Ah, December—a busy and tumultuous time for many businesses . . . a time of holiday office parties, secret Santa exchanges, and most important to many—time off to spend with family and friends.  When December rolls around and employees are itching to clock out, does your company’s holiday pay policy look more like It’s a Wonderful Life or does it look more like How the Grinch Stole Christmas? Much of how your company shapes its policy will depend on the needs of the business (and of course, the holiday spirit!), but when it comes to legal requirements for holiday pay, this employer’s guide to common questions and answers can help.

Q: Must employees get paid time off for nationally recognized holidays?

A: No.  Federal law doesn’t require employers to provide holiday time off, paid or unpaid.

Q: What about accommodating a religious holiday?

A: In short, yes, employers must accommodate their employees’ religious practices unless the business would suffer an undue hardship.

What is reasonable accommodation?  Allowing an employee to use a floating holiday, a vacation day, or unpaid time off are all reasonable ways to accommodate religious observances.

Q: Must employees be paid for employer-provided holiday time off?

A: This answer depends on the employee’s classification.  Employers are not required to pay hourly employees for holiday time off; employees must only be paid for time they actually worked.  On the other hand, employers are required to pay salaried employees who work without regard to overtime for holiday time off if they worked any hours in the holiday week.

Q: Must paid time off be included in determining an employee’s entitlement to overtime?

A: No.  Employer-provided paid holiday hours are not required to count toward an employee’s hours worked ,for the purposes of determining overtime eligibility.  Typically, an employee must work 40 hours in a week to become eligible for overtime.  This may be overridden, however, by collective bargaining agreements.

Q: Can conditions be attached to holiday pay?

A: Yes, but those conditions should always be in writing.  As examples, an employer may prorate holiday pay for part-time employees or may require a certain amount of service time before an employee becomes eligible for holiday pay.

Q: If an employee works a holiday, must they get premium pay?

A: While a common practice (and a kind gesture) to pay a premium to employees who work holidays, it is not a legal requirement.

Q: Must the same holiday benefits be extended to all employees?

A: No, as long as any differences are not a result of potential discrimination, such as age or gender.  Employers can, for instance, grant holiday pay to full-time employees only, or to office workers instead of field workers.

Q: What happens if a holiday falls on an employee’s regular day off or on a non-business day?

A: No legal requirement governs this area; however, a popular practice is to allow employees to take another day off during that pay period.  This is typically seen when holidays like Christmas fall on a Sunday and employees are given the following Monday off.

When it comes to managing your company’s payroll services, GHRO can help!  Our seasoned professionals have years of experience in Human Resources and can help you develop the best policies for you and your employees.  For more information about how GHRO can meet your business needs, visit our website.

Everyone’s favorite federal organization, the IRS, recently released guidelines to help business owners distinguish employees from independent contractors.   The IRS is following up these guidelines with random audits of employee classification.  Sure, classifying an independent contractor can save your business money in taxes, overtime, and workers’ compensation, but if the IRS finds the contractor should actually be an employee, that business will face stiff penalties.  To avoid this costly and all-too-common mistake, remember these tips the IRS wants you to know about classifying employees.

1.  The IRS uses three characteristics to determine the relationship between businesses and workers: behavioral control, financial control, and type of relationship.  All of these factors will affect whether a worker is rightly an employee or an independent contractor.  If a business has behavioral control, it has the right to direct or control how a worker performs the work, via instructions, training, or other methods.  If a business has financial control, it has the right to direct or control the financial and business aspects of the worker’s job.  Finally, the IRS examines the type of relationship, or how a worker and the business owner perceive their relationship.

2.  If you, the business owner, have the right to control or direct the work to be performed and also how the work will be performed, then your workers are most likely employees.

3.  If you, the business owner, can direct or control only the result of the work to be performed—and not how that result will be achieved—then your workers are most likely independent contractors.

4.  If you have misclassified workers as independent contractors, you may face a hefty bill come tax time.  In addition, the IRS can assess penalties for failure to file required tax forms and pay employment taxes.

5.  If any doubt remains whether a worker should be an employee or an independent contractor, both employers and workers can file IRS Form SS-8: Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, which lets the IRS make the classification call.

“Employment law.” If those words sent a shiver down your spine, you’re not alone. You have so much to think about to keep your business running at its best, the last thing you want bogging you down is employment law! Employment law is complicated, confusing, and ever-changing—and unfortunately, it’s critical to you and your employees that it be followed to the letter. To help you out, GHRO has compiled a list of five common workplace violations you’ll want to look out for.

1. Unpaid or Incorrect Overtime Pay

According to the Fair Labor Standards Act (FLSA), all work over the employee’s regular 40-hour workweek must be paid at time and a half. Note, California’s overtime laws are based not only on a 40-hour workweek, but also an 8-hour workday (except for certain employees on a modified work schedule, such as a 4/10). Any work performed in excess of eight hours in one workday is considered overtime, paid at time and a half, as well as the first eight hours worked on the seventh day of work in any one workweek. Similarly, work performed in excess of 12 hours in one workday shall be paid at double-time, as well as any work performed beyond eight hours on the seventh day of work in any one workweek.

Compensatory time may be granted instead of overtime wages, but it must be paid at the same rate: 150 percent.

Pitfall: If your business requires overtime to be preapproved, even if a non-exempt employee works “unauthorized” overtime, it must still be reported.

2. Minimum Wage Violations

As of July 24, 2009, federal minimum wage is $7.25 per hour. Many states have their own minimum wage laws; current minimum wage in California is $8 an hour. If a discrepancy exists between federal and state rates, the higher rate prevails. Under certain circumstances, minimum wage exceptions apply to special job groups, including tipped employees, full-time students, and disabled workers.

3. Unpaid Vacation Time

Employers are not legally required to pay employees for vacation time; however, if employers choose to provide paid vacation time, any accrued vacation time becomes part of an employee’s compensation package. That means accrued time must be paid out when an employee separates from the employer, whether through resignation or termination.

4. “Use It or Lose It” Vacation Time Policies

Some employers have adopted a “use it or lose it” vacation time policy, where if employees don’t use all of their accrued vacation during the calendar year, they will lose that time once the new year starts. In some states, “use it or lose it” vacation policies are unlawful.

5. Unpaid Compensable Time

Paid work time extends to more than just an employee’s job duties. If an employee spends time changing into a uniform, performing stock inventories, or setting up and cleaning a work area, that time is compensable. An employee is also entitled to wages for extra hours worked, such as working through lunch break, even if the employer didn’t require it.

Employment law has so many fine details, it’s tough to remember them all and implement them just right. One mistake can mean disaster! If employment law is getting you down, the Human Resources specialists at GHRO can help. Our professional staff stays on top of federal, state, and local employment regulations so you don’t have to! We’ll teach you the best way to adapt employment regulations to your business goals. Visit our website today to see how GHRO’s services can work with your business.

Brandon Carl, our Business Development Manager, chatting about Human Resources outsourcing and GHRO with Ciaran Foley on LookSee.TV!

2010-08-10 Brandon Carl and GHRO Discuss Outsourced HR from Ciaran Foley on Vimeo.

Our society is becoming so inundated with tasks and work-related duties that unhappiness at the office is encroaching on employee health. We all know that having happy workers limits turn-over and the higher the job satisfaction, the more likely employees are to put forth their best effort. By creating a fun and home-like working atmosphere, you’ll make work fun, enjoyable, and ease stress at the same time!

Google was voted the number one company to work for in 2007. It’s no surprise considering life at the search engine giant is very relaxed and stress free; employee benefits abound. While some companies stress time lines and attire, Google emphasizes recreating the home experience at work. Employees can do laundry, work out at the gym, receive a massage and learn a new language. Feeling a little under the weather? Visit Google’s on-site doctor. Buying a hybrid? Google will give you $5,000 towards the purchase price. Expecting a child? They’ll reimburse you up to $500 in take-out food. If you ask any employee what they do at Google they’ll typically respond a personal embodiment of the company’s mission statement- “to organize the world’s information and make it universally accessible and useful.” This kind of motivation by employees is rarely seen, but envied by most.

Google’s goal, as often recited by employees, is ambitious (to say the least). Thankfully, Google just happened to find the right people to take it on. By creating a comfortable work environment, employees are not burdened with stress. Instead, employees are motivated to collectively achieve a similar goal; indexing information and making it useful. Google wouldn’t be the tech giant it is today without its bevy of happy employees. The appeal of a work environment that mimics their homes stimulates productivity and increases employee moral, making Google one of the most sought-after employers in the world.

Even if you don’t have the resources of a Silicon Valley titan, you can easily follow Google’s ideology, making your employees happy too. The first step may just be rethinking how you see your company. Simply making the mission statement more accessible and personal will help employees insert more of themselves in to their work and ease stress levels. Extend the home experience to work and rethink the office; would you want to live in it? If you wouldn’t mind spending an evening or weekend at the office because it’s hospitable and welcoming, you’re on the right track. Make the office a place your employees love to be, rather than the place they dread to go.

Employees need to come first in a company, as they are the heart and soul of your business. Creating a comfortable work environment that mimics a home eases stress, raises morale and increases productivity. Even simple changes can greatly affect employee health and happiness in a positive way, which will certainly lead to long-term growth for your business.

To the relief of consumers, a large percentage of United States companies are bringing their call centers back to American shores. Many have found it difficult to interact with call center operators, as the operators often find themselves easily confused by slang and vernacular used by native English speakers.  Because of this disconnect in communication between caller and operator, callers are becoming less likely to use information or help hotlines and often ending their phone calls more bewildered than they began­– without the help, clarification, or instructions they were seeking in the first place.

In response to the widespread disappointment from American consumers, companies are bringing their call centers back home meaning ease in communication as well as an increase in jobs available across America.  While companies have previously found it very profitable to outsource jobs, the payoffs are now nowhere near as high as they used to be.  Inflation, as well as a rise in the pay expected in foreign countries, has pushed the cost of outsourcing to popular “call center countries” such as India and the Philippines through the roof.  Once companies began to take the cost and quality of service provided through their call centers into consideration, many began to bring their business back home to the States.

Another bonus for American firms seeking a solution to their call-center dilemma: they are now able to contribute further to strengthening the American economy.  Experts currently estimate that hiring someone in Nebraska to work at a call center costs only 15% more than hiring an employee in India.  Take into account any potential tax-breaks the company may receive for hiring new (American) employees, as well as the impact that employee could have on their local economy, and the benefits of an American-run call center begin stacking up.

American consumers are voicing their opinion about their feelings about outsourcing customer service overseas. Reports have been conducted that have found customers expressed more favorable feedback when they perceived a call center in the U.S.

A few facts about American Call Centers:

• Consumer satisfaction is 1/5 higher when calls are (or are perceived) to be handled within the United States.
• Consumers are more likely to have their problems solved when the person handling their call can understand the issue and properly articulate the solution.
• The opportunity cost of employing operators in other countries is beginning to far outweigh the benefit.
• U.S. companies are looking for cost-effective, economy-building labor solutions across the board.  Housing their call centers at home, rather than abroad, brings more employment opportunities for unskilled laborers and strengthens the lower classes.

While outsourcing call centers may have not been a viable option in the long run, companies are still looking for cost-effective options for their businesses.  Human resource outsourcing, such as benefits outsourcing, employee and labor relations, employee leasing, government compliance, HR audits, HR consulting, HR management, payroll services, and recruitment services, are becoming popular ways for companies to save time and money, allowing them to bring you better products and services for less.

It is not Wall Street, the large multi-national corporations or even the vast banking institutions that are the driving force behind the American economy. Small businesses remain the dominating factor that figure into the continuing success of the U.S. Economy. Small businesses with less than 500 employees support more than half of the private sector American workforce. By hiring a Professional Employer Organization (PEO) to help stay profitable in turbulent financial times, small businesses are able to reduce their operating costs, raise the efficiency of their management and stay competitive in the marketplace, thus keeping them playing a successful role in U.S. economy.

Small businesses do the following:

• Employ over half of America’s private sector workforce.
• Are responsible for hiring at least 40 percent of workers in the technological fields such as science, engineering and computer programming.
• Include over 50 percent of home-based businesses.
• Make up nearly all of the firms dedicated to employment.
• Generate the majority of new inventions and innovative breakthroughs in science and technology.

Despite the fact that banks and other lending institutions are currently creating more barriers than providing assistance to small businesses relying on loans to establish credit lines for commercial mortgages, vehicles, equipment and leases; as well as the fact that government regulations are making it increasingly difficult and more expensive per employee to stay in compliance, it has never been more crucial for small businesses to survive in the down economy.

Your PEO to the Rescue

For the reasons above, Professional Employer Organizations are coming to the aid of small business and providing hope for the future to many small business owners.

Why use a PEO? To help small businesses survive in a down economy,­­ a PEO will offer the following solutions:

• Establish an employer relationship by contractually assuming many employer risks by becoming the employer of record for government compliance, safety and worker’s compensation and employee/labor relations.
• Incorporate optional health benefits, 401k administration, general liability coverage, background checks, recruitment services and payroll services.
• Provide relief from the burden of HR management, employee benefits, employee leasing and HR audits.
• Improve employment practices, compliance and risk management in order to reduce a business’s liabilities.
• Allow access to a comprehensive administrative service, employee benefits and HR Consulting.

Being the little guy on the block is never much fun. However, small businesses are discovering finding that competitive edge has become easier with the help of a (PEO) professional employer organization.

Trying to establish and maintain a business presence in today’s marketplace is difficult enough for large companies but even more difficult for the smaller ones. This is why the little guys on the block are getting big help by choosing to take advantage of human resources outsourcing for recruitment services, HR management, government compliance, employee/labor relations as well as other HR functions.

The current economic climate is making it harder for small businesses to thrive. The high costs of employee benefits and government compliance are forcing organizations to explore new strategies to lower their operating costs to remain competitive. Human resources outsourcing provides the HR consulting and HR management that relieves employers of the many pressures of hiring, training and maintaining their staff.

Small businesses are cutting costs and increasing their efficiency by having an administrative services organization take over the responsibilities of payroll services, safety and worker’s compensation, employee leasing and other HR services.

Whether you have 2 employees or 2,000, utilizing a PEO can help businesses find talented employees as well as offer their management expertise to train and maintain them while lowering costs and saving the employer both time and energy.

A company’s goal is to succeed and become profitable. In many cases this means growth and expansion. A PEO understands the needs of both employer and employee. Their sole focus is to minimize costs while implementing an HR management structure to maximize efficiency.

Taking advantage of the cumulative experience of a PEO provider will help manage everything from employee relations to interpersonal communications between employees and customers.

Regardless of the competition, small business owners do not have to compromise on productivity or profitability. Small business owners can take advantage of the many opportunities for growth and success by using a professional employee organization to achieve the competent HR management that will give them the competitive edge.

A growing number of companies are choosing to incorporate human resources outsourcing into their business model. However, to be successful it takes professionals who are capable of implementing successful HR outsourcing strategies:

Top 5 HR Outsourcing Strategies:

1.    Recruiting Qualified Employees – With the evolution of technology, finding experienced employees who have the skills required to make a business successful in today’s marketplace is an integral part of the hiring process. Human resources outsourcing provides professional recruitment services that will focus on connecting the most qualified employees with the right employers. By utilizing the services of an HRO, PEO or ASO, companies gain access to a diverse workforce with a wide variety of expertise and skill sets. Bad hiring practices are a common mistake companies are finding very costly, resulting in substantial losses to their production and deeply impacting their bottom line.

2. Superior Training Techniques – Adequately training a workforce is time consuming and can drain a company’s resources without the critical input of human resources experts to establish well organized and successful training techniques. When neglecting to sufficiently train employees job performance and employee retention suffer and will ultimately reflect a company’s profits as well as their credibility. Training and development requires a company to be proactive. Relying on professional HR management for guidance and structure has proven to be vital for any business model.

3.  Employee Relations – Maintaining employees is complex and involves clear-cut policies that need to continually be communicated. Employee benefits, an employee handbook and employee/labor relations are all important business practices that are designed to cultivate a working relationship between business owners and employees. Avoiding potential problems and litigation is a critical aspect of HR that is significantly facilitated by a professional employer organization.

4. Observance of Government Regulations – Companies who do not comply with the mounting amount of changing local, state and federal regulations are subject to huge fines and must pay thousands of dollars per employee to comply.  While compliance is costly the penalties for not complying is more expensive. Keeping organizations up-to-date with these regulations takes the support of HR consulting services that specialize in government compliance.

5.   Employee Incentives – The key element to effective employee relations is to reinforce an employee’s value on a continual basis. Companies must motivate their employees to retain them. A management system designed to improve retention and employee/labor relations will reward the employee for their hard work and boosting job performance and output.