As some of you may have seen on Facebook, a new video with Jane Fonda has been making the rounds. It concerns the latest Department of Labor proposed rules concerning employer treatment of tips. Leaving the politics of Jane Fonda aside this is an important issue that needs to be understood. A great source to understand this issue is the latest post from Wage & Hour Insights written by Bill Pokomy on December 8th. I highly recommend you review his analysis of the proposed rule.
When conducting my webinars on the FLSA requirements one area always seems confusing to attendees and that is the eight types of payments that can be excluded when calculating regular rate of pay. The one found most often to be confusing to my attendees and maybe to you as well is the one that is for bona fide overtime premiums. Bill Pokorny has done an excellent blog post on this subject that I know you will find helpful on this topic. Please take the time to check it out if you offer this type of payment or to improve your general payroll knowledge.
On August 31st, the Judge in charge of the court case for the new OT rules initiated by President Obama issued its final ruling. Basically he sided with the plaintiffs. For an excellent recap of the ruling I am referring you to Bill Pokorny’s blog.
I recently had a discussion with an associate (also an payroll consultant) about the regular rate of pay and payroll systems in general. Unfortunately the question we both had, we could not fully answer. So I am turning to my blog followers to help me out. When I started in payroll we did payroll by hand, including the regular rate of pay calculations. Of course, systems have improved since 1977. But my question is…which current systems (whether in-house or service bureau) do regular rate of pay calculations? For example, I give a bonus to an employee for finishing a project on time (nondiscretionary bonus) and he earned it in the same week it was paid. For this scenario would your payroll system do the regular rate of pay calculation? Or would you have to do it by hand and add it in? Second example, an employee receives a monthly commission on sales (hourly employee). He is paid his commission on July 15th for the month of June. Would your system be able to recalculate the additional overtime due? Or would you have to do it by hand (Excel spreadsheet)?
If your system does not do the regular rate of pay calculation, did you know this when you bought the system or signed up for the service bureau?
I appreciate any input you might have on the subject. Please include the name of the system if you can do so. Also please note if you had to have a special program written to handle the calculations.
The Department of Labor (DOL) has just announced that they will reinstate the issuance of opinion letters. The action allows the department’s Wage and Hour Division to use opinion letters as one of its methods for providing guidance to covered employers and employees. An opinion letter is an official, written opinion by the Wage and Hour Division of how a particular law applies in specific circumstances presented by an employer, employee or other entity requesting the opinion. The letters were a division practice for more than 70 years until being stopped and replaced by general guidance in 2010.
“Reinstating opinion letters will benefit employees and employers as they provide a means by which both can develop a clearer understanding of the Fair Labor Standards Act and other statutes,” said Secretary Acosta. “The U.S. Department of Labor is committed to helping employers and employees clearly understand their labor responsibilities so employers can concentrate on doing what they do best: growing their businesses and creating jobs.”
The division has established a web page where the public can see if existing agency guidance already addresses their questions or submit a request for an opinion letter. The web page explains what to include in the request, where to submit the request, and where to review existing guidance. The division will exercise discretion in determining which requests for opinion letters will be responded to, and the appropriate form of guidance to be issued.
In addition to my own blog I like to make sure I follow other well written and accurate blogs that discuss wage and hour law or other payroll related items. The Wage & Hour Insights blog is one such blog. I have shared several of them in the past months. This time the blog addresses a unique situation but still one that is relevant to all payroll professionals. Do school employees get overtime for occasional extra duty? Why relevant to all payroll professionals? Because though the law does give a limited exception to state and local government employers it does not to private sector employers. So check out today’s blog from Bill Pokorny for government employees. But also check out his previous blog on the subject for private sector employers.
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The Office of Child Support Enforcement (OCSE) has submitted its Annual Report to Congress FY 2015. The report outlines its accomplishments and provides a status for the program. This fiscal year marked the 40th anniversary of the Child Support Program, which was established in 1975. In total, $32.4 billion in child support was collected in FY 2015. Of this $24.3 billion or 75% was collected through income withholding from the employee’s paycheck. Well done payroll professionals!
Our new white paper is on the topic of sending out a year end memo to your employees. This memo contains pertinent information that the employees need to know. So this memo not only helps your employees but also cuts down on questions coming your way from those same employees. We hope you find the information useful.
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This has been a question I have been asked ever since I began in payroll in 1977. Does payroll report to human resources (personnel way back then) or to finance? Where should the functionality and operations of payroll be housed? And it is not a questions with a simple answer.This age old question is the heart of the APA’s next PayNewsChat on Thursday, December 8 at 3pm Eastern time. Dan Dycus, CPP, APA’s Senior Director of Education Services, and Jodi Parsons, CPP, Director of Payroll for the Kansas City Royals Baseball Club, will share their thoughts with you during this half-hour talk at #PayNews Chat. You can be of the conversation by using the chat portal Twubs or participate directly on Twitter by following along with #paynews and including the hashtag in your tweets. Be a part of the conversation if you can.
Yesterday I attended the second day of the APA’s Virtual Congress. I found the webinars highly informative and loved the interaction in the chat room. One of the webinars I attended live was the “Developing a Successful Payroll Service Delivery and Staffing Model” presented by Robert Gerbin, SPHR, who is a Global HR and Payroll Operations Consultant for Ernst & Young, LLP. While the webinar contained excellent information on staffing and maintaining a payroll department, Mr. Gerbin brought up a unique question that I have never encountered before. And what was this question? Mainly should the Payroll Department be called “The Payroll Department”? So why should be change our name? According to Mr. Gerbin, since payroll departments do so much more than “process payroll” why not make the name reflect the actual work being done. Payroll is both a tactical and a strategic business process. There are tremendous responsibilities. Failure to carry out these responsibilities correctly and with deadly accuracy can result in heavy fines, have a negative impact on operations, severely damage employee moral and result in negative publicity to the company. The title proposed is an excellent one. Payroll Services. We process payroll, handle general ledger interfaces and files, administer garnishments, interact with management, process benefits, and withhold, administer and report taxes. Why not let our name reflect that? Just as when “personnel” became Human Resources we should become Payroll Services.
What do you think?