Contributed by Danielle Feiger, Senior Sales Manager at Timesheets.com.
There are many reasons and instances in which a business would need to track employee training. Many times, employees need to maintain training to stay up-to-date on changes in their industry or require it for their profession. If you’re tracking your employees’ time online, you should track their training online, too.
Our blog attracts both employers and employees who are searching for answers to their employment related questions. Last week, one of our posts, When is an Employee Paid Double Time, attracted the attention of a Californian employee who felt he was being abused by his employer, or at least, so I gathered from the tone in his comment.
Employers have always faced penalties for misclassifying employees as independent contractors but now, with the Affordable Care Act (ACA), some employers are finding yet another reason to try to skirt around the law.
Under the ACA, employers with 50 or more employees are required to offer health benefits to their workforce. If they don’t make health benefits available by the deadline, the company pays a penalty. You can see, then, how some companies might want to report having fewer than 50 employees so that they don’t have to offer health benefits. One way to achieve this is to classify some of that workforce as independent contractors. But this isn’t right and it will get you into trouble if you do it.
Making a mistake on your employee’s payroll obviously costs the employee their due wages but it can also cost you, the employer, in lawsuit damages. This is the last place you want to end up. Wage and hour lawsuits are expensive. And with the Department of Labor planning to hire 300 more investigators, small businesses will be even more at risk for getting caught.
Some of the most common mistakes companies make that can lead to incorrect payroll include:
Overtime violations fit into a category called wage theft. And the thieves are, in this case, not the poor or needy, but the more fortunate business owners. While they would hardly call themselves thieves, they essentially steal wages from the poor and the needy: their low-wage employees. Sometimes business owners and managers do this by accident but most of the time they are trying to cut corners and save money by either:
- Withholding overtime
- Making employees work off the clock
- Tip withholding
- Paying employees under the minimum wage
According to a report from the University of California, overtime violations are a big problem. The authors state that,
Do you know what qualifications an employee must meet to be classified as salaried? They must make at least a certain wage per week and do professional work, right? Sounds pretty stringent but as it turns out the salary requirements are quite low and job classifications are very lax. Many employees end up doing low level work for very low wages and aren’t even eligible for overtime pay.
President Obama has in mind to change this. He is pushing to increase the salary limit for employees exempt from overtime as well as make other changes in the way they are classified.
Many business owners like to convert overtime to comp time both to save money and to give employees an optional benefit, but beware; this practice might get you into trouble.
Converting overtime to comp time is fine if you are a government employer but private sector companies have no legal right to do this. (Take a look at the Department of Labor website for detailed information on this.) For non-exempt employees, employed by a private company, employees must be paid overtime at 1.5 times the rate of pay. This cannot be transferred as credit for days off. It must be paid through payroll.