South Carolina bars subdivisions from mandating benefits

South Carolina Governor Henry McMaster has signed a law that prevents political subdivisions from setting mandates on private businesses to provide employee benefits such as health benefits, disability benefits, death benefits, group accidental death and dismemberment benefits, paid days off for holidays, paid sick leave, paid vacation leave, paid personal necessity leave, retirement benefits, and […]

Puerto Rico labor and flexibility law provisions summarized

Puerto Rico recently enacted the Labor Transformation and Flexibility Act, on January 26, 2017 (see Payroll Management Guide Report Letter 1488/2495, dated February 28, 2017). The law contains numerous changes on employment contracts, exclusions, independent contractors, employee rights, contract termination, statute of limitations, overtime, vacation and sick leave, gross income, and unemployment insurance (flexicurity). Employment […]

Illinois eliminates annual withholding for most employers

The Illinois Department of Revenue has amended regulations to eliminate annual personal income tax withholding returns and payments for most employers. Taxpayers who employ domestic employees may continue to report and pay withholding tax on an annual basis. Effective before January 1, 2017, employers in good standing who reported $1,000 or less in withholding during […]

Arizona issues alert for Form W-2 email phishing scam

The Arizona Department of Revenue has issued a news release warning employers about a Form W-2 email phishing scam that attempts to steal employee W-2 information from company payroll or human resources departments. Cybercriminals may send an email to a payroll office or human resource employee requesting employee W-2 data and, in some cases, payroll […]

Employer may violate minimum wage if tip credit is applied

Although an employee did not allege that she failed to receive the minimum wage when including all the tips she received as a server, that deficiency did not preclude her from stating a claim for a minimum wage violation, ruled the Tenth Circuit. The appeals court rejected a district court’s conclusion that “if [a] tipped […]

Iowa law bars local laws exceeding state or federal minimum wage

Iowa bars counties and cities within the state from setting their own minimum wage and other employment laws that exceed or conflict with laws enacted by the state or federal government. The bill, H.F. 295, goes even further to declare that any county or city law previously enacted that conflicts with the proposed law’s provisions […]

Withholding required on employee discounts taxed to employees

Only employees can qualify for a nontaxable fringe benefit. Under Code Sec. 132(a), an employee is defined as an individual currently employed by the employer, an individual who has retired from the employer, has become disabled while working for the employer, or is an employee’s widow/er or dependent children under age 25. An individual not […]

Common-law employer liable for employment taxes

An S corporation was the common-law employer of the workers at issue; therefore, the taxpayer was liable for the proposed employment taxes. The taxpayer operated a limousine transportation business and employed workers through a professional employer organization (PEO) to perform services in the various departments. Although the taxpayer referred to the workers as “co-employees,” the […]

Worker tax information discoverable in worker reclassification case

The disclosure of third-party taxpayer information needed to absolve an employer of his tax liabilities in a worker reclassification case was not barred under Code Sec. 6103. Moreover, the worker’s tax information was discoverable even though the taxpayer/employer had the burden of proving that the workers paid their income taxes to get relief. After an […]

Pre-employment training was noncompensable

On-the-job training for new employees can be time-consuming and disruptive of regular work operations. What’s more, if the newbie actually performs work (even ineptly or inefficiently), the employer will generally have to pay the worker for the training time. In a new case, however, an employer took a different approach to worker training. The company […]