by admin | Jun 13, 2019 | Human Resources, IRS
Question: Are amounts an employer reimburses employees for mileage taxable?
Answer: They may be; the type of reimbursement plan will dictate whether reimbursement for business travel is or is not taxable. Both accountable plans and non-accountable plans allow an employer to reimburse employees for their business expenses.
With an accountable plan, the reimbursement is not taxable to your employee. Amounts paid under an accountable plan are not wages and are not subject to income tax withholding and payment of Social Security, Medicare, and Federal Unemployment Tax Act (FUTA) taxes. Your reimbursement or allowance arrangement must meet all of the following conditions in order to quality as an accountable plan:
- There must be a business connection to the expenditure. This means that the expense must be a deductible business expense incurred in connection with services performed as an employee of the employer. If not reimbursed by the employer, the expense may be deductible by the employee from their taxable income.
- There must be adequate accounting by the employee. This means that the employee must give their employer a statement of expense, an account book, a diary, or a similar record in which they entered each use at or near the time it occurred, along with date, mileage, and the business purpose of the use.
- Excess reimbursements or advances must be returned within a reasonable period of time.
A non-accountable plan does not meet the three requirements for accountable plans and is subject to all employment taxes and withholding. Payments under a non-accountable plan occur if: (1) the employee is not required to substantiate expenses with receipts or other documentation in a timely manner; and (2) the employer advances an amount to the employee for business expenses and the employee is not required to, and does not, return any amount he or she does not use for business expenses in a timely manner.
Employers should also check with their state department of taxation to understand any state tax rules applicable to them.
For more detailed information on federal mileage reimbursement, see the IRS page containing Publication 463, Travel, Entertainment, Gift, and Car Expenses, and updates to this publication since its publication date.
Originally posted on ThinkHR.com
by admin | May 14, 2019 | Employee Benefits, Human Resources
While more and more perks — catered lunches, on-site gyms, immunizations programs — are about employee health, wellness, and happiness, they ultimately are also designed to keep workers at work. A recent article in Quartz at Work points out that more than anything, employees want more time off and out of the office. Unlimited time off, to be exact.
Once the perk of tech firms and startups, more companies are beginning to explore unlimited paid time off. And, though still rare at only one to two percent of companies, it’s a popular request in part because workforce demographics continue to shift. Nearly half of employees are Millennials, whose priorities are changing the benefits conversation. For this group, finding more balance and having more control of their time are key. In part, this may be because time off has fundamentally changed. Well and Good looks at the fact that, with near-constant connectedness, vacation days often still involve checking email and getting other notifications.
Add to that cultural and workplace expectations of accessibility and availability, and workers are at risk for burnout. One in four workers report feeling burned out all the time and almost half feel burned out sometimes. This burnout can cost employers in lost productivity, and employees in terms of health and happiness. Today, someone doesn’t need to psychically spend 90 hours a week at the office to be working 90 hours. With our always-on lives, restorative time off is rarer but still as important to prevent burnout.
That doesn’t mean every business is jumping on the unlimited time off bandwagon. Want other ideas? A writer for The Guardian suggests a middle ground, with more days off the longer an employee has worked at a company. And, while rollover sounds generous, it may make employees less likely to use it. Want to give it a try but concerned about misuse? Business Management Daily suggests it’s also more than reasonable to consider limits on unlimited and critical to set sound guidelines around pay as well as whether days off can be all in a row.
For many employees, unlimited time off offers the extra flexibility for life’s challenges and can aid satisfaction and retention. Before HR Departments worry the system will be abused, research shows that people take significantly less time off when it’s unlimited. In fact, what may be more impactful is a minimum number of days off may be required so as to ensure employees take advantage of a benefit meant to restore and replenish their energy, creativity, and engagement. To work, it needs to be modeled by managers and other higher-ups, as a CEO details in a Chicago Daily Herald article.
By Bill Olson
Originally posted on ubabenefits.com
by admin | May 2, 2019 | Human Resources
2019 has ushered in many new trends such as retro cartoon character timepieces, meatless hamburgers, and 5G networks to name a few. Not surprisingly, trend-watching doesn’t stop with pop culture, fashion, and technology. Your company’s human resources department should also take notice of the top changes in the marketplace, so they are poised to attract and retain the best talent. These top trends include a greater emphasis on soft skills, increased workforce flexibility, and salary transparency.
SOFT SKILLS
Gone are the days of hiring a candidate solely based on their hard skills—their education and technical background. While the proper education and training are important factors in getting the job completed, a well-rounded employee must have the soft skills needed to work with a team, problem solve, and communicate ideas and processes. According to Tim Sackett, SHRM-SCP and president of HRU Technical Resources in Michigan, “Employers should be looking for soft skills more and training for hard skills, but we struggle with that.” While hard skills can be measured, soft skills are harder to quantify. However, soft skills facilitate human connections and are the one thing that machines cannot replace. They are invaluable to the success of a company.
WORKFORCE FLEXIBILITY
As millennials begin to flood the workplace, the traditional view of the workweek has changed. Job seekers report they place a high importance on having the flexibility of when and where to work. The typical work day has evolved from a 9am – 5pm day to a flexible 24-hour work cycle that adjusts to the needs of the employee. Employers are able to offer greater flexibility about when the work is completed and where it takes place. This flexibility has so much importance that job seekers say remote work options and the freedom of an adaptable schedule have a higher priority to them over pay.
SALARY TRANSPARENCY
In the wake of the very public outing of the gender and race pay gaps, companies are opening up conversations about wages in the workplace. Once a hushed subject punishable by termination, salary information is now often being shared in the office. Employers have found that the more transparent and open that they are about the compensation levels in their organization, the more trustworthy they appear to their workforce. One way to stay educated on the welcome trend of pay equality is to visit the US Bureau of Labor Statistics’s website to review wage ranges across the nation. Another great resource is the Department of Labor’s free publication called “Employer’s Guide on Equal Pay.”
By watching the trends in the marketplace, employers can focus on what is important to their staff. Honest discussions about salary and compensation, when and where to work, and developing the employee as a whole, including soft skills, sets your company up for success. When you listen to what the market is saying, you show you are sensitive to what their priorities are—and this is always on trend.
by admin | Mar 20, 2019 | Compliance, Human Resources
Even when you proactively anticipate all the people risks that have the potential to impact your workplace, it’s easy to convince yourself there is no risk to you — that it will never happen here.
You may think no one at your workplace will harass anyone, no one will sue you over an honest mistake made in administering workers’ comp, no one will accidentally cause a data breach, or no one will ever bring a weapon to the office. You might think managing people risk is extremely time consuming and not worth the effort. Rationalizations like this may lead you to believe you don’t need to do anything to prevent these risks.
However, these risks are very real and can happen anywhere, at any time. It’s imperative you cover all of your bases, and it’s actually very straightforward, especially if you have a partner on your side.
Ideally, you will integrate people risk management (PRM) with your business practices so it’s not something extra to do; it’s a way of doing things you already do. PRM can be a lens through which you look through when evaluating your policies, procedures, and other aspects of how you run your company.
Acknowledging and Preventing Risk: A Four-Step Plan
When you are anticipating risk, you are thinking about what might happen. Then you need to look at what you should do when something actually happens and it’s time to acknowledge the risk.
Maybe a law passes or regulation is finalized, you realize your pay policies are not in compliance with the law, or an employee informs you they have been prescribed medical marijuana but you have a very strict drug use policy. What tools to do you have to deal with that?
Once you acknowledge the risks inherent in these issues, there are four steps to putting a plan of action into place to prevent the risks from causing damage to your company’s bottom line, its reputation, or to its level of employee engagement:
- Understand when and how the risk will impact you. If it’s a law or regulation, when does it go into effect? Is it an ongoing issue or something that can be addressed and then set aside? What are the potential penalties or pitfalls presented by the risk?
- Determine the best course of action. Does the situation require simple changes to operations or a more complicated approach? Where do changes need to be implemented — in handbook policy updates, procedural documentation, or new training programs?
- Craft communication strategies around the risk. Who needs to know what, and how much information should be given to people at each level? What information should be held back to preserve confidentiality? What information is only relevant to a handful of people (such as when an OSHA report is due) and what information is relevant to everyone (such as who needs sexual harassment training in your state)?
- Decide what change management activities are required to get buy-in. It’s one thing to decide to do something but getting people ready to embrace the change is another thing. If change management is good, then the changes will take hold, the implementation will be smooth, and the risks will be lower.
by Larry Dunivan, CEO of ThinkHR
Originally posted on ThinkHR.com
by admin | Mar 5, 2019 | Compliance, Human Resources
We are all drinking from a firehose of news and information — all day, every day. With this deluge of information, it can be difficult to determine what’s truly important to know. But being reactive is not acceptable. You need to know what’s coming, what affects you, and how it affects you.
Take, for example, legislative changes — 80 percent don’t require your attention, but the 20 percent you need to act on can easily get lost in the noise. It’s the 20 percent that expose your business to risk, but how do you know which 80 percent of information you can safely ignore?
Paying attention to the right information at the right time and setting the rest aside – knowing what you need to know – is essential to anticipating and understanding risk.
Where People Risk Management Comes In
People risk management starts with anticipating and understanding what presents risks to your business. It’s the idea you can look at something, understand it, digest it, and know if and how you need to act on this information. It’s a complicated sequence that no one has time to do, which is why you need a trusted and knowledgeable partner who:
- Knows what’s in the pipeline, such as newly-introduced bills that have the potential to become law.
- Keeps an eye on at what’s actually happening that may affect employers, such as when bills pass, agencies issue directives, or courts rule on cases.
- Determines what presents any type of risk to employers – such as litigation, noncompliance, or reduced employee engagement – and what doesn’t require action.
- Communicates promptly, consistently, and effectively, so you can use this knowledge to update your policies, stay on top of compliance requirements, and incorporate best practices in a way that reduces risk for your unique business.
Understanding People Risks: An Example
Often, when we think about risks to employers, we focus on insurable risks because they are well understood and easily quantifiable. It’s important to address these risks with solid prevention plans and insurance products, but it’s the uninsurable categories of risks, particularly people risks, that can catch us off guard and unprepared.
People risks can result not just in financial loss, but damage to employee engagement and company culture. They tend to be more subject to interpretation and can be very abstract.
Take, for example, the consequences of hiring the wrong employee or losing a valued employee. When this happens, you bear the cost of lost productivity and the time and money invested in recruiting, hiring, and onboarding. You also risk litigation if policies are not adequately documented, communicated, and followed should the employee claim discrimination, harassment, or disability accommodation is to blame for their separation from the company.
Hiring the wrong employee or losing a valued employee also carries the risk of negatively affecting employee engagement, which is a well-documented predictor of business outcomes. If it happens regularly, or there is even one instance handled poorly, your employment brand can be tarnished. For example, it could result in bad reviews on recruiting sites, chipping away at your recognition as an employer of choice.
Be in the Know
Whether it’s knowing how legislative changes affect your business or what risks are inherent in day-to-day employee management issues, people risk management starts with a solid knowledge base that evolves continuously to keep up with the latest employment trends, news, regulation, and information.
by Larry Dunivan, CEO of ThinkHR
Originally posted on ThinkHR.com
by admin | Jan 4, 2019 | Human Resources
Question: Our company received a survey from the U.S. Census Bureau asking about the health coverage we offer to employees, how much it costs, etc. Is this an official survey? Do we have to provide the information?
Answer: It appears your company has been randomly selected for the federal government’s Medical Expenditure Panel Survey (MEPS). Here is a sample of the 2018 survey.
The U.S. Census Bureau conducts a variety of studies on different schedules. The most widely known one is the once-a-decade census of the entire U.S. population, but the Bureau also conducts surveys every year of randomly-selected individuals and businesses on different topics. It has used the MEPS for several years to collect data on health insurance spending, the availability of employer-provided coverage, costs paid by employers and workers, and to study trends over time. Policy makers and health care researchers use the data in aggregate form, while each participant’s data is kept confidential.
It is your choice whether to respond to the MEPS. There is no penalty if you do not answer some of the questions or if you decide not to return the survey at all. Your participation is entirely voluntary.
To learn more about the MEPS, see the FAQs that the Census Bureau has prepared for businesses.
by Kathleen Berger
Originally posted on ThinkHR.com
