PEO Brokers of America » Payroll

Bracing for Obamacare, Some Businesses Try PEOs

admin — Wed, 18 Mar 2015 17:37:25 +0000

Some entrepreneurs are turning to professional employer organizations to navigate health reform’s complexities.

ESCO Communications, an Indianapolis-based audio/visual equipment installer, has provided health insurance for its 100 employees for more than 40 years, but when CEO Chip Roth was faced with 40 percent price hike on the company’s plan last year, he realized he needed to make a change. The cost increase–coupled with expected complexities of the Affordable Care Act, often referred to as Obamacare–led Roth to WorkSmart Systems, a local professional employer organization that pools health benefits for the employees of 200 small companies.

“Health insurance was the real driver,” Roth says. “By joining a larger pool and spreading the risk around, we were able to keep our rates the same as they were.”

With insurance premiums on the rise and health reform kicking into high gear, many small companies are looking for strength in numbers. Some are joining PEOs so they can provide a menu of affordable health plans to their employees, and outsource the complex administrative tasks associated with them. Matt Thomas, founder and president of WorkSmart, says his company is on track to double its sales in the three years ending in December 2015. “A lot of that has to do with the Affordable Care Act,” he says. “Even larger companies that wouldn’t normally look at PEOs are looking now, so they can avoid some of the ramifications of [the law].”

PEOs, available for the past 30 years, provide health benefits and handle human resources tasks, including payroll, workers’ compensation insurance and other benefits. And because a PEO does all of this for a group of companies, rather than just one, it can typically achieve economies of scale that individual companies can’t. The most recent data indicates that the sector is growing: PEO industry revenue reached $92 billion in 2012, a 13.6% increase over 2010, the year the health legislation was signed into law, according to the National Association of Professional Employer Organizations in Alexandria, Va.

PEOs generally charge a flat monthly fee per employee or paycheck, or they take a percentage of each client’s total payroll. If a PEO does its job well, it should generate enough savings for their clients to offset those fees, says Jay Starkman, founder and CEO of Engage PEO in St. Petersburg, Fla. “Insurance companies reward the aggregation of [employees], so oftentimes PEOs are able to deliver a 5 percent savings to their clients,” on health care, he says.

PEOs also say they save small companies the hassle and cost of hiring their own in-house HR staff, who could cost more than $80,000 a year in salary and benefits a piece. “A PEO does all the stuff that’s not essential to your core business,” Starkman says.

There can be drawbacks to joining PEOs, however. Because a PEO acts as a co-employer, you may feel as if you’re losing some degree of control over your employees. And how competitive a rate your PEO gets for health insurance will depend on the overall demographics and health status of all the employees it is insuring–factors that are out of your control and that will likely change over time.

A big reason PEOs are seeing a bump in interest these days is that many small companies simply need help wrapping their brains around the new health law, says Pat Cleary, CEO of NAPEO. All companies with 50 or more full-time employees will have to offer health insurance, but the intricacies of complying with the law can be hard to navigate. “The perils and pitfalls that are in there for any small business are significant,” Cleary says. “The biggest advantage, in my view, of going to a PEO is to be able to say, ‘Figure this out for me.'”

Frank Romero, chief revenue operations officer of Evanston, Ill.-based Grocer Exchange, a network of independent supermarkets, says he’s more comfortable with health reform since he signed on with Engage PEO in January of this year. “The owners of our supermarkets, which are typically manned at a rate of 30 to 40 people per store, need this, because they can’t afford to do this administration themselves,” Romero says. “And the PEO brings to the table benefits savings that they could never get themselves.”

By: Entrepreneur Magazine

888.370.5406

info@peoboa.com

request a quote

The post Bracing for Obamacare, Some Businesses Try PEOs appeared first on PEO Brokers of America.

Top 5 Startup Payroll and HR Mistakes

admin — Tue, 17 Mar 2015 15:17:31 +0000

Top 5 Startup Payroll and HR Mistakes

Startups are natural rule breakers. You’ve got to ruffle a few feathers and disrupt the status quo if you want to build the next Facebook. But there’s one area where startups definitely don’t want to break the rules: payroll and HR.

Startups that don’t comply with payroll and HR laws can face serious legal and financial consequences. Some penalties are even severe enough to drive them out of business. With that in mind, we’ve put together this list of the Top 5 Payroll and HR Mistakes that every startup should be absolutely sure to avoid.

1. Commingling personal and business finances
In the early days of a startup, founders may be tempted to put off separating personal and business finances for as long as possible, reasoning that they can save time and money by paying employees and contractors directly out of their own pockets.

This is short-term thinking than can have dire consequences down the road. Eventually that startup will have to disentangle all its expenses and pay back taxes.

If the startup is ever sued or audited, a blurry distinction of personal and business expenses can render a founder’s personal assets vulnerable to court seizure. A startup could even be stripped of its corporate status. Most founders think, “That will never happen to me.” But it often does.

2. Misclassifying employees as independent contractors
Treating an employee as an independent contractor is one of the most costly mistakes a startup can make. Employers do it because they don’t have to pay taxes, insurance or overtime to independent contractors. They also don’t have to give contractors benefits.

Misclassification is especially common in startups, where many practice “try before you buy” hiring. Yet if the responsibilities of the job don’t materially change when an contractor “converts” into an employee, the IRS considers that worker as having been an employee all along.

There are the state penalties, too. In California, the penalty for deliberate misclassification ranges from $5,000 to $15,000 for each violation.

What makes an employee? It varies state-by-state, but the basic legal definition relates to how much “control” an employer has over when, where and how an employee works, and for how long. If the length of her engagement is indefinite, then she’s an employee.

3. Managing payroll AND compliance
Payroll is so hard to do, and business screw it up so often, that the IRS penalizes about 1 in 3 business for payroll errors. The complexity of managing quarterly tax withholdings at the local, state and federal level…. it easily adds up to a full-time job, even for a business with just a couple of employees. That’s why most businesses use a payroll service.

But payroll services only get you so far. Startups still need compliance, like Worker’s Comp, EPLI and Unemployment Insurance. These are required in most states, including New York and California. Then there’s new hire reporting, I-9 documentation and healthcare. Compliance overhead in even the smallest of startups quickly escalates.

That’s why many savvy startups use a Professional Employer Organization (PEO) to manage payroll and compliance. A PEO manages a startup’s payroll, including myriad taxes, and ensures compliance with all required insurance and reporting. A PEO can even offer great deals on healthcare plans and other benefits.

4. Overpaying for healthcare and benefits
Startup competition is fierce these days. If you want to attract top tier talent, especially developers, you’ve got to offer excellent benefits, particularly healthcare.

But even “good enough for now” healthcare plans are expensive, particularly for smaller companies, who pay more for less coverage. It’s the law of leverage at work: the larger the company’s employee base, the sweeter the deal.

What’s a startup to do? Consider a Professional Employer Organization (PEO).

A PEO is a company that uses a legal arrangement known as co-employment to bargain for and administer healthcare and benefits packages, thus securing better terms than a startup could on its own.

PEOs offer savings on medical, dental and vision plans, as well as 401(k), typically available only to much larger companies. PEOs even handle the burdensome paperwork of regulatory filings and plan administration.

5. Frustrating employees with endless paperwork and confusing software
Nobody likes paperwork, especially not fast-moving startups. Yet many businesses continue to use outmoded HR processes and legacy software. Stop the madness!

BY: Justworks

Fortunately PEO Brokers of America makes it easy for a new business to get started with a PEO. Starting a business is hard enough without the frustrations of knowing the laws regarding payroll and HR.

888.370.5406

info@peoboa.com

request a quote

The post Top 5 Startup Payroll and HR Mistakes appeared first on PEO Brokers of America.

How Small Businesses Achieve A Double-Digit Growth With a PEO

admin — Mon, 02 Mar 2015 19:57:00 +0000

“Conformity is the jailer of freedom and the enemy of growth.” ― John F. Kennedy

Kennedy was writing about the need to break apart from the competition in order to grow. In order to break apart, you need to first focus on your core competencies. According to a NAPEO study, companies that hire Professional Employer Organizations have been shown to grow 9% faster than those who manage their HR, benefits and payroll in-house. More from this study:

“If PEOs are successful in enabling small businesses to focus more directly on what it takes to succeed in a competitive marketplace, it follows that PEO clients should grow faster than other comparable organizations. And, indeed, this is what the evidence shows.”

We love this study for obvious reasons. It proves what our clients have said to us for years — that working with a PEO makes facilitating the growth of a business much easier. As a business or a nonprofit, you’ve all experienced the headaches associated with HR — the great many minutia involved with human resource management.

(Download the NAPEO study here)

So… What is a PEO?

Many of you probably aren’t too familiar with the term PEO. Very simply, an accredited PEO or Professional Employer Organization acts as your Human Resources and payroll department, performing the non-revenue generating functions of HR for you, so you can focus on growing your business! A PEO company is a business that provides human resources outsourcing services to clients through the use of a co-employment relationship. Here’s how theNational Association of Professional Employer Organizations defines a PEO:

A PEO provides integrated services to effectively manage critical human resource responsibilities and employer risks for clients. A PEO delivers these services by establishing and maintaining an employer relationship with the employees at the client’s worksite and by contractually assuming certain employer rights, responsibilities, and risk.

What is co-employment?

Co-employment is a relationship where the PEO company conducts all the administrative employer tasks & the client deals with tasks that a client does best. Because of the co-employment relationship, a PEO company can help small & medium-sized businesses accomplish valuable human resources tasks that they may not be able to accomplish on their own. The administrative side of having employees can be daunting, and partnering with a comprehensive PEO company can help your business succeed. This graphic shows 3 ways your business benefits from using a PEO:

PEOs provide the expertise and experience that small to medium-sized businesses need to effectively manage human resource functions and risks that are inherent in operating any business. PEOs deliver integrated services through establishing and maintaining a relationship, called “shared employment,” with employees at your worksite and by contractually assuming certain administrative and legal functions, employer rights, responsibilities and risk.This means helping your business succeed by providing:

Access to and administration of comprehensive employee benefits packages, allowing your company to be competitive as an employer. Benefits are a key piece to your employees’ compensation package.
High-end payroll services including online access to reports. Partnering with a PEO will allow you to virtually eliminate payroll errors and mitigate tax-related risk, leaving you time to do what matters most: grow your business.
Unique to PEO’s: Shift of much of the legal and fiduciary liability associated with employment away from your organization onto your PEO. Certified risk management professionals will aid your organization in understanding and overseeing implementation of federal workplace regulations, minimizing the risk you face as an employer through premium HR outsourcing.
Unique to PEO’s: Pool together all of the employees of the PEO’s clients for superior buying power and spread risk across a large number of employees.
Workers’ compensation and comprehensive worksite risk management. Traditionally you pay for workers’ compensation insurance at the beginning of the plan year, go through an audit at the end of the year, and either pay a “true-up” or get a refund at the end of the year. It’s impossible to plan ahead… you lay out all that cash at the beginning of the year, and cross your fingers.
Professionally trained employment teams who know the latest laws and requirements and how they can affect your bottom line. One way PEOs do that is by becoming your human resources outsourcing department. For those of you that already have an HR expert, PEOs work hand-in-hand with him/her to handle the hundreds of tasks so they can focus on strategic HR for your organization.
Improved employment practices, compliance and risk management to reduce your liabilities. With PEOs, certified risk management professionals will aid your organization in understanding and overseeing implementation of federal workplace regulations, minimizing the risk you face as an employer through premium HR outsourcing.
Employment Services. Some PEOs are able to offer Employment Services to track time management and the recruitment and retention of top talent. These HR services allow companies to acquire top talent, manage employee time systems and align workforce goals with high-level company objectives.
Accreditation by the Employer Services Assurance Corporation (ESAC), which provides a $1 million surety bond to the PEO, plus a $10 million surety bond to provide assurance of the timely and appropriate performance of key employer services. (Read more about Merit’s ESAC’s accreditation here.) Be sure that your PEO is accredited!

For more benefits of PEOs, feel free to go here to download the NAPEO study showing how PEOs fuel small business growth.

The post How Small Businesses Achieve A Double-Digit Growth With a PEO appeared first on PEO Brokers of America.

The Most Common Employee Lawsuits — and How to Avoid Them

admin — Fri, 13 Feb 2015 15:56:49 +0000

The Most Common Employee Lawsuits — and How to

Avoid Them

IMAGE: GARY WATERS/GETTY CREATIVE

BY BURTON GOLDFIELDSep 24, 2014

This article is part of DBA, a new series on Mashable about running a business that features insights from leaders in entrepreneurship, venture capital and management.

Most employers think they follow laws to a tee. However, many business owners and their employees are unknowingly breaking federal employment laws, which can lead to time-consuming and costly legal lawsuits. Below, we address the most common forms of employee lawsuits and spell out tips to help you maintain a safe working environment and avoid becoming embroiled in the court system.

Discrimination

Discrimination claims are the most common form of employee lawsuit. The U.S. Equal Employment Opportunity Commission (EEOC), a federal organization tasked with enforcing these laws, received

93,727 of these charges in 2013 alone

93,727 of these charges in 2013 alone. The EEOC tracks the many forms of discrimination and all alleged cases, particularly those concerning protected categories like race, sex, nationality, religion, sexual preference, age or disability.

Discriminatory Discharge

Discriminatory discharge occurs when an employee is either fired or laid off because he or she falls into a legally protected category, outlined above.

Retaliation

Retaliation often occurs in the context of a discharge. An example would be firing an employee due to his or her engagement in a legally protected activity, such as:

Filing a claim of discrimination
Participating in an investigation of such a claim
Refusing to commit an illegal act, such as refusing to lie during an investigation

Retaliation can also occur without a discharge. Indeed, almost any adverse action to an employee involved in a claim is illegal.

Harassment

Harassment includes offensive conduct relating to any of the above mentioned categories (i.e. gender). It also includes offensive jokes, objects or pictures, name-calling, physical assaults, threats and anything else that might interfere with one’s performance at work. This type of conduct can create an intimidating, hostile, or abusive environment.

The harasser can be anyone that is associated with the workplace, including full-time employees or contractors. Anyone can lodge a harassment complaint, regardless of whether they witnessed it or were the recipient of it.

How to Avoid Lawsuits

To avoid legal trouble, familiarize yourself with federally protected categories, rights and activities recognized by federal labor and employment law, including:

Title VII of the Civil Rights Act of 1964: Prohibits discrimination due to race, color, religion, sex and national original. It also includes the Pregnancy Discrimination Act (PDA), which forbids discrimination based on pregnancy, childbirth or related medical conditions.
Equal Pay Act (EPA): Prohibits gender-based pay discrimination between men and women performing similar roles. This law includes employers who are covered by the federal Fair Labor Standards Act (FLSA).
Family and Medical Leave Act (FMLA): Prohibits discrimination against pregnant women and parents, as well as employees with serious health conditions.
Age Discrimination in Employment Act (ADEA): Prohibits discrimination against employees age 40 and older.
Americans with Disabilities Act (ADA) and ADA Amendments Act (ADAAA): Prohibits discrimination against qualified employees or job applicants due to a disability, association with someone disabled or because the employer sees an employee as disabled, even if he or she actually is not.
Genetic Information Non-Discrimination Act (GINA): Prohibits employers, employment agencies, and labor unions from discriminating employees based on genetic information.

Note that there are also many state laws regarding employment discrimination. Although some are similar to federal laws, they can often afford additional protections for employees.

Practice Better HR

What can you do right away to ensure that your organization doesn’t break these laws? Take proactive steps to eliminate unlawful bias in decisions and processes and eliminate harassment. Here are some specific tips:

Hiring: Eliminate considerations that have nothing to do with competence. Also, make sure your hiring documents are legal and that your interviewers are aware of what can and cannot be asked of a job candidate.
Work Environment: Make clear what is appropriate activity by enacting a company-wide program that will educate everyone on what is acceptable and unacceptable workplace behavior. Also, create an environment in which employees feel free to raise concerns regarding possible discriminatory behavior and are confident that those concerns will be addressed.
Harassment prevention: Take appropriate steps to prevent harassment. Establish an effective complaint or grievance process, provide anti-harassment training to managers and employees, and take immediate and appropriate action when an employee complains.
Dismissals: As with hiring, eliminate considerations that have nothing to do with competence. Also, make sure your communications and documentation are appropriate and clear. Assume that whatever you say can and will be used against you.
Education: Keep up on the latest changes in employment law.

How does your company work to prevent harassment or discrimination in the workplace? Tell us in the comments.

The post The Most Common Employee Lawsuits — and How to Avoid Them appeared first on PEO Brokers of America.

Payroll Processing: Proper Calculation of Employee Pay Helps Minimize Wage and Hour Compliance and Litigation Risks

admin — Fri, 13 Feb 2015 15:49:34 +0000

Payroll Processing: Proper Calculation of Employee

Pay Helps Minimize Wage and Hour Compliance and

Litigation Risks

By: ADP Blog

With wage and hour litigation on the rise, payroll accuracy should be a top priority for employers. Our review of court data shows that of all state and federal court employment law class actions filed in the United States, 90 percent are wage and hour class or collective actions. This increase in wage and hour litigation stems from Department of Labor initiatives that seek to inform employees of their rights under FLSA and the growing number of lawyers specializing in Fair Labor Standards Act (FLSA) cases. Why should employers be concerned? The potential damages in these cases are alarming: in 2010 the average settlement in the top 10 reported wage and hour class and collective actions was $34 million. Most wage and hour litigation claims involve: 1) unpaid work time, including payroll errors in calculating the value of bonuses and commissions for hourly employees who work overtime; and 2) misclassification of workers as exempt, leading to denial of overtime pay. This paper discusses current trends in unpaid work time litigation and makes recommendations for improving payroll accuracy that may help you, the employer, minimize your exposure to these claims.

Tweet this

Recent Trends in Collective Action for Unpaid Work Time Drive Payroll Imperatives

Unpaid work time litigation often results from auto-deductions for meal periods, rounding, remote work, and off-the-clock work — all of which present challenges for calculating accurate paychecks that comply with FLSA mandates. In each of these cases, all it takes is a few employees negatively impacted by an employer’s payroll policies to turn a personal gripe into a costly collective action. What can employers do to protect themselves? Implementation of automated payroll and timekeeping systems can help minimize internal employee complaints by automatically applying even the most complex wage and hour policies mandated by federal and state laws and/or union agreements. Adopting a policy that requires employees to certify the accuracy of their time records and paychecks can also help employers stay ahead of wage and hour litigation trends.

Failure to Properly Calculate Payroll “Regular Rate” Increases Risk of Employee Wage and Hour Complaints

Tweet this

Another trend involves errors in factoring the value of bonuses and commissions for hourly employees who work overtime. Overtime is calculated at a 50 percent premium rate from the regular rate of pay for hours worked over 40. The regular rate of pay includes not only the hourly wage paid to an employee, but in most cases, also includes other forms of nondiscretionary compensation such as bonuses, incentive pay, commissions, shift differentials, or retroactive pay increases. Nondiscretionary bonuses and commissions can be problematic from a payroll perspective because they generally must be apportioned back over the period in which they were earned. Given these complexities and the associated litigation risks, employers may want to consider adopting payroll practices, backed up by automated systems, that speed and ease bonus recalculations while minimizing the need for payroll personnel to calculate “regular rates” using error-prone manual methods.

Payroll Processes and Automation Help Employers Stay Ahead of Wage and Hour Litigation Trends

Employers can minimize wage and hour compliance and litigation risks associated with unpaid work time by adopting strict payroll policies and implementing payroll software that can automatically apply complex work and pay rules mandated by FLSA and union collective bargaining agreements. Specifically, the implementation of policies, training and auditing in conjunction with automated time and attendance and payroll systems can help minimize employee wage and hour complaints and address those that may still arise.

The post Payroll Processing: Proper Calculation of Employee Pay Helps Minimize Wage and Hour Compliance and Litigation Risks appeared first on PEO Brokers of America.

Staples Drivers Unpaid Wages Class Action Lawsuit Filed

admin — Fri, 13 Feb 2015 15:35:27 +0000

Staples Drivers Unpaid Wages Class Action Lawsuit

Filed

BY: Bigclassaction.com

Los Angeles, CA: Office supply retailer Staples Inc, is facing an employment class action lawsuit filed by a delivery driver in Texas who alleges the company fails to pay himself and his colleagues for time spent waiting while the delivery trucks are loaded.

Filed by plaintiff James McCutcheon, the lawsuit claims Staples requires its drivers to be at job sites at specific times but doesn’t pay them for the time they spend waiting for their trucks to be loaded, which is routinely between 10 minutes and an hour. McCutcheon claims that this is in violation of the Fair Labor Standards Act (FLSA).

“Staples recklessly failed to investigate whether its payment practices complied with the Fair Labor Standards Act,” the lawsuit states. “On information and belief, Delivery Drivers have complained about not being paid overtime or minimum wage for time spent waiting for trucks to be loaded at the beginning of their shifts.” The lawsuit states that Staples’ drivers, who are paid on an hourly basis, “have suffered lost wages” as a result of the company’s failure to pay its employees for this loading time, according to the lawsuit.

McCutcheon worked as a Staples delivery driver from June 2006 until January of this year. He seeks to represent a class of delivery drivers who have worked for Staples in the previous three years.

McCutcheon is represented by Jack Siegel of Siegel Law Group. The case is James McCutcheon v. Staples Inc., case number 3:15-cv-00365, in the U.S. District Court for the Northern District of Texas.

The post Staples Drivers Unpaid Wages Class Action Lawsuit Filed appeared first on PEO Brokers of America.

Fines for I-9 errors on the rise

admin — Wed, 04 Feb 2015 18:30:41 +0000

Fines for I-9 errors on the rise

BY SCOTT WOOLDRIDGE @BenefitsPro

Fines resulting from I-9 audits have exploded in recent years, and immigration law experts say employers should put a high priority on making sure their policies and paperwork are in compliance.

“We have seen a huge increase in fines against employers, and we don’t think that’s going to go away,” says Loan Huynh, a shareholder with Minneapolis-based Fredrikson & Byron.

The fines are levied for failures in compliance with Form I-9. First created as part of the Immigration Reform and Control Act of 1986, I-9 enforcement saw a sharp uptick in audits and fines after a revision to the form in 2013

ICE audited more than 1,000 businesses nationwide after that update. By comparison, ICE conducted only 250 audits in 2007. With the steady growth in audits and enforcement, businesses paid $13 million in fines by 2012.

Justin Storch, manager of agency liaison for the Alexandria-Virgini.-based Council for Global Immigration, also saw a jump in fines for I-9 mistakes.

“In general over the last several years, it has skyrocketed,” he says. “I’m guessing the numbers will be even higher in 2014 than it was in 2013.”

Storch says that among the issues emerging for employers is a crackdown on workers who might have been approved to work in the United States for a limited period of time, for example a conference or short-term assignment, who then continue to work after its ended.

“It really is important to do everything by the book, and don’t leave any holes open to let the government to come in,” Storch says.

The political stalemate over immigration reform only adds to the problem of ICE audits, according to a recent white paper from Talentwise. “With robust resources at its disposal (ICE is the largest enforcement agency within the Department of Homeland Security), and no clear legislative path to immigration reform in sight, experts predict the pace will continue,” the authors conclude.

Tips for employers

Huynh says there are several steps employers can take to protect themselves. She says having proper documentation — and backing that up with copies, is crucial.

“Under the law, if an employer has made paperwork errors or mistakes … if they have certain supporting documents, the law allows the immigration service to allow [employers] ten days to make corrections,” she says. “None of us are perfect, when we’re completing forms. You want to be perfect as possible, but you really need to make copies of supporting documents.”

The Society of Human Resource Management website has several tips for employers, including being compliant with deadlines. For example, a new hire must complete Section 1 of the I-9 form on or before the first day of employment, while Section 2 of the I-9 must be completed by the employer within three days of the start date. Other important steps include having your policies in writing and a one person in charge of the process.

“The buck needs to stop with someone,” Loan says. If no one is tasked with ownership of the I-9 paperwork, it’s too easy for things to slip through the cracks. And the consequences of such mistakes can be very high.

Huynh’s firm also recommends semi-annual audits, preferably by a third party. She notes that if there’s an error in a company’s I-9 system, whoever created the system might be the last to notice problems.

“If you have the individuals who are responsible for your I-9 forms do your audit, they will perhaps continue to make the same mistakes,” she says. “It’s always helpful to have [an outside party] help you conduct the I-9 audit.”

Storch also strongly recommends getting an outside source to review your I-9 compliance.

“There are experts out there,” he says. “Immigration attorneys are probably your best resource as far as getting good information. They can help you stay compliant.”

Although there is a cost for using attorneys to help with I-9 issues, Storch say it’s worth it.

“I’m very aware that immigration attorneys can be very expensive, but it can save you money in the long run,” he says.

Huynh points out another benefit: by using an immigration attorney, the audit can be kept confidential.

“Any findings made as a result of the I-9 audit, if it’s conducted by an attorney, it’s protected under attorney client privilege,” she notes.

The rules around I-9 forms can be very specific and sometimes confusing. For example, those filling out the forms must not use white correction fluid or black permanent marker. The person who fills out the form must be the person who signs it. Employers must retain any pages of the form which the employee and employer enter data. In short, that legal consultant might be a good investment.

The growth of E-Verify

Complicating the issue further is the growing use of E-Verify, a free online system that checks applicants’ I-9 information against the records of other agencies such as the Department of Homeland security and the Social Security Administration.

Many states now require the E-Verify for at least some types of employers. But in many cases, the use of E-Verify is a duplicative effort for businesses, and it requires even more information than the I-9 process.

However, Huynh says some employers like the E-Verify system because it provides another layer of security against employment fraud.

“Some employers feel comforted by the fact that they’ve done everything they can,” she says.

However, she noted it wasn’t a perfect system, “It’s not foolproof.”

Even with its flaws, Huynh expects the use of E-Verify to grow in coming years, “E-Verify is the future of employment verification eligibility, whether we like it or not.”

The post Fines for I-9 errors on the rise appeared first on PEO Brokers of America.

Find Out How One National Food Chain is Getting Itself Into Hot Water By Misclassifying Employees

admin — Tue, 06 Jan 2015 22:23:17 +0000

Suit filed in Jacksonville against Jimmy

John’s, alleging unfair labor practices

by:

Eric Snider: Reporter- Tampa Bay Business Journal

A federal class action lawsuit was filed Tuesday in Jacksonville against Jimmy John‘s, alleging that the sandwich chain illegally underpaid assistant store managers throughout the country.

According to the complaint, “Regardless of the number of hours worked, Jimmy John‘s fails to pay [assistant store managers] any overtime compensation.”

The company requires assistant store managers to perform food preparation and provide customer service as their primary duty, but classifies them as “executives” exempt from the overtime pay provisions, the lawsuit alleges.

“We’re not saying they didn’t perform any managerial duties,” said Justin Swartz of Outen & Golden of New York, part of a three-firm law team that has brought the complaint. “But their primary duty is making sandwiches and serving customers.”

A spokeswoman for Jimmy John‘s declined comment via email.

The legal team will seek to have the suit certified as a collective action to recover unpaid wages, service awards, interest and attorneys fees for eligible assistant store managers who worked at Jimmy John‘s since January 2012. Lawsuits under the Fair Labor Standards Act allow for up to double damages.

In FLSA suits, plaintiffs must opt in to a class, or collective, action. Swartz said the legal team will ask the judge to compel Jimmy John‘s to hand over names and addresses of people eligible to join the suit, then reach out to them and see if they care to join.

He estimated that the potential plaintiffs number in the thousands, and that cases such as this one generate an opt-in rate of 20 to 30 percent.

Three plaintiffs — Jay Rodriguez in Jacksonville, and one each in Chicago and Tuscaloosa, Alabama — brought suit in U.S. District Court for the Middle District of Florida, Jacksonville Division.

They are represented by Outten & Golden’s New York office; Shavitz Law Group of Boca Raton; and Klafter Olsen & Lesser of Rye Brook, N.Y.

Eric Snider is a reporter for the Tampa Bay Business Journal.

The post Find Out How One National Food Chain is Getting Itself Into Hot Water By Misclassifying Employees appeared first on PEO Brokers of America.