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Retirement Plans: Major Changes to the 403(b) Rules; How to Prepare

Section 403(b) of the Internal Revenue Code is undergoing its most significant changes in decades. The IRS has issued final regulations for retirement plans governed by Section 403(b) and maintained by nonprofit and tax-exempt organizations and public schools for their employees’ benefit. The plans may be funded through annuity contracts issued by an insurance company, […]

Deferred Compensation Plans: Take Time Now to Ensure Compliance with Section 409A

Internal Revenue Code Section 409A regulates deferred compensation plans and other arrangements, including severance plans, annual bonus payments, long-term incentive arrangements, stay bonuses, and settlement agreements upon termination. Section 409A rules govern compensation that was deferred or became vested after Jan. 1, 2005. Because employers have faced many difficulties trying to comply with these rules, […]

Bulletin: Government revises Form I-9

The U.S. Citizenship and Immigration Services (USCIS) has released a new Form I-9, which you can access at www.uscis.gov. Five documents, which employees previously could have submitted for proof of identity and employment eligibility, were removed from List A because they lack sufficient features to help deter counterfeiting, tampering, and fraud. Employers can no longer accept […]

Bulletin: New state minimum wage goes into effect on Jan. 1, 2008

As of the first of the year, California’s minimum wage will be $8.00 per hour, up from the 2007 rate of $7.50. Keep in mind that this rate increase affects not only hourly, nonexempt workers but also salaried, white-collar exempt employees. As of January 1, the minimum monthly salary for these exempt employees will rise […]

Exempt Employees: Deductions for Disability Leave Didn’t Violate Salary Basis Rule; Tips for Reviewing Your Plan

Under California and federal law, an exempt employee must receive his or her full salary for any week in which the person performs any work, regardless of the quality or number of hours worked. This is known as the “salary basis” rule. If you dock an exempt employee’s weekly salary, you could violate this rule […]

Employment Law Tip: Exempt Employees and Holiday Shutdowns

During the holiday season, many employers shut down their operations for a few days over Thanksgiving, Christmas, or New Year’s. If you’re thinking of closing up shop for the remaining holidays this year, first make sure you’re up on special pay rules for employees who qualify as exempt from overtime. Paying Overtime: 10 Key Exemption […]

Taxes: New Law Requires Earned Income Tax Credit Notice to Employees

A new law that goes into effect on Jan. 1, 2008, requires employers to provide a new notice to employees, along with annual wage summaries (such as W-2 or 1099 forms). The measure, A.B. 650, requires all California employers to give all employees written notice of employees’ possible right to take an Earned Income Tax […]

Seniority: Do We Have to Bend Our Strict Seniority System to Offer a Reasonable Accommodation?

We have a strict seniority system. Do we have to bump one of our workers to give another employee a reasonable accommodation under the Americans with Disabilities Act? — Anonymous    How To Survive an Employee Lawsuit: 10 Tips for Success With lawsuits against employers becoming ever more common—and jury verdicts skyrocketing—your risk of getting […]

Disabilities: How Do We Determine Whether an Employee Is a Safety Threat?

We have a large workforce, and many people operate machinery, fork trucks, etc. Plus, many handle hazardous substances. We now think that some employees have medical conditions that may cause them to lose concentration, and we have some other employees who may be taking medications that might affect their ability to work safely. How do […]

Claims Adjusters Don’t Qualify for Overtime Exemption

Liberty Mutual’s claims adjusters investigated and estimated claims, made coverage determinations, negotiated settlements, and identified potential fraud. The claims adjusters sued the insurer for back overtime pay, claiming they were misclassified as exempt administrative employees. A California appeals court has now ruled in the employees’ favor, finding that they didn’t qualify for the administrative overtime […]