Paris Accounting Corp

Practice limited to business consulting and tax resolution

Phone: 718-281-0200
Email: info@parisac.com
PO Box 604993, Bayside, NY 11360
Profitability Consultant and CPA

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Employees and Overtime

A recent NYS law allows for employees to sue their employers for lost wages and unpaid overtime.

In fact, not only can the employee sue, but if the employer should pay as little as $1 to the employee in settlement, the employer is responsible for the employee’s lawyer fees.

I would think most employers would be outraged by what I just wrote.  And they should be.  Yet this does not change the law, challenge the law or stop what has happened due to this law.

French RestaurantI have several restaurant clients and each restaurant has been hit with a law suit at least 1 time.  I want to emphasize this so that every employer will protect themselves from this law and frivolous suits filed by former employee’s and their lawyers.

The law is designed to protect employees.  Employees generally do not have the funds to hire lawyers to sue employers.  This law, creates a new business for attorneys.  Attorneys are now approaching past restaurant employees willing to argue on their behalf for lost overtime and regular wages.

You see, if you are not management with the authority to hire and fire staff, you are required to be paid by the hour.  Which means if you work more than 40 hours in a week, or more than 10 hours in a day, you are entitled to overtime rates [which starts at 150% of regular wages].

An employer’s only recourse against a suit about lost wages or lost overtime wages are TIME CARDS or time records [as many time clocks are now digital].  The number of cases are mounting and the IRS has admitted that 50% of all employer/employee cases come from restaurants, and so the IRS targets restaurants as do suing lawyers.  But this law of pay and overtime pay affects ALL BUSINESSES.

Just this week we have a client who is considering closing his business and we have come to find out he never used a time clock.  So even after the business is closed and gone, for up to six years, his secretary could sue for overtime and he would have no records to defend the fact that overtime never happened.  Such is the case with a martial arts gym that raised someone’s salary.

I happen to mention we inserted the new pay rate and an overtime rate.  The owner was thinking, I never have overtime for my employees.  Great!  How can you prove it?  Do you have a time clock and retain the time clock records for at least 6 years?

Harlan S. Kahn CPA
Paris Accounting Corp
www.parisac.com

 

Additional Resources: Do you own your business or does it own you? Don’t leave without downloading our free whitepaper here. Revive the dream.

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CoSchedule makes social media management easy

I have been using CoSchedule for a few weeks now and I am really pleased to see how easy it is to manage my social media posts from my blog.  I have used other social media tools in the past – but this is the best app I have come across.  Great work team CoSchedule.

About CoSchedule

CoSchedule is an all-in-one marketing calendar that brings your content and social media in the same place. It’s your unified marketing calendar of record!

cos-logo-no-tagThe WordPress plugin is amazing. You can save a ton of time and grow your traffic by scheduling social media promotions right from WordPress while you blog! CoSchedule is the marketing calendar that WordPress has been missing.

The best thing about CoSchedule is that as you can manage all of your content using drag-and-drop simplicity.  Plus the Chrome plugin is a handy tool too.

CoSchedule integrates with WordPress, Evernote, Google Docs, Google Analytics and major social media tools like Twitter, Facebook, LinkedIn, Buffer, and even Google+ Pages.

 

CoSchedule-Top-PostsKEY FEATURES

Here is a brief video to learn even more.

https://youtu.be/uK3un3Wt_Qo

Get started on a free trial here:
Get CoSchedule here

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Deadline nears for conversion to chip-based payment cards.

Businesses that accept credit or debit cards need to be aware of changes coming Oct. 1, when merchants that are not yet using readers for chip-based cards will be on the hook for any fraudulent transactions. #business

Here is a great article for tips on Adopting EMV Chip Technology to Protect the Security of Your Business.

Excerpt:
payment cardsIf your business accepts credit and debit cards at the point of sale, change is coming.How your customers pay has also been changing, with new types of cards and payment forms.You need to be ready with new technology to accept those payments — and protect your business in the process.

How Payment Forms Are Changing

Read the rest of the article here: http://smallbiztrends.com/2015/08/emv-tips-credit-card-chip-technology.html

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When is a worker an employee?

Every week I get a call from a client who has an outside contractor.  What makes someone an outside contractor versus an employee? This is a very big sticking point with the IRS and NYS departments of labor.

Employee-WorkerGeneral guidelines are easy; you have a corporation of your own and you have your own workers compensation insurance for your corporation, the likelihood all governments fed and state will consider you an outside contractor.  So having worker’s compensation generally separates you into that independent/outside contractor group.

If you show to work at a desk provided by the boss and the boss determines the quality of your work chances are you are an employee.  But what about the sole proprietor with no insurance?

Case study: Recently a client had an audit in their car repair business [a sole proprietor] because a government employee from the Dept. of Labor brought his car in to be fixed and noticed what looked like an employee.  It was a relative of the owner who comes by part-time when needed to pick up extra work.  That’s an employee.  And the shop didn’t have worker’s compensation insurance because the relative often wasn’t even compensated many times.  Law requires such a place to have worker’s compensation insurance.

Another example, many yoga teachers have their own worker’s comp insurance [about $250 per year for most individual premiums] as should all independent workers.

Each case is determined by its own merits, and, NYS is much tougher than the IRS.
Worker’s compensation insurance protects employers and employees.  If an employee gets hurt on the job, worker’s compensation makes sure that the employee gets medical treatment with no deductible; and in return, the employee cannot sue the employer in most cases.

Worker’s compensation insurance is mandated by law, and it protects both the worker and employee.

A final question, “What happens when an outside contractor is hurt on a job?” (and here is potential trouble).  Sole proprietors or businesses with 1-2 owner/operators are not required by law to have insurance.  And so the detriment in an accident falls on the customer they are working for.  Is that fair? Perhaps not, but it is the law.

Final note: It is almost always a good practice to get worker’s compensation insurance, even if you think you don’t need it.

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NYS Notices about unemployment expense surcharges and assessments

Today’s blog is about NYS and the notices employers are currently getting regarding unemployment expense surcharges and assessments. Our unemployment system pays unemployed workers amounts that exceed the federal amounts paid.

HeadacheThere are in effect, NYS and federal unemployment monies transferred for one when collecting a check from NYS. NYS had to borrow money from the fed to afford the unemployment roles back in 2008.

Some time ago, NYS along with several other states, never paid the Fed back for money borrowed.  From that year forward, all NYS businesses file the long form 940 instead of a 940EZ.  Form 940EZ automatically gives you credit at 5.4% for unemployment taxes a business pays to NYS.

All states that don’t pay back the fed timely for borrowing money no longer get an automatic 5.4% credit.  So businesses pay more unemployment taxes to the fed for their state not completing their financial obligations!

Today we find out NYS is short money again towards their own unemployment needs.  So they are billing each business shy of $10 per employee to make up their short fall.

I hope you can all appreciate the NYS politicians we are electing. They borrow and don’t pay back monies promised, and they do not live up to the budgets they create:  outcome – businesses pay for their shortfalls and shortsightedness.

Contact our office if we can be of assistance.

#Frustrated   #WhyWeHatePoliticians

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