How OSHA Can Affect Your Business

The Occupational Safety and Health Administration was established within the Department of Labor and authorized to regulate health and safety conditions for all employers. (Similar state agencies may augment or supplant OSHA.)

OSHA was created to:

  • Encourage you and your employees to reduce workplace hazards and implement or improve existing safety and health standards.
  • Provide research in occupational safety and health, and develop innovative ways of dealing with such issues.
  • Establish “separate but dependent responsibilities and rights” for you and your employees for the achievement of better safety and health conditions.
  • Maintain a reporting and record-keeping system to monitor job-related injuries and illnesses.
  • Establish training programs to increase the number and competence of occupational safety and health personnel.
  • Develop mandatory job safety and health standards and enforce them effectively.

And here’s the “general duty clause” that says if there aren’t specific standards to address a given situation, you are responsible for following the intent of the act. It states: “each employer shall furnish to each of his employees employment and a place of employment which is free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.” It is this clause that allows OSHA to issue citations and fines.

Although all companies have to consider safety rules, in some businesses where injuries are common, like restaurants, it’s especially important.

You are responsible for keeping employees informed about OSHA regulations and the various safety and health matters that involve them. One thing you can do: Post materials from OSHA concerning employees’ rights and responsibilities, with copies of OSHA citations for violations of standards so employees can see that the violations were abated.

Sometimes, OSHA or NIOSH — the National Institute for Occupational Safety and Health — research activities require you to measure and record employee exposure to potentially harmful substances. Other times, you can expect workplace inspections that OSHA conducts to enforce its standards, focusing on imminent danger, catastrophic or fatal accidents, employee complaints, programmed high hazards and re-inspections.

OSHA fines for those who violate its rules can start at over $12,000 per incident and rise for willful or repeated violation.

Practical Help

If OSHA inspectors come to your place of business, here are some suggestions for working smoothly with them:

  • Answer questions truthfully without directly admitting guilt.
  • Don’t offer information unless it is asked for.
  • Be courteous.
  • Don’t discuss political views regarding OSHA or the federal government.

Before an OSHA compliance officer arrives for an inspection, he or she will conduct an opening conference. The officer will explain why he or she is there and what will happen next. You can ask the officer to wait while you assemble the appropriate people for the opening conference. A walk-through inspection will follow, with a discussion of the outcome and a plan for action if needed.

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Employee Leave Eligibility and Natural Disasters

 

The aftermath of a hurricane raises questions about employers’ obligations under such laws as the Family and Medical Leave Act and the Americans with Disabilities Act when a natural disaster is involved.

The FMLA doesn’t require employers to give their workers time off to attend to personal matters arising out of a natural disaster — cleaning a flood-damaged basement, salvaging belongings or searching for missing relatives, for instance.

However, an employee would qualify for FMLA leave when, as a result of a natural disaster, the employee suffers a physical or mental illness or injury that meets the definition of a serious health condition, rendering the worker unable to perform their job. FMLA is in effect as well if an employee is required to care for a spouse, child or parent with a serious health condition affected by the natural disaster.

Here are two examples:

  • A hurricane causes your employee’s blood pressure to soar, rendering him unable to perform his job. If medical certification supports the need for leave, then FMLA leave kicks in.
  • A worker’s family member develops a serious health condition related to the natural disaster. Say an employee’s parent suffers from diabetes and the power goes out in the parent’s home. The employee may need to help administer the parent’s medication, which must be refrigerated. Again, that may trigger a mandated leave.

While employees who are physically or emotionally injured as a result of a natural disaster may be entitled to FMLA leave, if the impairments rise to the level of disability, then potential employer obligations kick in under the ADA. Sometimes, a medical condition may arise several weeks or even months after the natural disaster hits. You need to be vigilant in watching for signs of an employee scarred by a natural disaster.

If you’re thinking post-traumatic stress disorder, you’re right — it can arise from a natural disaster. You’d have to consider FMLA and ADA obligations: You may need to provide FMLA leave as well as reasonable accommodations for employees — an option to telecommute or work from home or provide leave so they can attend counseling or receive medical treatment.

You need to obtain as much information as possible from the employee to determine whether the absence qualifies as protected leave. When in doubt, provide the requisite FMLA paperwork and allow your worker to provide the necessary information to support the FMLA leave.

Also, make sure that medical certification is sufficient to cover the absence. Where more information is required, employers must follow up with a worker to get information necessary to designate the absence as FMLA leave. You have a right to seek a second opinion to ensure FMLA leave is appropriate.

Finally, keep in mind this is just a general introduction and summary to a complex series of laws and regulations. Call us to discuss your particular situation.

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5 Steps to the Successful Multi-Office Business

Each new office seems deserving of all your time, but there are still your existing offices, whose need for attention hasn’t diminished. Building, disseminating and maintaining a cohesive business strategy across multiple sites is a challenge, but you need to get it right to continue to be successful.

Step one: Information needs to be shared.

This means that no one is behind on information, and you create a sense of community. Technology makes this happen because it allows immediate, widespread communication. You must ensure that there is one main method of digital communication — inconsistently used initiatives quickly become difficult to manage effectively. Use the one tool that works well and commit to communicating relatively frequently through it. You may want to send a brief weekly email newsletter to all staff. The tricky part is working across time zones, so if possible, send official communications when all offices are open.

Step two: Your leadership team is your greatest asset.

Employing an excellent senior management team to undertake communication on the company’s behalf is as important as digital communications. Have a senior management team member assist in running the firm, coordinating each office to provide local leadership. It’s wise to have a strong chain of command and a team that integrates as much as possible with each other to keep everyone informed about work across the company. Strong departmental management complements the businesswide strategic vision.

Step three: Timing is everything.

It’s essential to maintain a top-level presence across all offices and to be a recognizable face to all employees. If your company is based in one region, try to visit each office every month. If your firm is spread across the country, visit every two or three months. Time your visits within a week of each other and give a little more attention in your weekly email newsletter to any office that hasn’t been visited in a timely manner.

It makes sense to prioritize visits according to the size of the office, while maintaining a high level of inclusion in digital communications to show staff that they are highly valued.

Step four: Integrate wherever possible.

Encourage cross-office collaboration to develop a wider understanding of the business as a whole. It’s healthy to work with a number of different people and conducive to caring about the business beyond each office’s four walls. One means of doing this is to give staff opportunities to shape the company’s image, such as by participating in brand workshops or to be personally involved in company improvements.

Step five: Don’t be afraid to try something new.

Always try new things and commit to change. What suits one business may not suit another. Be prepared to innovate to find what works for you. That’s why building a personal relationship with as many employees as possible works — you’re giving people a chance to mix with others they would never normally work with.

Don’t forget the value of old-fashioned face time among and across teams. By encouraging this, you will contribute to successful integration and a corporate culture across geographies. Local offices need to be held accountable for quality control, scheduling and improving systems, and such efficiencies may work companywide.

All of this can seem like a lot of hard work, but splitting time between offices and building a system of shared information is crucial to the overall success of multi-office businesses. By trying to achieve equilibrium, you create a happy workforce that delivers the best results.

 

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Bracket Changes and More From the IRS

You haven’t even filed your 2017 taxes yet, but the IRS has already announced changes that will affect your 2018 taxes, which you’ll be filing in 2019. The changes were announced in Revenue Procedure 2017-58, which runs 28 pages, but below are some key points. How do these changes impact you? Give us a call, and we’ll explain how they change your tax situation.

Of course, if any meaningful tax reform is passed, anything can be changed. We’ll keep you posted on any developments that affect you.

  • The standard deduction for married filing jointly rises to $13,000 for tax year 2018, up $300. For single taxpayers and married individuals filing separately, the standard deduction rises to $6,500 in 2018, up from $6,350 in 2017, and for heads of households, the standard deduction will be $9,550 for tax year 2018, up from $9,350 for tax year 2017.
  • The personal exemption for tax year 2018 rises to $4,150, an increase of $100. The exemption is subject to a phase-out that begins with adjusted gross incomes of $266,700 ($320,000 for married couples filing jointly). It phases out completely at $389,200 ($442,500 for married couples filing jointly).
  • The bracket changes have not gone up significantly from the previous year. For example, the floor for the 28 percent “married — filing jointly” category is up from $153,101 to $156,151. The details of each bracket are described in the revenue procedure.
  • The Alternative Minimum Tax exemption amount for tax year 2018 is $55,400, and begins to phase out at $123,100 ($86,200 for married couples filing jointly, for whom the exemption begins to phase out at $164,100). The 2017 exemption amount was $54,300 ($84,500 for married couples filing jointly). For tax year 2018, the 28 percent tax rate applies to taxpayers with taxable incomes above $191,500 ($95,750 for married individuals filing separately).
  • The tax year 2018 maximum Earned Income Credit amount is $6,444 for taxpayers filing jointly who have three or more qualifying children, up from a total of $6,318 for tax year 2017. The revenue procedure has a table providing maximum credit amounts for other categories, income thresholds and phase-outs.
  • For tax year 2018, the monthly limitation for the qualified transportation fringe benefit is $260, as is the monthly limitation for qualified parking.
  • For calendar year 2018, the dollar amount used to determine the penalty for not maintaining minimum essential health coverage remains as it was for 2017: $695.
  • For tax year 2018, for participants who have self-only coverage in a Medical Savings Account, the plan must have an annual deductible that is not less than $2,300, an increase of $50 from tax year 2017, but not more than $3,450, an increase of $100 from tax year 2017. For self-only coverage, the maximum out-of-pocket expense amount is $4,600, up $100 from 2017. For tax year 2018, for participants with family coverage, the floor for the annual deductible is $4,600, up from $4,500 in 2017; however, the deductible cannot be more than $6,850, up $100 from the limit for tax year 2017. For family coverage, the out-of-pocket expense limit is $8,400 for tax year 2018, an increase of $150 from tax year 2017.
  • For tax year 2018, the adjusted gross income amount used by joint filers to determine the reduction in the Lifetime Learning Credit is $114,000, up from $112,000 for tax year 2017.
  • For tax year 2018, the foreign earned income exclusion is $104,100, up from $102,100 for tax year 2017.
  • Estates of decedents who die during 2018 have a basic exclusion amount of $5.6 million, up from a total of $5.49 million for estates of decedents who died in 2017.
  • The annual exclusion for gifts increased to $15,000, an increase of $1,000 from the exclusion for tax year 2017.

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Managing a Unionized Workforce

You may have both union and nonunion employees. If a union is voted in by some of your employees, they are union members, not union employees — they are your employees. How to deal with them? Apply the same good management techniques you’ve always used in the past.

Approach managing all employees the same way, whether they’re represented by a union or not. Effective management applies to both — be honest, communicate well and often, listen to and resolve issues as they arise, recognize and reward good performance, and create an environment of trust and respect.

Discipline yourself to treat all employees the same — once you start to treat them differently, they will begin to look at and react to you differently.

Learn how to work with shop stewards — the first level of representation for your workers represented by a union. Work with them as though they are an extra set of eyes and ears for you: a partner helping manage your employees. A steward can be a helpful ally for the wise manager.

Resolve disputes quickly and fairly. Formal grievance procedures are standard in most union contracts, but they’re only there if you and your employee can’t resolve a disagreement first. Talk to the people in your organization who can help you — your supervisor or HR — and then work openly with your shop stewards and employees.

This can be a positive — you negotiate with a set group of people who are elected representatives of the workforce so that you can come to an agreement on changes to terms of employment relatively easily. These reps can help you pinpoint and deal with issues upsetting people and reducing performance.

Know the Rules and Contracts

The laws and rules governing unionized work are complex and vary depending on the union. The union will refer to the contract in negotiations and even during day-to-day work. So the more familiar you are with contract terms, the more effectively you’ll be able to respond to questions or challenges.

Approach the union as a business partner, not an adversary. Tell the union representative if you are having problems with a unionized employee. He or she may be able to provide assistance. Put time into establishing trust with everyone on your team, including union representatives.

Spend time with the team outside of work — consider, for example, volunteer days when everyone volunteers for a social project in the community. Share important information as soon as you reasonably can. Tell union reps about upcoming changes or breaking news early to give them a chance to brush up on the issues. That way, they’ll be prepared to answer questions from members. When you give them a heads up, it builds trust and establishes a practice of open communication.

When you have a good partnership with union representatives, you can ask for their help in solving disciplinary issues. By treating your employees with respect and creating an environment of trust, you’ll have a workforce willing to give you the benefit of the doubt, confident enough to be understanding when your business needs to be flexible, and comfortable talking with you — rather than their union representatives — about their concerns. There may be times when the truth is complicated or difficult to explain, but your employees will understand and respect you for being straight with them.

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Big Changes in Social Security and Retirement Plans for 2018

From 401(k) plans to individual retirement accounts to Social Security, the federal government has been busy in recent weeks adjusting numbers for 2018. Whether you’re an employee or business owner, senior management or nonexempt staff, these changes may affect how you approach retirement in the coming months and years.

Social Security: New ceilings

First, let’s start with what is not changing. The 7.65 percent Social Security deduction remains the same. And as before, it’s doubled to 15.30 percent for the self-employed.

However, the maximum earnings subject to Social Security rises from $127,200 to $128,700, a $1,500 increase. The Society for Human Resource Management estimates that this change means 12 million more workers will be paying more Social Security tax than before. The 1.45 percent Medicare portion, which has no ceiling, remains unchanged.

Those who are working while collecting Social Security catch a small break: The SSA is raising slightly the amount people can earn before losing a portion of Social Security benefits. The new amounts are $10 or $40 a month, depending on the recipient’s status.

Another significant change is to the maximum Social Security benefit for those retiring at full retirement age, which changes from $2,687/month to $2,788/month, a $101 increase. More details are available on the Social Security site.

Retirement plan limits rise

Workers who can afford to do so can put away a little more for retirement: The limit for 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan is increased from $18,000 to $18,500.

It’s a little more complicated for those contributing to IRAs:

  • For single taxpayers covered by a workplace retirement plan, the phase-out range is $63,000 to $73,000, up from $62,000 to $72,000.
  • For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is $101,000 to $121,000, up from $99,000 to $119,000.
  • For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $189,000 and $199,000, up from $186,000 and $196,000.
  • For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

Roth IRA contributors also get a bump up: The income phase-out range is $120,000 to $135,000 for singles and heads of household, up from $118,000 to $133,000. For married couples filing jointly, the income phase-out range is $189,000 to $199,000, up from $186,000 to $196,000. The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

Some IRA numbers are not changing, however:

  • The limit on annual contributions to an IRA remains $5,500. The additional catch-up contribution limit for individuals age 50 and over remains $1,000.
  • The catch-up contribution limit for employees age 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan remains unchanged at $6,000.

These are just summaries of complex rules. Be sure to give us a call so we can explain how these changes may affect your situation.

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A How-To Guide on Managing the Ubiquitous Form 1099

One of the most important tax and payroll issues a company has to address is who is an actual employee and who is an independent contractor. Once you have that worked out, your next step is making sure each category of workers gets the right forms. True employees get a Form W-2 each year, and freelancers — independent contractors — get a Form 1099-MISC. This form can be used for a variety of payments, and one of the most common and significant uses is for independent contractors.

You must issue a Form 1099-MISC to each nonemployee you pay $600 or more during the year, and this is a requirement for all trades or businesses. For the purpose of this form, even a nonprofit is considered a trade or business. Federal, state and local governments also have to issue these forms.

Corporate payments

The adaptable Form 1099-MISC is also required in a variety of payments to corporations:

  • Medical and health care payments.
  • Attorneys’ fees.
  • Substitute payments in lieu of dividends or tax-exempt interest.
  • Payments by a federal executive agency to vendors for services.

However, except for the specified situations, Form 1099-MISC is not typically used for corporate payments. Indeed, there are many payments for which Form 1099-MISC is not appropriate:

  • Payments for merchandise, telegrams, telephone, freight, storage and similar expenses.
  • Payments of rent to real estate agents.
  • Military differential wage payments made to employees while they are on active duty in the armed forces or other uniformed services (report on Form W-2).
  • Business travel allowances paid to employees (may be reportable on Form W-2).

If you’re not sure which form to use and when, give us a call. We’ll be happy to help you sort out the details.

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