims Extended 2 Years — The deadline for filing a complaint with the DFEH (Department of Fair Employment and Housing) has been extended to 3 years from the previous 1-year deadline. The DFEH handles all types of California’s harassment claims.SB142 Lactation Accommodation — We  [click to read more …]

New Rules for Contractors, Part 1

We’ve been waiting for more than a year to hear more information about independent contractors. Last year the California Supreme Court created the ABC test, which made it difficult to justify using independent contractors.

The decision to hire someone as an independent contractor lies with the hiring company. If your company misclassifies that worker, your company will be the only one held legally responsible. The contractor holds no liability so it’s important you do your due diligence. The default is they are an employee and they are subject to the ABC test.

The passing of AB5 clarifies who will be exempt from the ABC test. If they are exempt from ABC, they must instead pass the Borello test. Let’s first look at the parts of each test.

ABC Test

The workers must pass all 3 points. If they fail any of these, they must be an employee.

A — You can’t control the services or how the worker performs the work (this means you can only tell them the outcome you want, not how they get there).B — The work performed must be outside the usual course of your business (this means the work they do doesn’t touch your clients,  [click to read more …]

Rigid Policies

“We have new employees who are pushing back on some of our long-term policies. How do I deal with them?”

Your HR Survival Tip

Before dealing with employees who aren’t following your policies, first, stop and think about those policies. Are they outdated? Do they still fit the situation? Can you fully explain the intent of the policy so it makes sense to your employees?

We often see companies continuing a policy without even remembering why they created it…or whether it’s still relevant. Companies change and policy reviews ensure your policies are changing and keeping up with the company.

Example 1: You have a consulting firm and require a retainer when new clients sign up. However, you have now started hiring consultants who are bringing their clients with them to your firm. Many of those clients may not be happy to learn they need to pay you a retainer when they already paid a retainer at your consultant’s old firm. You may want two different policies regarding the treatment of new clients based on how you obtained that client.

Example 2: A new employee has an eligibility period for various benefits. That’s standard. However, what about rehires? Do they  [click to read more …]

Discriminatory Offers

“I think I’ve found a fabulous candidate for a position. However, he’s asking for an extra week of vacation each year. Do I just add that to the offer letter?”

Your HR Survival Tip

When you have a hard time finding good candidates, it’s easy to feel you must bend over backward to give them everything they want. However, before you bend, sit and think about how that wish list plays out.

Discrimination can hit many different areas within the workplace. When you look at the various equal pay laws, you see how much both the state and federal governments are trying to level things out. Even the Affordable Care Act (aka “Obamacare”) originally required all levels of employees to be offered exactly the same coverages for the same premiums.

When you are considering offering different levels of any benefit, you need to make sure the employees offered each level are clearly separate and identifiable. For example, you can create differences based on length of employment, field vs. office, management vs. non-management, etc.

When you choose to offer or give one employee more vacation time, you are creating a case for discrimination. Are you prepared to provide the same  [click to read more …]

Have a POP

“I just started offering health insurance to my employees. Now my broker is trying to sell me something called a POP. Do I need it?”

Your HR Survival Tip

First, congratulations on providing health insurance for your employees. We know that’s a big financial hit but it does make your company better able to recruit and retain employees.

Yes, you want a POP. This is a “Premium-Only Plan” that allows you to deduct an employee’s share of the premium on a pre-tax basis. Without having a POP in place, you must deduct from the after-tax, net pay. Since a POP is typically only about $150 per year, it’s a very low amount to spend to ensure your employee’s save money when they elect your insurance.

A POP is one part of what the IRS allows under Section 125 in the Internal Revenue Code. The other parts are usually just called Section 125 plans or Flexible Spending Accounts (FSA). These allow employees to set money aside on a pre-tax basis for healthcare expenses that may not be covered by insurance, such as over-the-counter medications, eyeglasses, contact lenses, etc. Another portion can be used to pay for childcare with pre-tax monies.

While  [click to read more …]

Raise Them Up

“I know the new minimum wage goes into effect on January 1st but does it change anything else?”

Your HR Survival Tip

California’s minimum wage sees another increase on January 1st in 2019 and 2020 and 2021, etc. However, that’s just the state minimum wage. Many of you may be subject to local laws that are higher or on a different schedule than the state law. San Diego, for example, will increase to $12.00 for anyone working within San Diego city limits.

The new minimum wage in California will be $11.00 (if you have no more than 25 employees) or $12.00 (if you have 26+ employees). Companies with no more than 25 employees will continue to be $1.00 behind larger companies until 2025 when all sizes will be paying $15.00/hour.

One thing the state law affects (and the local laws don’t) is the minimum salary you’re allowed to pay and have someone eligible as salaried exempt. Only the state law applies and it is a calculation based on the state minimum wage of [2 X state minimum wage X 2080]. No matter how few or how many hours your salaried exempt person works, they must be making at least $45,760  [click to read more …]