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Before & After the Hire: Finding, Keeping & Tax Reporting PowerPoint Presentation
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Before & After the Hire: Finding, Keeping & Tax Reporting

Before & After the Hire: Finding, Keeping & Tax Reporting

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Before & After the Hire: Finding, Keeping & Tax Reporting

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  1. Before & After the Hire: Finding, Keeping & Tax Reporting

  2. Topics • New Hire Planning • Finding Prospective Employees • Interviewing • Orientation • Employee Files • Worker Classification • Federal and State Identification Numbers • Withholding, Depositing and Tax Reporting • Performance Appraisals • Termination of Employment

  3. HR Laws • Over 400 federal laws pertaining to employee rights and selection • States may also have laws that parallel the federal legislation • Laws can apply to employers based on different parameters • Number of employees • Government contracts

  4. HR Laws • Civil Rights Act of 1964 – cornerstone anti-discrimination legislation in the United States • Title VII of the Act pertains to labor and employment. Purpose is to prohibit barriers to employment which discriminate based on sex, race or religious beliefs • Equal Employment Opportunity Commission was created to enforce Title VII of the Civil Rights Act of 1964

  5. HR Laws • Other related acts include • Age Discrimination in Employment Act of 1967 (EEOC) • Rehabilitation Act of 1973 (OFCCP) • Executive Orders 11246 and 11375 (OFCCP) • Pregnancy Discrimination Act of 1978 (EEOC) • Fair Labor Standards Act as amended by Equal Pay Act (EEOC) • Americans with Disabilities Act of 1990 (EEOC) • Civil Rights Act of 1991 (EEOC) • Immigration Reform and Control Act of 1986 (United States Citizenship and Immigration Services)

  6. Planning for New Hires • Do you need the job? • What is the purpose of the job? • Who is currently performing these tasks? • Is there enough work for a full-time position? • Is the added business the result of cycle or is the pace permanent? • Can another employee do this job along with current responsibilities? • How much will the position cost?

  7. Planning for New Hires • What are your options? • Project – clear understanding of when the project is over • Contractor – area of expertise- hire an HR consultant for Employee Handbook • Temporary – less than 6 months • Limited term – more than 6 months but not a regular employee • Regular employment – never say permanent – may be eligible for benefits

  8. Planning for New Hires • Other considerations • How will I find candidates? • What is the budget? • Running an ad • Meals, Lodging, Gas • What is the hiring timeframe?

  9. Planning for New Hires • Job Description • Job description • Job Title and location • Required qualifications - employee must be able to perform these functions • Preferred qualifications – employee may be called upon to perform if necessary • Special skills required (operate special equipment) • Special licenses or certificates • Salary range

  10. Finding Prospective Employees • Temporary Agency • Employee Referrals • Recruiter • Job Fairs • Newspaper Advertisement • Internet Job Board • High School Work Program • Local Colleges or Technical Schools • Department of Labor

  11. Finding Prospective Employees • Senior workers • Stay at home moms returning to the workplace • Former military personnel • Career changers

  12. Finding Prospective Employees • Internet Job Boards - Pros • Free if you post on company web site • Recruiting is limitless – anyone with computer access can see the advertisement • Available 24/7 • Provide more information about organization and opportunities • Internet Job Board - Cons • Not everyone has access to the Internet • Have to drive applicants to the web site • May receive better response than anticipated • Competition can see your job posting • May not get the right results • Takes time and research to determine the best site for your company

  13. Finding Prospective Employees • Internet Job Boards • Career Builder • Flip Dog • USA Jobs • Indeed • Hot Jobs • Regional

  14. Interviewing • Who should you interview? • Review resumes or applications • Compare required job elements to the resume • Look for results from previous job • Look for gaps in work history • Look for relevant experience • Appearance • Grammar or Spelling errors • Applications should meet legal criteria

  15. Interviewing • Prepare a list of interview questions • Career goals • Education • Work experience • General skills and aptitudes related to the job • Ask open-ended questions • Avoid age/race/sex questions • Tell me about yourself • Why not to use this in an interview

  16. Interviewing • Sample Interview Questions • Tell me about your experience working with a team. • Tell me about a work situation that required excellent communication skills. • Have you ever been involved in a dispute with a coworker? What was it about and how was it resolved? • Tell me about a time when you handled an irate customer. • What do you like about working in customer service? • Tell me about a time when you failed to reach a goal. • Describe the best manager you ever had.

  17. Interviewing • Questions Not to Ask – even in casual conversation with the candidate • How old are you? • Are you married? What does your spouse do for a living? • How many children do you have? Ages? Are you planning to have any children? • What are your child care arrangements? • Have you ever been divorced? • Where were you born? Where were your parents born? • Have you ever been arrested? • What church do you belong to?

  18. Interviewing • Things to avoid • Treating interviewees differently – same panel, same test, same questions, same environment • Asking questions that may violate Title VII laws • Reading the resume back to the applicant • Using company acronyms • Talking about yourself instead of allowing the applicant time to speak.

  19. Interviewing • How to conclude the interview • Make sure all of your questions have been answered • Ask the candidate if they have any questions • Tell the candidate when they can expect to hear from you • Thank them for coming and escort them out of the building

  20. Screening • References • Verbal reference check • No comment policy - dates of employment, title and salary • Written letters of reference • Official transcripts • Background investigations • Credit checks • Advisable for positions with financial responsibilities • Applicant must give permission in writing • Use a service that screens candidates

  21. Job Offer • Determine which candidate • Make the offer verbally • Title, start date and compensation • Will you negotiate? • Know the terms before beginning this process • Do your homework – research salaries and compensation in the area • Don’t try to wing it through this process – have a list and stick to it • Follow up in writing but do not imply permanence • State salary in terms of pay (weekly, biweekly, etc) • This letter does not constitute a specific term of employment

  22. Prior to First Day On the Job • Create a training plan • New Hires do not hit the ground running • They don’t know the business • They don’t know your expectations • They need to be acclimated to the environment • Determine how employee’s progress will be monitored • Set timeframes to monitor progress • Prompt feedback will be appreciated • Choose a mentor • Have a work space ready (desk/phone/computer)

  23. Orientation • First Day on the Job • Orientation • Offer Letter • Required paperwork • Employee Handbook • Introduce the Mentor • Review and discuss the Training Program • Provide Lunch • Check on new hire at end of day one

  24. Orientation • Employee Handbook • Convenient source of information for employees • Disclaimer that handbook is not a contract of employment • Disclaimer that practices and procedures may change without notice • At Will Employment Statement • Avoid statements with company “guarantees or promises” • Signed acknowledgement that employee has received the handbook

  25. Orientation • Employee Handbook • Introduction • EEO Statement • Non-Discrimination/Harassment Policy • Americans with Disabilities Act Policy Statement • Confidentiality Agreement • Compensation • Performance Evaluation Schedule • Payment of Salary • Overtime Pay • Employee Referral Program

  26. Orientation • Employee Handbook • Time Off Policies • Vacation • Personal Time • Sick Leave • Holidays • Jury Duty • Military Leave • Family Medical Leave Act (FMLA) • Employee Benefits • Insurance (Medical, Dental, Life) • Short Term or Long Term Disability Plan • Workers’ Compensation Benefits • Retirement Plan

  27. Orientation • Employee Handbook • On the Job Policies • Attendance • Drug and Alcohol Abuse • Employee Assistance Program • Violence in the Workplace • Open Door Policy • Use of Company Equipment • Accidents and Emergencies • Voice Mail Policy • Email and Internet Policy • Cell Phone Policy • Tuition Reimbursement Policy • Leaving the Company • Resignation • Dismissals • Other Termination Procedures

  28. Employee Files • Start an Employee File • Employment Application • Resume • Federal and State Withholding Allowance Certificates • Other Employee Benefit Forms • Medical insurance • Life insurance • Acknowledgement of Receipt of Employee handbook • Confidentiality Statement • Non Harassment Statement • Disciplinary Action • Performance Appraisals

  29. EmployeeFiles • Medical Information should be kept in a separate file • Information gathered during the interview process should be kept in a separate file • I-9 Forms should be kept in a separate file. • Forms can be audited by the U. S. Citizenship and Immigration Services. Do you want them to have access to personnel files? • New I-9 Form link below: •

  30. Worker Classification • Independent Contractors • Common-Law Employees • Statutory Employees • Statutory Nonemployees

  31. Independent Contractors • Right to control ONLY the result of the work • Consider Common-Law Rules • Behavioral control • Financial control • Type of relationship to the parties • Substance of relationship governs worker’s status – not label

  32. Independent Contractors • Examples • Roofing company performing work for a general contractor • Electrician contracting for wiring an apartment complex • Trucking company that operates its own fleet and contracts with companies for deliveries. Drivers are paid for by the trucking company.

  33. Common Law Employees • Right to control what will be done and how it will be done • Common Law Rules • Corporate officers are generally employees

  34. Common Law Employees • Examples • Truck driver that operates a company owed truck, even if he has the option of which deliveries to make. • Tile setter that uses his own tools at a construction site, but performs work according to the order and specifications of the contractor. The contractor also supplies all materials and makes frequent inspections, pays him on a piecework basis and provides worker’s compensation insurance.

  35. Statutory Employees • Independent contractors under common law – treated as employees by statute for social security and Medicare taxes • Four categories – two are subject to unemployment taxes

  36. Statutory Employees • Driver who distributes beverages (other than milk) or meat, vegetable, fruit or bakery products; or who picks up and delivers laundry or dry cleaning, if the driver is your agent or is paid on commission. • Full-time life insurance sales agent whose principal business activity is selling life insurance or annuity contracts, or both for one life insurance company.

  37. Statutory Employees • Individual who works at home on materials or goods that you supply and must be returned to you or a person you name, if you also furnish specifications for the work to be done. • Full-time salesperson who works on your behalf, turns in orders to you from wholesalers, retailers, contractors, or operators of hotels, restaurants, or other similar establishments, the goods sold must be merchandise for resale or supplies used in the buyer’s operation and the work is the salesperson’s principal business activity.

  38. Statutory Employees • Social Security and Medicare are withheld if: • The service contract states or implies that substantially all the services are to be performed personally by them, • They do not have a substantial investment in the equipment and property used to perform the services (other than an investment in transportation facilities), and • The services are performed on a continuing basis for the same payer.

  39. Statutory Employees • Statutory Employees are also subject to FUTA, except: • Full-time life insurance sales agents and • Individuals who work at home on materials or goods that you supply.

  40. Statutory Nonemployees • Treated as self-employed • For federal income taxes • For federal employment taxes • All payments for their services are based on output • Their services are performed under a written contract providing that they will not be treated as employees for federal tax purposes

  41. Statutory Nonemployees • Direct sellers • Engaged in selling consumer products in the home or place of business other than a permanent retail establishment. • Engaged in selling consumer products to any buyer on a buy-sell basis, a deposit-commission basis, or any similar basis prescribed by regulations, for resale in the home or at a place of business other than in a permanent retail establishment. • Engaged in trade or business of delivering or distributing newspapers or shopping news.

  42. Statutory Nonemployees • Licensed real estate agents • Licensed agents not paid by the hour • Appraisers if they earn income based on sales or other output.

  43. Statutory Nonemployees • Companion Sitters • Furnish personal attendance, companionship or household care services to children or to elderly or disabled individuals. • Must be paid directly by the person receiving the services or the guardian, not by an agency.

  44. Determination of Classification • You can file form SS-8 • IRS will determine classification based on circumstances described • You must then follow IRS determination

  45. Obtain Necessary Federal and State Identification Numbers • Federal Employer Identification Number • Form SS-4 • • State Withholding Number • Department of Labor Account Number

  46. Withholding Requirement • Payments subject to tax • All compensation for services performed, whether cash or other form • Employees may be salary, hourly, piecework, tip or commission based • Federal income tax • Withhold based upon employee’s Form W-4 • State income tax • Withhold based upon employee’s Form

  47. Withholding Requirement • Social Security Tax • Employee and employer rate is 6.2% (Total 12.4%) • 2010 wage base limit is $106,800 • Medicare Tax • Employee and employer rate is 1.45% (Total 2.9%) • No wage base limit

  48. Withholding Requirement • Qualified insurance premiums are not subject to federal income tax, social security or Medicare tax • Qualified retirement contributions are not subject to federal income tax

  49. Depositing and Reporting • Must deposit all withheld taxes (including employer’s portion) • Monthly and Semiweekly deposit schedules are determined based upon the total tax liability you reported during a four-quarter look back period • Look back period is most recent four-quarter period beginning July 1st and ending June 30th

  50. Depositing and Reporting • Monthly Depositor • Tax liability less than $50,000 in look back period • New employers • Deposits due by the 15th of the following month • If the total liability for the quarter is less than $2500, payment can be made with the 941 quarterly tax return