Are your HR policies and practices in order? Now’s the time to check
Traditionally, the start of the new year is the time many of us reflect on and review a variety of personal issues and resolve to take the necessary steps for change and improvement.
For those of us who are also responsible for running all or part of a business, we may carry this over to our professional lives as well. As part of our professional review, it is important not to overlook the human resource issues affecting our businesses.
The good news is that few, if any, new human resource laws are expected from the federal government in 1999. Although several initiatives are under way to overhaul the Occupational Safety and Health Act (OSHA), Congress is not expected to make that a priority.
While businesses may not have to worry about coping with new HR laws, the start of the new year does require businesses to get ready to meet certain imposed deadlines for state and federal regulations already on the books.
Following are some reminders:
W-2 Forms: Employers are required to furnish each employee with 1998 income on a W-2 form by Jan. 31. The W-2 form serves as a wage record for the employee and employer and is required for state and federal income tax purposes.
OSHA 200 Log: Most employers with 11 or more employees are required to maintain an OSHA 200 Log, which is a summary of injuries and illnesses. This information is compiled on OSHA Form 200. Compare the information listed on your OSHA 200 Log to your internal accident reports and Worker’s Compensation WC-12 forms for completeness and accuracy. The portion of the OSHA 200 form to the right of the vertical dotted line is used to summarize injuries and illnesses for the previous calendar year. Your OSHA 200 for 1998 must be completed, signed and posted by Feb. 1. Even if your establishment had no recordable injuries and illnesses, the summary portion, including zeroes across the total line, must still be posted. Post the OSHA 200 Log for the entire month of February in a place where employees are likely to see it.
On March 1, take the form down, and add it to your OSHA 200 file. OSHA 200 Logs must be retained and kept available for the current year and for the previous five calendar years for inspection and copying by current and former employees, their representatives and OSHA.
Family Medical Leave Act: Remember to reset the clock on absences granted under Wisconsin’s Family Medical Leave Act (FMLA). Unlike the separate federal FMLA, the state FMLA requires employers to grant unpaid time off on a calendar-year basis. Therefore, your employees start 1999 with the full amount of protected time off under this act. Wisconsin grants six weeks for the birth or adoption of a child, two weeks for the employee’s own serious health condition, and two weeks to care for a family member (child, spouse, parent, or parent-in-law) with a serious health condition.
Wisconsin employers are covered by the state FMLA if they employ at least 50 individuals anywhere – not just in Wisconsin. To receive protection under the state FMLA, an employee must be employed with you for more than 52 consecutive weeks and have worked at least 1,000 hours during the preceding 52-week period. Note: All hours for which the employee receives pay, i.e. vacation, sick, must be counted in the calculation of the 1,000 hours “worked.”
Administration of the FMLA is cumbersome at best. It is of great help to track time off under the FMLA on a form or spreadsheet. Record the date, type of leave, number of hours or days taken, and whether the leave time was paid through the substitution of vacation, personal days, sick days, etc. If your payroll system is computerized, develop a code which indicates in the payroll history when time off is FMLA time.
W-4 and W-5: The start of a new year is a great time to remind employees to update their “Employee’s Withholding Allowance Certificate” or W-4 form. During the last year, an employee may have had a change in family status which affects his tax withholding. Send a company announcement reminding employees to complete a new form available from payroll.
The “Earned Income Credit,” or W-5 form, is less known but can be of great benefit to certain employees. The W-5 has the potential to reduce the taxes an employee owes. Employees with one or more children may be eligible for this tax credit based on income, marital status, and number of children. Paying less in taxes means more take-home pay – something every employee likes. This is a great benefit to promote, without any direct costs to the employer. For an employee to continue to receive a tax credit, a new W-5 must be completed and filed with payroll each calendar year.
W-4 and W-5 forms are available by calling the IRS form order line at 1-800-829-3676.
The Meaning of 15, 20, 50, or 100: As you complete your business plan or anticipate company growth, be aware of the additional laws which affect employers when their employee head count reaches 15, 20, 50, or 100 employees. For example:
Social Security Tax Rates: Make sure your payroll processor knows the new Social Security tax limits. Effective Jan. 1, 1999, the Social Security tax base is $72,600. There is no wage limit for the Medicare portion. The tax rate stays at 7.65% of gross earnings for the Social Security portion and 1.45% for the Medicare portion.
Resolutions: A New Year’s article wouldn’t be complete without offering resolutions! Welcome in the new year by developing several important practices that will help safeguard your organization.
Documentation: Fully document employee performance issues – remember to document areas for improvement, and also document what the employee does well.
Provide regular and timely feedback to employees. Don’t give performance evaluations only once a year – make feedback a natural part of your management responsibilities.
Training: Invest in upgrading the skills of your supervisors. Key training topics include effective and legal interviewing, performance coaching, sexual harassment, communication and listening skills, and employment laws. Your payback will be enhanced employee relations because your supervisors will handle employee issues consistently and confidently.
Retention: 1999 looks to be another year where a tight job market will be the norm. To counter this, many employers are shifting their attention to something they can more readily control: retention. Keeping your good employees makes good business sense. Look at wages, benefits, work environment issues, flexible scheduling, increasing communication to employees and recognizing good work.
The above article is the first in a series provided for Small Business Times by MRA-The Management Association, of Brookfield. The association can be reached at 797-7590.
HR Update, Resolutions
1 Reset the clock for counting absences under the Wisconsin Family Medical Leave Act. Individuals who have worked more than 52 consecutive weeks and accumulated at least 1,000 hours of work time are protected by this act.
2 Change the Social Security tax base limit to $72,600. There is not a wage limit for the Medicare portion. The tax rates stay at 7.65% of gross earnings up to $72,600 for Social Security and 1.45% of total gross earnings for Medicare.
3 Send all employees their W-2 forms for 1998 income by Jan. 31, 1999.
4 Post your completed and signed OSHA 200 form by Feb. 1, 1999, and keep posted for the entire month of February. Post in a location easily accessed by employees.
5 Inform employees about updating their W-4 form for tax withholding and/or (re)complete their W-5 to take advantage of a tax credit available for employees with children. The W-5 tax credit may increase certain employees’ take-home pay based on earnings, number of children, etc.
6 Remember that passing certain employee head-count thresholds (employee # 15, 20, 50, and 100) means compliance with some additional employment laws. Plan ahead and be ready to meet any new requirements.
7 Resolve to develop these good business practices: Fully document employee performance issues. Be clear on expectations and timeframes for improvements. Solid documentation is a good first line of defense.
– Increase the formal training opportunities for supervisors and managers. Effective communication, positive employee relations, and knowing key employment laws are basic skill requirements for anyone managing people.
– Change your focus from recruiting new employees to retaining current employees. Be aware of employees’ wants and needs and try to be responsive.