IRS Releases Revamped 2020 W-4 Form

For the first time in many years the IRS has significantly revamped the Federal W-4 form for 2020.  This new form will be required to be completed by all new employees beginning on January 1, 2020. Any existing employees who wish to make changes to their federal tax withholding after January 1st will also need to use the new version. Employers can ask, but cannot require, all existing employees to submit a new version of the W-4 form. However, if an employee hired before January 1, 2020 does not complete a 2020 W-4 employers must use the last completed W-4 to calculate appropriate federal withholding for the employee. Continue reading

Daylight Savings Time and Wage and Hour Compliance

For employees working the graveyard shift, this weekend could be a bit longer than normal. With the exception of Arizona and Hawaii, Daylight Savings Time ends this Sunday, November 3rd at 2 AM local time for all U.S. states. At this time, thetime-371226_1280 clocks will roll back to 1 AM and repeat the hour. If you have employees that work at that time, your payroll liability will likely be higher than on a typical work day because of the additional hour worked unless scheduling modifications are made. Continue reading

New DOL Ruling Increases the Salary Threshold for Exempt Employees

club-2492011_1920This morning the Department of Labor (DOL) announced the new salary threshold for exempt employees. Currently employees who meet certain job duties tests and are paid on a salary basis equal to at least $455 per week can be considered exempt from overtime. The new ruling increases the salary threshold from $455 per week to $684 per week. This new threshold is effective January 1, 2020.

The new threshold means that employers who have exempt employees making less than $684 need to either reclassify the employees as non-exempt (making them eligible for overtime pay when working more than 40 hours in a workweek ) or need to increase wages to be above the weekly minimum. Continue reading

Veteran’s Day a Required Day Off in Some States

Veteran’s Day, a day to commemorate and honor those who have served in our nation’s military in the past and present, is November 11. It dates back to 1918 when the fighting ceased on the eleventh hour of the eleventh day of the eleventh month during World War I. For this reason, November 11, 1918 is largely considered the end of the war “to end all wars.” It was in November 1919 that President Wilson declared November 11 as the first Armistice Day. In a speech he stated, “To us in America, the reflections of Armistice Day will be filled with solemn pride in the heroism of those who died in the country’s service and with gratitude for the victory, both because of the thing from which it has freed us and because of the opportunity it has given America to show her sympathy with peace and justice in the councils of the nations…” It was generally celebrated with parades and cessation in business beginning at 11:00 am.

However, much has changed since November 1919. Through the hustle and bustle of modern-day business, it has caused much confusion about how employers should observe Veteran’s Day and what legal obligations they have. In Iowa, Massachusetts, New Hampshire, and Oregon employers may be required to provide veterans a day off if they are normally scheduled. Continue reading

IRS Announces Increased 401k Contribution Limits for 2019

The IRS has announced today that the individual contribution limit for 401(k) plans in 2019 will increase from $18,500 to $19,000.  Individuals age 50 or over will be able to contribute an additional $6,000 per year as a catch up contribution.

There were also changes announced to other types of retirement plans, you can read more details regarding these changes here: Notice 2018-83.

Michigan Employers: New Paid Sick Leave Law

Update (1/5/2019):

The Michigan paid sick leave act has been signed into law, and with that several amendments were made.

* The law will go into effect on March 29th, 2019.

* Only employers with 50 or more employees will be required to participate.

* Regardless of participation, all employers in Michigan are required to post the Michigan Paid Sick Leave labor law poster in their places of business.

* There will be exemptions for several types of employees, including, but not limited to overtime exempt employees, temporary employees, and employees who are already covered under a collective bargaining agreement.

* Previously the act stated that each employee would need to accrue 1 hour paid sick leave per every 30 hours worked, due to the amendments this has been updated to 1 hour for every 35 hours worked.

* The original amount of paid sick leave an employer would have been required to allow was 72 hours per benefit year, this has been reduced to 40 hours. The same numbers were adjusted for the required carry over amount.

Michigan has recently joined other states in passing legislature that would require employers to provide paid sick leave to all employees beginning in March 2019.

The paid sick leave law and the new minimum wage law (read more about that here!) were passed with the intention of amending them after the general election in November 2018.  Both were to appear on the ballot this November but now will not as they have already been signed into law. By passing them as laws prior to the hammer-485712_1920election, Congress is now only required a majority vote to amend the laws rather than a vote of three fourths if the initiatives had been passed on the ballots in November.

As the law stands in September 2018 (subject to any future amendments), all employers in Michigan would be required to provide paid sick leave to all employees (full time, part time, temporary, etc). Employees must accrue 1 hour of paid sick leave for every 30 hours of work performed. Continue reading

Minimum Wage to Increase for Michigan Employees

The state of Michigan has recently passed a law that will gradually increase the minimum wage for non-exempt employees to $12.00 per hour by January 1, 2022.  The state minimum wage applies to all Michigan employers with two or more employees who are 16 years of age or older.

In the past, Michigan has allowed employers to pay tipped employees 38% of the minimum wage, but that percentage will gradually increase to 80% of the minimum wage by January 1, 2022.  Continue reading