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2018 W-4 Forms Won’t Be Released Until Late February | MD Benefit Advisors

If you’ve been getting questions from your employees about completing new 2018 W-4 forms to take advantage of the tax reform rules, we’ve finally received some answers. You can continue to rely on the current W-4 forms for now until the new 2018 form is released in late February.

The January 29th Internal Revenue Service (IRS) Notice 2018-14 provides additional guidance on the income withholding rules that were changed under the recently passed Tax Cuts and Jobs Act. The guidance:

  • Extends the effective period of Forms W-4 furnished to claim exemption from withholding for 2017 until February 28, 2018.
  • Permits employees to claim exemption from withholding for 2018 by temporarily using the 2017 Form W-4. This procedure will expire 30 days after the 2018 Form W-4 is released.
  • States that employees experiencing a change in status that causes a reduction in the number of withholding exemptions are not required to furnish employers with new withholding certificates until 30 days after the 2018 Form W-4 is released.
  • Provides that employees who have a reduction in the number of withholding allowances solely due to changes made by the Tax Cuts and Jobs Act are not required to furnish employers with new withholding certificates during 2018. However, employees may choose to update their withholding at any time in response to the act. Employees who choose to update their withholding may use the 2017 Form W-4 instead of the 2018 Form W-4 to report changes in withholding allowances until 30 days after the 2018 Form W-4 is released.
  • Confirms that the optional withholding rate on supplemental wage payments is 22 percent for 2018 through 2025.
  • Specifies that, for 2018, withholding under IRC 3405(a)(4) on periodic payments when no withholding certificate is in effect will be based on treating the payee as a married individual claiming three withholding allowances.

In addition to the guidance, the IRS also released a new Publication 15, (Circular E), Employer Tax Guide, for 2018. Publication 15 includes the 2018 withholding tables and explains an employer’s tax responsibilities, such as withholding, depositing, reporting, paying, and correcting employment taxes.

ThinkHR will continue to follow developments in this area and report on the availability of the new 2018 W-4 Form and other IRS guidance as it becomes available.

By Rick Montgomery

Originally published by www.ThinkHR.com

So Who Is a Paid Intern Now? | MD Benefit Advisors

On January 5, 2018, the U.S. Department of Labor’s Wage and Hour Division (WHD) created new guidance for determining whether a worker could be classified as an unpaid intern under the federal Fair Labor Standards Act (FLSA). The FLSA requires “for-profit” employers to pay employees for their work. Interns, however, may not be classified as “employees” under the FLSA and therefore are not entitled to compensation for their work. The new rules give employers more flexibility in establishing unpaid internships.

Under the previous six-factor test, an intern was considered an employee entitled to compensation unless all of the following factors were met:

  1. The internship, even though it included actual operation of the facilities of the employer, was similar to training that would be given in an educational environment;
  2. The internship experience was for the benefit of the intern;
  3. The intern did not displace regular employees, but worked under close supervision of existing staff;
  4. The employer that provided the training derived no immediate advantage from the activities of the intern, and on occasion its operations may actually have been impeded;
  5. The intern was not necessarily entitled to a job at the conclusion of the internship; and
  6. The employer and the intern understood that the intern was not entitled to wages for the time spent in the internship.

In its new guidance (Field Assistance Bulletin No. 2018-2), the WHD has adopted the “primary beneficiary test,” favored by several federal Circuit Courts, as the standard for determining whether interns at for-profit employers are employees under the FLSA. The primary beneficiary test examines the economic reality of the intern-employer relationship to determine which party is the primary beneficiary of the relationship. The following seven factors are used to make this determination:

  1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee — and vice versa.
  2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
  3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job after the internship.

What is different now is that not ALL of the seven factors must be met in order to determine employee status. According to the WHD, no single factor is decisive and the determination must be made on the unique circumstances of each case.

If analysis of these facts reveals that an intern is actually an employee, then he or she is entitled to both minimum wage and overtime pay under the FLSA. Conversely, if the analysis confirms that the intern or student is not an employee, then he or she is not entitled to either minimum wage or overtime pay under the FLSA.

What This Means for Employers

As a result of the new guidance, employers should review the status of any person working for them that they consider an “intern” and update their current internship programs to consider the WHD’s new rules.

Originally posted by www.ThinkHR.com

Ask the Experts: Can a well qualified older candidate fit on a much younger team? | Maryland Benefit Advisors

Question: We recently interviewed an older candidate for a position. She’s well qualified, but the team she would be working with is made up of people who are much younger, and we are worried about how she will fit in. Can the criteria to hire for cultural fit outweigh potential age discrimination concerns?

Answer: Your obligations under Title VII of the Civil Rights Act that protects workers from discrimination on the basis of age still apply, and you should weigh any employment decisions you make based on nondiscriminatory factors that include the applicant’s ability to do the job over age or generational concerns. While you should certainly think about company and even team culture when considering new hires, you may be putting the cart before the horse by worrying about how this new employee might fit, or not fit, with her new team. And, you might be overlooking the notion that older workers and millennials have more in common than you think.

For example, older workers may appreciate flexible work hours or alternative working arrangements, like many younger people in the workforce. Their responsibilities to children in the home may be done, while their younger counterparts may be pre-child-rearing stage. Older workers’ life-long experience, along with their work experience, may be highly valued and respected on a younger team. Older workers may be driven to learn new skills and new ways of working, just like their younger counterparts.

The experience of learning isn’t just about your older worker teaching or mentoring her younger teammates, however. Older employees benefit from working with younger generations in many ways, such as learning new technology, expanding mindsets to think more out-of-the-box when problem solving, and even finding encouragement to learn new skills and to think more creatively.

Adding a new employee of any age will pose challenges to a well-established team. If your candidate has the experience and the drive that will fit the position, assume all involved will enter into the relationship with open minds and will listen and learn from each other.

Originally posted by www.ThinkHR.com

Maryland Employment Law Update – April 2017

 

Employee Benefits Group is committed to keeping you updated with any changes to Maryland’s employment laws.  Below is a list of Employment Law Updates for April 2017:

Unemployment Insurance, Employer Determinations, and Process and Appeal Rights

On April 18, 2017, Maryland Governor Larry Hogan signed legislation (H.B. 139), which specifies the process and timeframe for an employer to exercise appeal rights related to employer determinations under the Unemployment Insurance Law. The legislation also requires the Lower Appeals Division to hear and decide appeals from the review determination decisions.

The law is effective October 1, 2017.

Read MD H.B. 139

Unemployment Insurance Electronic Information

On April 18, 2017, Maryland Governor Larry Hogan signed legislation (H.B. 135) authorizing the Maryland Department of Labor, Licensing, and Regulation, individuals, and employers to electronically send certain information and documents relating to unemployment insurance.

The law is effective October 1, 2017.

Read MD H.B. 135

Unemployment Insurance and Employer Exemption Upon Closure

On April 18, 2017, Maryland Governor Larry Hogan signed legislation (H.B. 141) that exempts employees of an employer that closes its business operation or part of its business operation for a definite period for inventory, vacation, or another purpose from the requirement to actively seek work during that period to be eligible to receive unemployment insurance benefits.

The law is effective October 1, 2017.

Read MD H.B. 141

Workers’ Compensation and Tiered and Merit Rating Plans

On April 18, 2017, Maryland Governor Larry Hogan signed legislation (H.B. 1315) authorizing a workers’ compensation insurer to develop a tiered rating plan that establishes discrete tiers based on risk attributes that are not arbitrary, capricious, or unfairly discriminatory and are reasonably related to the insurer’s business and economic purposes. The law also requires an insurer to submit a tiered rating plan to the insurance commissioner at least 30 days in advance of the plan’s use, and authorizes an insurer to use a specified merit rating plan under certain circumstances.

The law is effective October 1, 2017.

Read MD H.B. 1315

Workers’ Compensation, Permanent Total Disability, and Survival of Claim

On April 11, 2017, Maryland Governor Larry Hogan signed legislation (S.B. 426) into law, which clarified that if a covered employee dies from a cause that is not compensable under Md. Labor & Empl. Code Ann. § 9-640 (survival of compensation), the right to compensation that is payable and unpaid on the date of death survives to the extent of $65,000, as increased by the cost of living adjustments.

The law is effective October 1, 2017.

Read MD S.B. 426

Youth Sports Workers Exempted from Covered Employment Under Unemployment Insurance Law

On April 18, 2017, Maryland Governor Larry Hogan signed legislation (S.B. 70) clarifying that work performed by qualifying youth sports workers for youth sports organizations is not covered employment under the Unemployment Insurance Law.

The law is effective October 1, 2017.

Read MD S.B 70

Originally published by www.thinkhr.com