Thursday, June 24, 2010

Are Garnishment Limits on the Rise?

As I was reading my daily news updates and preparing them for distribution to my newsletter subscribers I found a very interesting item on an area that doesn’t get changed very often. Florida is amending its wage garnishment provisions to increase the amount of wages exempt from creditor garnishments. This applies to the head of household or head of family category. They are increasing it from $500 to $750 a week. Anything under that limit cannot be attached or garnished. It allows for the garnishment to take place if the person agreed to it in writing. But it provides the form to be used for the agreement to waive the exempt to garnishment. It is very rare that these types of amounts are changed. It usually only happens when the minimum wage is increased or they haven’t been changed for many years.


Another reason I find this interesting is the wave of questions I have been getting lately concerning payday loans or personal loans at payday stores. When a person gets such a loan, it appears, they sign a letter that states they agree to allow the amount to be deducted from their wages if they don’t repay the loan. So payroll professionals are unsure sometimes whether to honor the agreement. Most that I know do not as they are a voluntary wage assignment and employers are not legally bound to honor them in most cases. But I was wondering if this increase in the amount subject to garnishment in Florida and the fact that they now have a special form to use and the growth of payday loans is somehow related.

So will we be seeing a rise in garnishment limits in the future in large numbers or is this a one-off case for just Florida? We will have to wait and see.

In the meantime, have you been getting any requests from payday loan type establishments wanting you to honor withholding agreements? Let us know how you handled it.

Wednesday, June 23, 2010

Have You Heard the Latest?

This is the information age for sure. We are all constantly bombarded with news and updates—practically 24/7. But is it useful information, that is the question. Nine times out of ten it is not. But current information is vital to today’s payroll professional. Changes occur daily, weekly, and monthly nowadays rather than just annually in January as in days gone by. With the Form 941 changing in April two years in a row, COBRA subsidy extensions coming in ad nauseum , and states changing or updating laws all year long it is surely a best practice to make sure you are getting the current information—shall I dare say “currently”.


But what is current in this electronic age? Even 5 years ago getting a monthly or a biweekly newsletter was sufficient to keep the payroll professional informed. But today it is just too slow. Newsletters may come electronically but they are still composed the old fashion way. They need to be written, then edited, desktopped, then finally distributed. So by the time the newsletter lets you know that the Form 941 has been updated for the second quarter and how to handle it is coming soon, the IRS, who is working in real time, has not only posted the form, but the instructions, the FAQs, and the corrections to their website.

Don’t get me wrong, newsletters are still very valuable. They are able to give you the full story, the details that a news bulletin cannot. But that is for later, when you are studying the information, not when you need to know about it now. So how does one obtain this up-to-the-minute news? Actually by spending a little time, you can acquire it very easily.

All of the federal agencies and most of the state agencies as well, now offer free e-mail news updates along with their monthly newsletters. By taking the time to go to each website and sign up you can have this information right at your fingertips at the same time as the large payroll news services and for free to boot.

It will cost you some time to sign up, after all nothing comes without some cost. Most states have a minimum of two sites that you will need to sign up for--one for taxes and one for wage and hour law. In addition other states divide up the responsibilities for the taxes. One agency may handle income taxes while another handles unemployment insurance. But it is well worth the time you spend on this.

If you have a staff you may want them to read the updates as well. You can distribute them via e-mail of course. Some departments are actually setting up a special e-mail address for these types of updates. That keeps the updates from being caught in spaminators or getting lost in the clutter of your e-mail first thing in the morning.

Now for a commercial break! Hey it’s my blog. Those of you have been reading this blog over the last couple of months know that I don’t usually do commercials for my company. But it just so happens that I am starting a news service for payroll professionals. As I have signed up for these services that I advocate here plus I pay for several other services I am certainly on top of the breaking news. Right now I am posting a small portion of these news items on my website. However, I am setting up a brand new website starting July 1st. At that time I am offering a subscription service to the Payroll Advisor’s E-News. For a small fee you can receive the latest news from the IRS, DOL, SSA and all 50 states for wage and hour as well as SIT and SUI changes right to your designated mailbox. I have been asked to do this for years and now I finally have the means and method to do so. So visit my new website after July 1st and sign up for a 30-day free trial subscription.

If you sign up for the e-mails directly you should be aware that there will be chaff with the good stuff. Depending on how the state sets it up you may get sales tax info along with withholding. With the IRS you will get a lot of CPA type updates along with the payroll news. But again well worth the quick scan to see what you need to read further.

So whether you sign up directly or use a payroll news service keeping up-to-date on payroll news and information is definitely a best practice.

So how do you keep up to date?  Let us know.

Monday, June 21, 2010

It Bears Repeating--Let's Have A Lunch Break

Today I want to repeat a blog I did on May 3, 2010.  It is about something that has bothered me for a long time. And that is the fact that the United States has no federal law that requires employees to receive a meal period. There are states that do require a meal period. Check the link http://www.dol.gov/whd/state/meal.htm for a list from the DOL’s state laws page. Less than half or 20 out of 50 states plus DC require a meal period. That means that while employees in California, Nevada, Massachusetts or Rhode Island for example are entitled to take time to eat, employees in Mississippi, Florida or Georgia must rely on the kindness or good will of their employer to eat a meal.

That is why my question today is simple: Why is there no law under the federal rules to require an employee to receive a lunch break? It’s not necessary is one argument I hear constantly. No employees would work for a company that didn’t give them a lunch. I actually had that discussion during lunch at the International Association for Human Resource Information Management Exposition. The HR professionals all agreed to that premise. Maybe in good times when jobs are plentiful, but what about these economic times? Or in low pay jobs?

Another argument against regulating lunch is that it is such a common practice in most cases so there’s no reason to have to legislate it. But is it common practice or common myth? If you follow the DOL on their audit information they release or court cases you know that failure to pay employees when they have worked through a lunch is actually quite common. In other words employers illegally dock employees for lunch when they haven’t taken it so what makes anyone think that they are offering lunches to everyone when not required to.

I am not asking for a paid lunch. But simply require that all employees within the United States regardless of the area of the country they live in deserve and are entitled to 30 minutes to eat lunch during the course of the work day. This wouldn’t be that hard. Other industrial nations offer it. 20 states offer it. And unlike the minimum wage that is actually based on the economics of the area where the employee works eating lunch is not. I totally agree that the cost of living in Kansas may be lower than in California so each state should be free to set a higher or lower minimum wage than the other. But the need to take time to eat food during the course of an eight hour day is not decided by geographical location.

Maybe payroll professionals should rise up and start the “Let’s Have Lunch” movement to make the law universal to all employees in all states. It certainly would make our job easier if the laws were more streamline. That’s my thought for today on wage and hour law…what do you think?