All posts by stu

401(k), Compensation, Financial Well-being, Human Resources, IRS, Retirement

How much can Employees’ Contribute to a 401(k) plan in 2020?

More than ever, companies are taking action to improve the financial well-being of employees and providing them with tools and information to better prepare them for retirement and financial literacy. A credit union relationship and information sessions about investing and retirement planning are great solutions. Offering a company-sponsored 401k plan gives employees a way to saving for retirement.  Did you know that fifty-one percent of small business companies with 10 or more employees have researched offering a 401(k) plan, according to the Millennium Trust Small Business Retirement Survey?   Due to the rising economy, Fidelity announced that retirement savings rates among employees is rising.  The average 401(k) contribution rate is 8.8% (excluding employer match) – which is the highest percentage ever.  In addition, employers are contributing an average of 4.7% to employees as match, bringing the total contribution to 13.5%.

In early November, the IRS announced that employees in 401k plans will be able to contribute up to $19,500 in 2020, a $500 increase from the 2019 limits.   The IRS announced this and other changes in Notice 2019-59 (PDF), posted today on IRS.gov. This guidance provides cost‑of‑living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2020.

The catch-up contribution limit for employees aged 50 and over who participate in these plans is increased from $6,000 to $6,500.  The limitation regarding SIMPLE retirement accounts for 2020 is increased to $13,500, up from $13,000 for 2019.  However, the annual contribution limit for IRAs will remain unchanged at $6,000.

Interested in setting up a 401(k) plan for your small business?  Check out the Department of Labor’s Information booklet for establishing a 401(k) plan.  Download it today.

Construction, Drug and Alcohol, Drug Free Workplace, Employee Handbook, Federal Contractors, Hiring, HR Compliance, Risk Management, Safety, Workers Compensation

(Save thousands $$) How to Implement a Florida certified Drug Free Workplace Program

Every day Florida employers choose to establish certified drug-free workplace policies, to save money and be protected from workplace accidents that are caused by employees working under the influence of drugs and alcohol.  The benefits of becoming a carrier certified drug free workplace include: (1) employees are aware of the importance of safety in the workplace; (2) intoxicated workers that get hurt at work may forfeit eligibility for workers’ compensation benefits; (3) employees terminated for a positive drug/alcohol test may be disqualified for reemployment benefits; and (4) your company is eligible for a five (5) percent credit (annually) to your workers’ compensation premium!

Ten (10) steps to become a certified Florida drug-free workplace

  1. Create a written drug-free workplace policy that follows the requirements of the Florida Statute.
  2. Distribute an introductory letter to all current employees to announce the new policy and to provide the mandated 60-day notice for any drug testing requirements to apply to existing employees: (fitness for duty, reasonable suspicion are required – random is optional.)
  3. Select a qualified drug testing facility and Medical Review Officer. The collection and testing must be done by a Florida approved testing facility.
  4. Assemble a drug-free workplace binder that will be available to applicants and employees. It contains required community treatment resources and substance abuse information.  Create a list of employee assistance programs in the local area, with addresses and telephone numbers.
  5. Obtain a signed acknowledgment of the new drug-free workplace policy from existing employees and future applicants.
  6. Post a workplace Drug-Free Workplace poster for employees and applicants, and begin to include “drug-free workplace” or “DFWP” in all future job ads and postings. Also, add “drug-free workplace employer” to the Company’s Employment Application.
  7. Apply for the Insurance Premium discount using the Application for Drug-Free Workplace Premium Credit Program form.
  8. Perform (and document) training for supervisors on how to recognize employees that may be under the influence of drugs or alcohol. Create a reasonable suspicion form that can be used if needed.
  9. Establish new hire procedures that include pre-employment drug testing, the signing of an acknowledgment of the drug-free workplace policy and consent to be tested. If an applicant tests positive for illegal drugs, prepare a letter to revoke a job offer or terminate employment based on the positive drug test.
  10. Keep all drug testing results and related documents confidential. We recommend keeping all drug test documentation in an employee’s medical file (separate from the normal personnel file).

Start today!  Get your company certified by its workers’ compensation carrier so you can start receiving your 5% premium credit and supporting safety.  We have a turn-key process and all the documents & forms you need to get certified.  It does not matter who your workers’ compensation carrier is, we will assist you to get certified.

Employee Handbook, Employee Misconduct, Employee Policies, Fractional HR, HR Costs, HR Resources, Human Resources, Manager, Performance Review, Personnel File, Unemployment

Dealing with Your Problem Employee

Nobody likes disciplining employees.  Well, … perhaps that’s not true.  But to be honest, I’m not sure I’d want to employ too many supervisors who LOVE engaging in disciplinary actions.  But, like it or not, it’s critical to the success of your company that progressive disciplinary procedures are understood, followed, and applied in a timely, fair, and consistent manner.   If you value your employees who are meeting expectations — showing up on time, not wasting the day on gossip, following through on procedures, etc. —  don’t give them a reason to believe that a solid work ethic and good habits are optional at your workplace.  Ignoring disciplinary problems might even be a disservice to the offenders themselves … many of whom have simply conformed to a perceived threshold of tolerated behavior.  It does them little good to tolerate them out of a job.  As for the true reprobates, it does you no good to prolong a well-documented departure.

ConsultStu can help, with customized, affordable HR on demand.  If you don’t have a written progressive discipline policy, we can write one for you.  If you like, we can give a quick training presentation to your supervisors on constructive discipline, conflict resolution, and following company policy.  When disciplinary situations arise, here are some benefits of our services:

  • Adds a degree of third-party objectivity and provides some oversight to ensure that first line supervisors and lower management levels are being fair, clear, consistent, non-abusive and non-discriminatory.   We will also make sure managers are not “negotiating” behavioral changes in ways that could be mistaken for contractual promises.
  • Things will get written down that weren’t previously documented, and this can include what has already transpired.  Many times our clients need to be reminded that it’s okay to write down statements retroactively, which can serve as a starting point of evidence: describe previous episodes of problem behavior, verbal feedback or coaching, employee meetings, etc.  Include dates and details whenever possible, and ask the employee to acknowledge or give an explanation of any disagreement.
  • Assumptions will be avoided.  Never presume the employee is aware of what he/she did wrong or that it is unacceptable behavior.  Even if you have addressed conduct in your Employee Handbook, and gotten a signed acknowledgment… it is ALWAYS best to write a brief individualized description of any incidents or counseling, to be acknowledged by both employee and supervisor.
  • Proper and methodical documentation made easier with our templates.   If you task a busy supervisor to figure out how to document a problem behavior, don’t be surprised if one employee file contains a couple of cryptic sentences, and another employee’s file contains a five-page outpouring of pent-up frustration that sounds like a vendetta.
  • Be better prepared for Florida re-employment claims.  Many terminations do result in benefits being charged to the employer, but we make every effort to utilize the most effective language in policies, interpretation,  disciplinary documentation and unemployment claim responses,  in order to reduce chargeable claims.

Using fractional HR to assist with disciplinary documents, meetings, and procedures will level the employee experience and improve the company’s effectiveness.

Fractional HR, General HR Questions, HR Compliance, Human Resources, Leaving a PEO, Personnel File, Posters, Record Keeping, Recruiting, Unemployment

Fractional HR Services are Flexible, Scalable, and Affordable

The vast majority of small family businesses and new businesses start up without a dedicated HR person, much less an HR department.  And that makes perfect sense … to a point.

As the owner of a fledgling business, handling HR matters is probably not only manageable, but educational and even gratifying.  Your business is your baby, and there isn’t any part of it you don’t want to be touched by your own two hands.  If it weren’t for confidentiality obligations, you’d put the W-4’s of your first employees in a frame and hang it on the wall as a milestone!

As you build the framework of services, products, relationships, and culture that will define your company, you begin to feel that you’ve got a handle on being an employer of human beings.  Or maybe more accurately, you know how to handle a few employees (including family and friends).  As the employee situations come up, you swat them aside and make one-on-one deals to keep things working.  Because you know that the biggest statistical threat to a young small business is funding and cash flow, you favor money-saving DIY solutions for payroll, recruiting, hiring, record-keeping, etc.  And it seems to work.

Your business grows in size, and there are compliance responsibilities that must be addressed.  Here is a small example.  Depending on your business type, your 10 employee company may be required to record employee injury cases on the OSHA 300 log and post it annually for employees to see.  Additionally, when you hit twenty employees, your industry code (NAICS) may mandate that your injury data be reported to OSHA on its new website.  Do you know your federal NAICS code?  There are dozens of HR and safety-related matters that can result in fines, penalties and lawsuits for your business.  Did you know that HR and safety can be handled without having to hire full-time employee or hiring a professional employer organization?

Typical Consultstu fractional HR services include:

  • Initial HR and safety assessment to identify your federal and state compliance requirements.
  • Feedback on new hire forms and written employment policies.
  • Update Employee Handbook.
  • Developing drug free workplace policies.
  • Personnel file review.
  • I9 audits.
  • Recommend (and implement) HR practices to minimize employment risk and employment costs.
  • Clients alerts when laws change and new rules are created.
  • Monitor unemployment claims.
  • Create and track OSHA 300 logs.
  • Set up streamlined HR processes.
  • Reviewing resumes and candidates.
  • Send new, updated state and federal employment posters, as needed.
  • Investigate employee complaints and grievances.
  • Employment training (harassment and EEO).
  • Discuss HR strategy and needed solutions to meet your business needs.
  • Safety manuals.
  • FMLA procedures and employee packets.
  • Exit interviews.

Fractional HR is being able to outsource your minimal HR needs to HR experts, without hiring any bodies.   Unlike an all-or-nothing PEO, we conform our services to YOU.  Consultstu can provide as much or as little HR guidance as you actually need, right now.  The best value is becoming a monthly retainer client, to receive a pre-established customized level of ongoing support.  This includes us always being available to you for HR questions, and client alerts to keep you informed of new regulatory forms and rules.  If an unexpected situation arises — for example, you receive a harassment complaint that needs to be properly investigated — we can easily ramp up “HR on Demand” to assist you, on an hourly or special project basis.  When you let us handle your HR headaches, you can relieve stress, free up time, connect with customers and get back to loving your business again.

Does my business need Fractional HR?

Business Expenses, Compensation, Department of Labor, Employee Policies, Employee Rights, Executive Order, Exempt Employee, Fair Labor Standards Act, HR Compliance, HR Resources, Human Resources, Overtime, Payroll, Salaried employees, Wage and Hour

New Overtime Rule: Exempt Threshold To Increase from $23,660 to $35,568 January 1, 2020

WHAT HAPPENED?

This Tuesday (September 24, 2019), the Department of Labor announced the following changes to the FLSA’s white-collar overtime exemptions, to become effective January 1, 2020:

  • The minimum salary threshold for exempt status will be $684 per week, annualized to $35,568 per year.
  • The highly compensated employee exemption’s total annual compensation requirement will be set at $107,432 per year (to include the new threshold as minimum weekly base salary).
  • No change has been made to the various other exemptions (for example, outside sales) that do not specifically include a salary requirement even if the employee happens to earn a salary.
  • There will be no “automatic” threshold updates, such as cost-of-living increases.

If you recall, a much higher increase had been set to become effective back in December 1, 2016, but was scrapped by federal and state court actions. While there is no way to guarantee that legal challenges might not delay or alter this latest ruling, we strongly advise our clients to plan for a January 1st implementation.  The new threshold formula and guidelines are less flawed are much less contentious, with the majority of the concerns driving the 2016 lawsuits resolved.  Overtime Rule 2.0 looks like a solid go.

WHAT SHOULD I DO NOW?

First, evaluate your compensation structure to see if anyone who is currently exempt will fail to qualify under the new threshold.  Take a moment to consider whether they might be subject to alternative FLSA exemptions.  If not, develop new FLSA compliant pay plans (either applying overtime pay or increasing exempt salaries).  Determine the timing, administrative tasks, and communications necessary to meet the January 1st deadline.  Then stay tuned to ConsultStu for the updates you need to keep your company on track.  NOTE: If you are a ConsultStu retainer client, Stu will be covering this topic at your next monthly HR support call, and we will assist you with any needed preparation!

HR Compliance, Human Resources, I9 Form, Immigration

We Conduct Publix Independent Third Party Immigration Reviews

Companies throughout Florida continue to contact Consultstu LLC to conduct a third-party immigration audit to meet the mandates of being a supplier of equipment or construction services to Publix Super Markets, Inc.  Publix expects all of its Suppliers to comply with all applicable federal, state and local laws and regulations, including the rules under the Immigration Reform and Control Act of 1986 (the law that created the mandate for obtaining an I-9 Form for all new hires).  Use our well-refined process to complete your needed Annual Immigration Law Certification and stay in compliance with your Publix Supplier Agreement.

What is involved in an independent third party immigration audit?  There are four requirements:  (1) a qualified third-party auditor must have documented experience and knowledge of immigration policy, including how to properly complete the I9 Form and the E-Verify checks; (2) review of a company’s immigration policies (including employment posters, handbook policies, and the process to view work authorization documents; (3) reviewing all, or a statistically significant number (for large companies), I9 forms and receiving feedback about mistakes and errors; and (4) check retention practices associated with I9 forms for former employees (does it meet federal requirements).

How long does it take? Once we have a signed engagement, our independent third-party audit can be completed in five to seven business days. When we start, we provide you with a specific list of documents to have available for our review.  Once complete, you receive our signed Immigration Law Certification form.

Are there penalties for incomplete or missing I9 Forms?  Obtaining an I9 Form is required by federal law.  Another benefit of a third party immigration audit is to identify any missing or incomplete I9 forms, or improper company policies. Errors can be corrected and that can potentially save your company thousands of dollars. Immigration and Customs Enforcement (ICE) monetary penalties for “knowingly hire and continuing to employ” violations range from $375 to $20,130 per violation. Failure to have a properly completed I9 form ranges from $110 to $2,292 per violation. If your company is selected for an ICE I9 form review, you will receive a Notice of Inspection letter and have three (3) days to present your I9 Forms to the designated ICE Auditor.

Call us today to discuss our third party immigration review and audit services.

Company Culture, HR Resources, Job Description, Performance Improvement Plan, SMART goals

How to Write a Performance Improvement Plan (PIP)

Hiring and training new employees (if you can find them) is expensive and time-consuming. Due to this dilemma, we are often contacted by Florida small business owners to discuss ways to positively address employee performance problems, in hopes of saving a productive employee.  So, before firing an employee, what can be done to save the company’s investment in their job skills? Good employees sometimes lose focus or struggle to deliver sustained performance results. In those cases, an employer will need to engage in an actionable conversation that can reverse a performance slide and reset job expectations – before termination. We regularly recommend that small business clients use two fundamental HR tools to implement a performance culture (and to drive business results): (1) regular performance dialogues (monthly, quarterly or annually) and (2) performance improvement plans. A performance improvement plan (PIP) is best used in conjunction with regular performance dialogues, but it can also be used as a stand-alone action to fix deficiencies in employee performance.

A PIP is appropriate when the employer is committed to helping an employee correct their performance problems and is willing to give sufficient time to see the improvement. If an employer has already decided that the employee will be terminated for poor performance, or the problems are related to workplace misconduct, then a PIP is not the best approach. The manager also needs to be committed to giving a fair chance to the employee and be accessible to give needed feedback and encouragement. If the manager only wants to create termination documentation, use corrective action and not a PIP. The use of PIPs also creates a company culture of employee focus, fairness, and transparency. PIPs work best when there are objective measures of performance, so the agreement can contain specific numbers, ratings or results. A PIP can also be used to address problems with work behaviors and critical competencies. For instance, if problem-solving, initiative or interpersonal skills are not good enough, the PIP can address these subjects.

A PIP will be put in writing, shared with the employee and signed by everyone. It is a formal structured approach to bridging performance gaps. When possible, a PIP should make reference to an existing written position description that identifies duties, competencies, and deliverables. Here are some other tips for putting together your written PIP together (either memo or letter format):

  • Include the reason for the PIP – be specific about deficiencies – give example(s)
  • State that current performance coaching has been unsuccessful
  • Have a positive and confident focus – be appreciative of contributions
  • Add PIP plan details – organize around general areas and then give specific standards that will be used to measure and determine success.  For example: improve communication with department manager – provide daily feedback to manager about “x type” situations.
  • Use deadlines and time frames such as 30 or 60 days.
  • Restate that improvement must be sustained.
  • Employee and manager sign the agreement

After meeting with the employee to explain the PIP, and getting it signed, the manager will calendar the follow-up events and then monitor the plan and performance progress. If there is training or skill-building elements in the plan, the session needs to be assigned and completed.  With hard work and discipline by both parties, hopefully, you can save the employee.  If your company wants a sample PIP template, give us a call.

Insurance, Risk Management, Safety, Workers Compensation

Florida Work Comp Rates May Decrease 5.4% in 2020

According to an August 29,2019 press release by the Florida Office of Insurance Regulation, the National Council on Compensation Insurance (NCCI), the company who files on behalf of Florida’s workers’ compensation insurance companies, submitted a rate filing for a proposed overall average statewide workers’ compensation premium decrease of 5.4% effective date of January 1, 2020.  This would be the third straight year of premium decreases.  The last two approved experience filings in Florida have resulted in significant rate decreases; -9.5% effective January 1, 2018 and -13.8% effective January 1, 2019.

Click here to read the Filing Summary and reasons supporting the requested decrease in standard class code rates.

The Florida OIR will review the filing and the proposed changes are not excessive, inadequate or unfairly discriminatory and evaluate its potential effects on the insurance marketplace and employers, who are required by law to carry this insurance on their employees.

Even with work comp rates trending down, it is still an excellent time to review your risk management practices, injury management methods, HR policies and insurance coverage.  Premium discounts are available to Florida employers that implement a drug-free workplace and a written safety plan.  Human resource policies and practices can greatly assist your business to lower its workers’ compensation costs with structured hiring, background screening, safety training/orientation, and claims management techniques. Check with us if you need help identifying and implementing methods to help control your workers’ compensation costs.

HR Compliance, Human Resources, I9 Form, Immigration, Investigations, New Hire, Onboarding, Record Keeping, USCIS

What Happens if my Employee is Found Not Authorized to Work in the US?

The early August ICE raids targeting Mississippi workplaces have resulted in at least 40 arrest warrants, and enforcement raids are predicted to continue.  What if ICE Workplace Enforcement shows up at your business, and it is discovered that your company is employing unauthorized workers?  The outcome will depend heavily on the status of your I-9 documentation.  Here are 5 scenarios…

Scenario #1)  Form I-9 was properly completed at the time of hire, and has been retained as required.   Relax.  There is no verification violation.  Unless the government is able to prove that you had knowledge of the unauthorized status of the employee, and were aware that the I-9 verification documents were fraudulent (not genuine), then you have performed your employer duties to the best of your ability.  An employer can’t be expected to possess the expertise to accurately discern illegitimate or fraudulent documents if they appear genuine.

Scenario #2)  The Form I-9 you have on file contains properly corrected errors or omissions.  As long as no improper modifications were made to the documents, the outcome should be the same as Scenario #1.  You may have employees make corrections to Part 1 by drawing a line through incorrect information, entering correct information, and then initialing and dating each correction.  The employer may correct information in Parts 2 and 3 in the same manner.  Never use heavy Sharpie ink, correction fluid, or anything that would obscure any of the original content on I-9 documentation!  As a best practice, USCIS recommends that you attach a signed and dated note to corrected I-9s explaining what happened.

Scenario #3)  You have an I-9 on file, but it was not completed within compliance deadlines.  Not the best situation, but better late than never.  While failure to comply with Form I-9 employment verification requirements is a civil violation that can subject you to fines and penalties, it is certainly worthwhile to follow through on collecting employment eligibility documentation in order to avoid any appearance of “engaging in a pattern or practice of hiring unauthorized aliens,” which is a criminal offense.  To achieve full USCIS compliance, make sure all I-9’s are completed by the employee on their first day of work, and by the company representative on or before the third day of work.

Scenario #4)  You have two sets of I-9 documentation for the same employee whose identity appeared to have changed in every way: name, SSN, date and place of birth, etc.  Interestingly enough, if the I-9 paperwork is properly completed, this situation likely does not present an employer liability.  When an employee who has been working under a false identity obtains work authorization and wants to regularize their employment records in their true identity, it is acceptable to complete a new I-9.  Write the original hire date in Section 2 and attach the new I-9 to the previously completed I-9 form with a written explanation.  Further instructions are in the M-274 Handbook for Employers.

Scenario #5)  Your I-9 documentation is missing, incomplete, or error-filled.  Your expensive attorney is probably picking out colors for a new Porsche, and hopefully will be able to convince authorities that your actions are a result of incompetence or non-criminal negligence.  Before this scenario occurs, we recommend conducting an internal I-9 Audit.  For assistance with the planning and completion of your I-9 audit, contact us at ConsultStu.  We will conduct a private internal I-9 audit that will itemize issues and corrective actions needed.

Companies seeking to receive public recognition for its best employment practices, protect its brand and be exempt from I-9 Form inspections for four (4) years, may seek to partner with ICE and enroll in the IMAGE program. Click here for more information about IMAGE and a list of partners and company members.  For more information about the Social Security Number Verification Service (SSNV), which is a free internet verification system, managed by the Social Security Administration, that employers can use to verify that your employee names and social security numbers match social security’s records, click here.

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