What to expect from your BCN Services Accounting Department

One of the most important aspects of running a business is making sure that your taxes are filed correctly and that they are paid on time. BCN’s dedicated accounting team works hard to ensure that you no longer need to worry about this aspect and can focus on other areas of your business.

Below is a list of the tax-related matters that BCN will handle on your behalf, whether you are a PEO or HRO client:

  • IRS Form 941 employer quarterly tax filings and semi-weekly deposits.
  • Federal Unemployment administration, including annual Form940 annual unemployment tax filing and quarterly deposits.
  • Forms W-2 and W-3 preparation and distribution.
  • Withholding tax filings and deposits. We handle state, city, county and school district withholding tax filings and payments.
  • State(s) Unemployment Insurance SUI quarterly tax filings and payments.
  • State(s) Unemployment Insurance account, rate update verifications and rate negotiations as needed. We are also available to assist with any client-level unemployment registrations you may need.
  • Any employment-related IRS compliance/correspondence.

If you have any questions regarding how the BCN accounting team can help alleviate the stress of employment taxes, or have other questions about these topics, please give us a call at 1-800-891-9911.

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Amy Miller, Staff Accountant

Michigan Repeals Prevailing Wage Act

On June 6, 2018, the Michigan Legislature repealed the state’s Prevailing Wage Act through the Michigan Repeal Prevailing Wages and Fringe Benefits on State Projects Initiative (the “Initiative”). Michigan’s Prevailing Wage Act required project owners to pay workers union-scale wages and benefits for state-funded construction projects. The repeal took effect on June 6, but it does not affect preexisting contracts.

The Initiative was a result of resident petitions (the petition received over 300,000 signatures), and rather than place the Initiative on the November ballot, the Legislature repealed the Act. While Governor Snyder publicly opposed repealing prevailing wages, the repeal became law without his signature or his ability to veto it.

Supporters of the Initiative claim that paying prevailing wages for state projects overcharges taxpayers and limits the number of projects that can be funded or supported. Supporters argue that the Initiative will promote the free market and fair competition. Opponents of the Initiative argue that prevailing wages provide constructions workers with fair and standardized wages and benefits so that workers can comfortably provide for their families and that taking away prevailing wages will drive qualified workers away from the state. Opponents also argue that the repeal will ultimately lead to lower quality work because unions will no longer be able to fund adequate training and apprenticeships.

The Prevailing Wage Act repeal did not affect the federal Davis-Bacon Act, which requires payment of prevailing wages on federally funded projects. It also does not affect municipal and township laws that might require payment of prevailing wages. Many projects receive both state and federal funding, and such projects (such as highway construction) will likely still require payment of prevailing wages.

Michigan is now one of 23 states without prevailing wage laws. Michigan is part of a trend of states repealing prevailing wage laws with six states repealing such laws since 2015.

This client alert is published by Dickinson Wright PLLC to inform our clients and friends of important developments in the field of labor and employment law. The content is informational only and does not constitute legal or professional advice. We encourage you to consult a Dickinson Wright attorney if you have specific questions or concerns relating to any of the topics covered in here.

 

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Copyright @ 2018 Christina K. McDonald, Dickinson Wright PLLC. (https://www.dickinson-wright.com/news-alerts/michigan-repeals-prevailing-wage-act). Republished with permission.

Be aware of I-9 compliance and follow the rules to avoid audits

Immigration and Customs Enforcement (ICE), an agency of the U.S. Department of Homeland Security, recently announced that it is planning a nationwide increase of Form I-9 audits this summer. Additionally, the agency will continue to pursue criminal cases against employers and the deportation of employees who are in the United States illegally.

For fiscal year 2018, the agency has dramatically increased worksite investigations and I-9 audits, resulting in 594 criminal and 610 administrative worksite-related arrests.

In an effort to keep employers up-to-date on this topic, following are some tips for I-9 compliance:

Make sure you are using the most updated version of the form

The I-9 form is updated from time-to-time. To be compliant, an employee and employer must complete the most up-to-date version or they risk fines for each incorrect form that has been completed and submitted. The most current version of the I-9 form shows OMB No. 1615-0047 and expiration date of 8/31/2019 in the upper right-hand corner.

Adhere to signing timelines

Section 1 of the I-9 form must be completed by the employee “at the time of hire.” This is defined as starting when the employee accepts the job offer through the end of the employee’s first day of active employment. This means if your new hire is completing the I-9 form the week after his or her first day, it is not in compliance with the law.

Section 2 of the form must be completed by the employer within 3 business days of the date of hire (defined as the employee’s first day of active work).

Provide employees with the instruction document and List of Acceptable Documents

The I-9 form has a 15-page instruction document as well as a List of Acceptable Documents. Both of these items must be made available to employees as they complete Section 1 of the form. This may be provided either in print or electronically.

Documentation must be presented in original form and unexpired

Employees must present, in person, original forms of identification used to verify identity and employment eligibility. These must be presented to the company representative who will complete Section 2 of the I-9 form. The documentation must be inspected for authenticity; if the company representative feels the document does not reasonably appear to be genuine or does not relate to the employee, the representative may reject the document and ask the employee to provide another document to satisfy requirements.

As a reminder, the employer may not specify the types of documents that can be used to validate identity and eligibility to work. This means that an employer should not say, “Please bring your driver’s license and Social Security card on your first day to complete the I-9.” Any documentation presented within List of Acceptable Documents may be used.

BCN Services can assist your business with proper form completion as well as audit preparation and response. Please contact us at 1-800-891-9911 with questions or if you need assistance.

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Alicia Freeman, Operations Manager

Starbucks incident points out employer responsibilities and actions

“Venti Chai Latte with two shots of espresso please.” That is one of my favorite drinks at Starbucks, or maybe an extra strong Americano with cream. On a recent visit, I saw the notice that Starbucks was closing all 8,000 stores on the afternoon of May 29 for unconscious bias education. This stemmed from a recent incident at a Philadelphia Starbucks in which a store manager called police as two black men visited the store and did not place an order, saying that they were waiting to meet with a colleague. Due to the manager’s action, the men were arrested and charged with trespassing. This raises the question of what is racial-bias and racial discrimination and what employers need to know about it.

Starbucks CEO Kevin Johnson has acknowledged the company’s fault, apologizing to the two men and the community and vowing to train and enlighten their employees as well as make such training part of the onboarding process for new partners.

What is racism and what are the signs?

In its most basic definition, racism is discrimination and negative stereotyping based on race or skin color. Racial discrimination occurs when an employee is discriminated against based on race or national heritage. While it is sometimes obvious and easy to spot, it is more often subtle and difficult to detect. Examples of blatant racial discrimination include the use of racial slurs, slurs masked as jokes or noticeable advancement issues. Signs also include strategic and obvious assignment of work duties, belittling and condescending conversation and other forms of unfair treatment. Federal laws prohibit this behavior. Racial discrimination in the workplace is strictly prohibited by many federal and state laws. Primary federal laws prohibiting racial discrimination fall under Title VII of the Civil Rights Act of 1964 which says employers cannot:

  • Fail/refuse to hire an employee based on race
  • Fire or discipline an employee based on race
  • Pay an employee less or provide fewer benefits based on race
  • Fail to provide promotions or opportunities to an employee based on race
  • Improperly classify or segregate employees or applicants based on race.

According to the federal Equal Employment Opportunity Commission (EEOC), which enforces Title VII, race discrimination is the most common type of reported workplace discrimination. In recent years, companies have had to pay upwards of millions of dollars to compensate victims of race discrimination.

Sometimes racial discrimination is subtle

Another form of racial discrimination is called micro-aggression, which refers to more subtle forms of racial bias such as petty slights or obstacles that can cause serious emotional harm over time or affect people in a variety of ways. Examples include:

  • Comments about a person’s race, including ones that are positive on the surface about the employee but belittle the person’s race (“You’re well-spoken for an Asian man”)
  • Jokes about a person’s race or about the race of an employee’s spouse or children
  • Unusual scrutiny given the actions of an employee of one race as opposed to others
  • Dress codes that are designed to prevent “ethnic” looks by controlling someone’s hair and clothing in a way that’s not necessary for the job.

Recognize the signs and take action

How can an employer recognize racial discrimination and combat racism? What sort of steps should an employee take if they have been a victim or have witnessed it?
In order to report racial discrimination, you first have to be able to recognize it. Here are some of the more obvious signs of disparate treatment and racial discrimination:

  • Assigning an employee job duties below their qualifications and job title, such as fetching coffee or filing
  • Consistently promoting employees of one race over another
  • Giving higher performance reviews to employees of one race over another
  • Not hiring a qualified candidate because he or she “wouldn’t fit in” due to race
  • Assigning employees of one race dangerous job tasks while giving safer, easier jobs to employees of another race.

If you believe you have been the victim of racial discrimination at work, there are steps to combat it and prevent it from continuing. Speak with your manager and/or the Human Resources Office immediately to report it – whether it is something you experienced or witnessed. Human Resources can protect both the affected employees and the company.

Take detailed notes of the occurrence, consult the employee handbook, and notify your business leaders of what’s going on so they can take reasonable steps to prevent it from continuing. Once the complaint is filed, the company is required to confront the issue and stop the behavior. If appropriate action is not taken, it can also be reported to the EEOC.

Although it may be difficult to identify racial bias or microaggressions, employers must address the issue and put a stop to the behavior. If you are a leader within your organization, listen to employees when they speak up about such situations. The first and best way to combat racial discrimination is to be willing to listen, empathize and learn. You can also follow the Starbucks example and ensure that your employees are well educated on what racial discrimination is and how to combat such actions and prevent them from happening.

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Thom Moore, Partnership Manager

Neglecting a garnishment could prove costly to your business

Employers receive garnishments for their employees for many reasons. Whether the order is for child support, a tax levy or creditor wage garnishments, it is extremely important that all such orders be handled promptly and accurately or employers can risk major consequences.

In most states, the employer may be liable for the full amount of a debtor’s outstanding debt, as well as interest and penalties. In extreme cases, employers deliberately violating a garnishment order may also be prosecuted criminally and face fines or imprisonment.

For terminated employees and those who have never been employed by the company, it is still necessary to complete any disclosure with this information, otherwise penalties and fines will still apply.

When receiving any garnishment order, the best practice is to send all paperwork received to your payroll specialist as soon as possible.  They must review these documents promptly to ensure that all employer requirements are met in a timely fashion. Depending on the order, this may include not only putting the order into place for future payroll deductions, but also handling written responses to the garnishing authority and/or employee and employee pay records to show earnings available for garnishment.

Proper garnishment administration will not only help your business avoid penalties but will ensure that your employees stay in good standing with the court order, as well.

The payroll team at BCN Services has a wealth of knowledge and experience in garnishment administration.  Please contact us at 1-800-891-9911 with any questions or for further information.

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Dani Austin, Payroll Supervisor

Time to take a fresh look at preventing harassment in your workplace

The “Me Too” and “Time’s Up” movements have garnered attention in the media, the legal community, the workplace and the agencies who protect our workplaces. There is a new culture beginning to emerge in the era of “Me Too” and “Time’s Up.” How should employers respond?

The Equal Employment Opportunity Commission (EEOC) reports increased inquiries about potential sexual harassment claims and the agency is prepping its investigators through intense training and education for a rise in complaints.  The legal community, for its part, reports an uptick in expectations and ever-increasing settlement demands.  There is a lower standard emerging for what constitutes pervasive harassing behavior.  Changes in legislation are anticipated to impact confidentiality agreements and business expense liability.  Both entities agree: It is time for employers to make meaningful cultural change and approach harassment prevention in a whole new fashion.

First, employers should focus on preventing all types of harassment including sexual harassment and harassment based on any protected characteristic such as gender, national origin, race, color, age, religion, pregnancy, genetics, military status, disability, etc.  Address the behavior before it escalates and consider behavior such as rudeness and incivility which leads to bullying and, left unchecked, leads to more pervasive, harassing behavior.

In other words, foster a work environment that is positive, comfortable and respectful.  To do so, take aim at these areas:

  • Leadership and Accountability: Establish a culture of respect in which harassment is not tolerated and make a commitment to assess harassment risk factors and take steps to minimize risks.  Allocate resources and time to a harassment prevention program and train mid-level managers and front-line supervisors to prevent and/or respond to workplace harassment.  Invest in best-practice preventive measures such as workplace climate surveys, training regarding civility in the workplace and bystander intervention training.
  • Anti-Harassment Policy: Establish a policy that is easy to understand, regularly communicated, and clearly states harassment of any type will not be tolerated.  It should be written in clear, simple words and in all languages used by members of the workforce.  A comprehensive policy will include:
    • A written description of prohibited conduct including examples.
    • A reporting system for those who experience or observe harassment. The reporting system must provide a prompt, thorough and impartial investigation.
    • A statement that identities of all (claimant, witness or target of the complaint) will be kept confidential to the extent possible.
    • A statement that any information gathered will be kept confidential to the extent possible.
    • An assurance that the employer will take immediate and appropriate corrective action if harassment has occurred.
    • A statement that retaliation against an individual who reports a claim or cooperates will not be tolerated and will be appropriately disciplined.
  • Complaint Procedure and Reporting System: This procedure should be available to employees whether they experience harassment or observe it. There should be multiple, readily accessible reporting channels. Employer representatives must be trained to: take reports seriously; conduct objective, neutral, thorough investigations; provide timely responses; protect the privacy of individuals to the extent possible; document all steps taken; take appropriate discipline action as warranted; and provide a reporting mechanism for individuals should they experience retaliation.
  • Investigation Procedure: Establish a prompt, thorough and impartial investigation protocol. Once an employer has knowledge of a complaint, an investigation must take place. This should include:
    • Meeting the minimum standard of the anti-harassment policy. Do what it says or more.
    • Identify who will conduct the investigation. More than one investigator is preferred.
    • In all cases, as information is gathered: Listen and document.  Offer assurance of non-retaliation.  Do not guarantee anonymity, but rather maintain confidentiality to the extent possible.
    • Gather information from the complainant, witnesses and from the accused.
    • Conduct an impartial review of findings and take appropriate corrective action if harassment occurred.
    • Communicate the determination of the investigation to all parties.
  • Training for Compliance: Establish a harassment prevention training program which provides bystander intervention techniques to teach people what they can say, and what to steps to take if harassment happens to them. A meaningful program will go beyond the legalese to focus on behaviors and non-verbal cues, encourage civility the workplace by stopping harassment where it starts, and promote a workplace culture that is positive, comfortable and respectful.  Harassment prevention training should include:
    • Examples tailored to the specific workplace and workforce.
    • Education for employees about their rights and responsibilities.
    • Using simple terms, a description of the reporting system.
    • An explanation of the consequences of unacceptable workplace conduct.
    • Encouraging managers and supervisors to practice situational awareness and address risk factors such as rudeness, incivility and bullying before the situation escalates to harassment.

Do you need help formulating a policy or taking action in workplace? Contact your HR specialists at BCN Services. We can help you begin the process for your company.

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Susan Price, Strategic Services Manager

Fraudulent unemployment claims on the rise in Michigan

Back in November 2017, several staff members at western Michigan television station WZZM 13 had unemployment claims filed in their names and the problem seems to be getting worse in the Grand Rapids area. There have been more than 100 reports taken since November in Walker alone.  Wyoming has reported 19, and Kent County overall has seen about one to six reports per week.

The result of unemployment insurance fraud is an increase in unemployment taxes for businesses: It threatens the availability of funds for people with legitimate unemployment insurance claims and burdens the state’s unemployment trust fund. After these recent data breaches, the agency anticipated an increase in false claims. However, they have put a higher degree of security measures in place, and the agency is catching most of the fraud before money is paid out.

How does unemployment fraud happen?

Unemployment fraud occurs when a perpetrator uses an individual’s personally identifiable information to file for unemployment benefits on the Unemployment Insurance Agency’s website.

According to WZZM13 reports, investigators say the criminals are from out of state and using the UIA because the agency typically tries to get people benefits as soon as possible.

What should you do if this happens to you?

  • Contact the Unemployment Insurance Agency immediately to report the fraud. Report fraud online at Michigan.gov/uia through the Report Fraud or Report Identity Theft link or call the UIA Fraud hotline at 1855-UI-CRIME.
  • Complete UIA Form 6349 Statement of Identity Theft and submit the form either in person at a Problem Resolution Office (PRO), by mail at Unemployment Insurance, PO Box 169, Grand Rapids MI 49501, or by fax at 517-656-0427.
  • Place a fraud alert on your credit record at the three credit reporting agencies (listed below) and get a copy of your credit reports. A fraud alert is free and will make it harder for someone to open new accounts in your name. To place a fraud alert, you only need to contact one of the three credit bureaus listed below. The company that you contact is required by law to tell the other two.

If you suspect a claim has been filed fraudulently in your name, contact BCN Services for additional resources and assistance.

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Lisandra Quiñones Garrow, Partnership Manager

Do workplace gender pay disparities really still exist?

The “Me Too” and “Time’s Up” movements have prompted discussions and brought to the forefront all aspects of sexual harassment and treatment of women in the workplace.  Part of this focus has put light on a subject that may have improved some over the last several decades, but is still not where is needs to be: Gender pay discrepancies.

The U.S. Census Bureau reports that in 2014, on average, women earned 79 percent of men’s median annual income.  The National Committee on Pay Equity, which reports a comparable statistic for 2014, 78.6 percent, has been documenting pay inequality since 1960.  If we look back 50 years prior to the 79 percent statistic, we can see that the gap has shrunk significantly.  In 1964, women earned only 59.1 percent of what men earned.  However, if you compare 2009 and 2014, the 5-year span saw an increase of only 1.6 percent.  There’s quite a way to go to bridge the gap completely.

A recent Hollywood scenario put into perspective how everyone, no matter what your job is, can fall into this statistical gap.  In reshoots for the movie “All the Money in the World,” Mark Wahlberg was paid an additional $1.5 million, while his co-star, Michelle Williams was paid $80 per day for a total of less than $1,000.  An open letter published by the “Time’s Up” movement stated that “the systematic gender equality and imbalance of power” in the workplace “fosters an environment that is ripe for abuse and harassment against women.”

Now is the time to reflect on your own company’s pay practices to bring gender pay in line and protect your company against future claims.  It’s not only good practice, it’s the law.  The Equal Opportunities Commission (EEOC) requires that equal pay for men and women be established under the Equal Pay Act of 1963.  The Equal Pay Act restricts employers from paying unequal wages “to men and women who perform jobs that require substantially equal skill, effort, and responsibility, and that are performed under similar working conditions within the same establishment.”

The EEOC looks at the following criteria to establish equal pay: Skill, effort, responsibility, working conditions, and establishment location (for example, when a company has several locations in different geographical areas, those can be considered separate establishments due to the area’s median income).  Differences in pay are only permitted based on seniority, merit, quantity or quality of production, or other factors not related to gender.  The EEOC also states that “It is also unlawful to retaliate against an individual for opposing employment practices that discriminate based on compensation or for filing a discrimination charge, testifying, or participating in any way in an investigation, proceeding, or litigation under Title VII, ADEA, ADA or the Equal Pay Act.”

If pay differences do exist for similar positions regardless of whether women are paid less than men, or men paid less than women, it is best practice to establish from the hire date how the salary decision was made.  Be prepared to back up how your wage determination was made based on the criteria previously mentioned.  Encourage open dialogue with your employees if they have a perception that a gender pay gap exists.  BCN Services staff are prepared to guide you through this process.  Please contact your Partnership Manager with any questions or concerns regarding your employees’ wages.

 

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Frank Lewandowski, Benefits Program Manager

Take care when classifying your workers to avoid costly audits

Job duties, not job titles, determine pay classification and workers’ compensation codes. Not making the correct choice can cause problems, or even prompt a workers’ comp or federal wage audit

When hiring a new employee, it is important to review the individual’s primary job responsibilities before determining whether they will be paid on an hourly or salaried basis.  It is also critical to determine a correct job code when reporting the new employee to your workers’ compensation carrier.

Although employers may have business reasons for making decisions, without professional guidance, employers can get caught on the wrong side of a Department of Labor wage and hour audit or a workers’ compensation audit.

Here are some key areas to consider:

Salary/exempt employees:  Many employers pay all office or supervisory employees on a salaried basis.  For most employers, that means no docking for missed time and no overtime pay.  This is a common violation with the U.S. Department of Labor and without timekeeping documentation, employers often lose during an audit.  Additionally, employees should not be paid on a salaried/exempt basis unless they make at least $455 per week and the employee’s primary duties include “the exercise of discretion and independent judgment with respect to matters of significance.”  Other factors may also apply to this decision about exempting an employee

Workers’ compensation class codes:  Insurance carriers often conduct workers’ compensation audits to determine whether employees are in the correct class code. Misclassification discovered during an audit can result in unexpected, additional insurance premiums. This can add up to thousands of dollars you were not expecting to pay.

1099 contract employees:  This is another area where employers should be sure they understand regulated guidelines.  Contract employees set their own hours, determine the amount they will be paid, determine how the work will be done, pay their own taxes and carry workers’ compensation insurance on themselves.  If you are issuing 1099s to individuals, yet directing their work, you may want to review this situation with one of our HR professionals.

Remember to take the proper steps to classify your employees correctly when they begin employment or change positions.  Let BCN help you before you get audited. Our HR staff is available to discuss any concerns you have in these areas, either regarding existing staff, or in determining direction before you make your next hiring decision.

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Sue Kester, HR Manager

Unannounced MIOSHA inspections can add up to employer fines

It appears MIOSHA (the Michigan Occupational Safety and Health Administration) has ramped up its “unannounced” inspections this past year with small business machine and repair shops and buildering contractors, both in General Industry or Construction categories.  Fines have been levied.  The wise adage “an ounce of prevention is worth a pound of cure” definitely has an application when it comes to safety in the workplace.

A multi-year review of the top 10 most frequently cited MIOSHA and OSHA violations show that violation types have remained fairly constant.  BCN Services will be dedicating this blog to safety issues throughout 2018 to raise awareness, educate and remediate the most serious of these violations.

No matter what the violation, the safety inspector always wants to see training plans.  When inspectors arrive, they check to see if the employer has properly trained employees regarding worksite hazards.  As a client of BCN Services, you have access, at no charge, to state-of-the-art, OSHA-compliant online safety courses for each of the following top 10 most serious violations, according to MIOSHA statistics:

  1. Lacking a hazard communication program – average fine: $512*
  2. Non-operational emergency eye flush stations – average fine: $933
  3. No effective information or training of chemicals – average fine: $497
  4. No written respiratory protection program – average fine: $865
  5. Exposure to air contaminants exceeding established exposure limits – average fine: $5,355
  6. Failure to provide appropriate eye and face protection – average fine: $565

Combined with no effective personal protective equipment training – average fine:  $690

  1. No program in place to determine if employees have a reasonable exposure to bloodborne infectious diseases – average fine: $820
  2. Failure to provide a medical evaluation to determine an employee’s ability to use a respirator – average fine: $596
  3. No written exposure control plan – average fine: $173
  4. No hearing conservation program when noise exposures equal or exceed the action level – average fine: $1,850

In addition to the above, there are several additional violations which include:

  • Lack of machine guarding
  • Improper wiring methods, components and equipment
  • Lack of forklift training
  • No fall protection program
  • Improper use of portable ladders
  • Using powered staplers and nailers with no proper eye protection
  • Employer not providing a safety harness when using an aerial lift

Once a fine is levied, MIOSHA will return to the employer’s site for follow-up.  Failure to correct a previously cited violation will result in additional fines averaging $2,554 per violation.

BCN Services’ safety program has dedicated resources providing safety walk-throughs, written programs, online safety training and recommendations at no charge for all of the above cited violations.  Our online safety programs average 15 minutes per course topic.  We also provide the OSHA 10-hour General Industry courses at least once per year by certified trainers.

Look for more specific information regarding the above in the coming year through our safety blogs.

Take advantage of all these resources and experience that “ounce of prevention” in 2018 for employee safety and peace of mind.  Call the Risk Management Department at BCN Services today at 734-994-4100, ext. 108 to access these programs.

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Patrick Boeheim, Risk Manager