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Posts by michael

New Court Ruling: Contractor vs. Employee Definitions

in News and Features

Earlier this year, the California Supreme Court clarified rules around who is a contractor and who an employee. The good news is that the court did in fact make the situation clearer. The bad news is that for some who were operating in the grey areas of the old rules, that territory shrunk substantially and they will want to review their classifications. The ruling found that workers are assumed to be employees unless three factors can be proven … The “ABC Test” permits workers to be classified as independent contractors only if the hiring organization demonstrates that the worker in question satisfies all three of the following conditions: (A) That the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of the work and in fact; (B) That the worker performs work that is outside the usual course of the hiring entity’s business; and, (C) That the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed. For most businesses, this is simply a clarification that narrows the grey area. Just make sure you’re still classifying your workers correctly. However, for some, such as Beauty Shops and Salons, it could present a major departure from being in the business of renting space to contractors to becoming the employer of those workers. For assistance in figuring this out, call Sequoia Personnel Services at (707)...

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What is Co-Employment?

in News and Features

What is Co-Employment? Co-Employment is simply dividing up responsibility between the onsite employer and a professional employment services provider like Sequoia Personnel. As your “co-employer,” we pay the employee taxes and process employee paychecks which include tracking PTO, sick leave, and other information to keep you compliant with labor regulations.   But if I co-employ with you, am I still the boss? Am I still the one making decisions about my employees? According to employment law, when you co-employ with a professional employer service provider like Sequoia Personnel, we then become the “employer of record.” But you are in charge of your operations and your business, and for supervising the employee. You are still the boss making the final call. While you will still make decisions around hiring, performance, and firing, you will have Sequoia Personnel’s help on the HR side. This may include help with recruiting and screening employees, dealing with discipline issues, and developing and implementing workplace policies.   Do I pay any additional taxes because I co-employ with Sequoia Personnel? No, but with one important caveat. A recent study has shown that employers who co-employ with a service like Sequoia Personnel grow 7-9% faster. This faster growth is achieved by being able to focus on your core competencies while outsourcing the rest of those time-consuming, labor-intensive HR services. This growth often leads to more revenue, which leads to more taxes! So there could be more taxes… and that might be a good thing!   Can I co-employ and still have my own group health insurance plan? Yes, both federal and state law allows you, as the employer, to choose which benefits you offer to your employees. One of the advantages of Co-Employment with a professional provider is that you will have access to an expanded marketplace – an option to select from a wider array of employee benefits at prices that are often only available to large employers. This allows you to compete for the best talent when recruiting new employees.   Learn more about Co-Employment!  ...

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New Ruling Affects Overtime/Bonus Rules

in News and Features

Earlier this month, the California Supreme Court today issued a ruling that affects employers who pay employees a flat rate bonus and overtime. The court ruled that when calculating overtime in pay periods in which an employee earns a flat rate bonus, employers must divide the total compensation earned in a pay period by only the non-overtime hours worked by an employee.   All California employers who pay such bonuses should review their policies and pay practices to ensure compliance with this decision (Alvarado v. Dart Container Corporation of California). For assistance in figuring this out, call Sequoia Personnel Services at (707) 445-9641.   Beginning with the most basic premise, employees who perform work in excess of defined statutory limits are entitled to overtime pay under both federal and California law. Generally, both statutory schemes provide for pay at a rate of 1.5 times the “regular rate” earned by the employee.   The regular rate calculation at issue in the Alvarado case involves how to compute the regular rate under California law when an employee is paid a flat sum bonus during a single pay period.   Under the federal Fair Labor Standards Act, the regular rate includes all compensation, earnings, or “remuneration” for work performed, with specific payments excluded—such as reimbursed expenses, reporting-time premiums, vacation or holiday pay, or discretionary bonuses. Each of these exceptions have their own specific requirements and employers should consult with a labor and employment attorney for any questions on these exceptions. If an employee earns only an hourly wage, the regular rate likely would be the hourly wage.   However, if there are additional payments, the regular rate is calculated by dividing all earnings (excluding those payments mentioned above) by the total number of hours actually worked. This provides a fairly simple equation: all weekly earnings / all hours worked = regular Rate. Once calculated, employees are then generally entitled to compensation at 1.5 times all hours worked in excess of 40 hours in a workweek. Oftentimes, employers will calculate overtime by first paying the regular hourly wage for all hours worked, including overtime, and then paying an overtime premium at one-half the regular rate for all overtime hours worked.   California generally follows the federal rules with...

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Top 5 New California HR Laws for 2018

in News and Features

The new year is when the largest number of new state personnel regulations take effect. This year, there are many new regulations. The most widely applicable, as we see it, are these three:   1. “Ban the Box” (AB 1008) What it does: Employers with 5 or more employees cannot inquire about criminal history before an offer of conditional employment is made. They can run criminal background checks after the offer and prior to first day of employment. However, deciding not to hire based on a criminal conviction needs to be directly job-related, and communicated in writing with the applicant given a chance to respond.   2. Parental Leave (SB 63)   What it does, in brief: Employers with 20 to 49 employees must provide eligible employees with up to 12 weeks of job-protected, unpaid leave to bond with a new child. This includes children by birth, adoption or foster care. You can think of this as extending CFRA (the California Family Rights Act) to employers with as few as 20 employees.   3. Salary History (AB 168) What it does, in brief: Employers can’t ask about salary history. If an applicant volunteers salary information, the employer may take that into consideration when deciding whether to hire the person and how much to pay them. It remains o.k. to ask what salary they seek.   4. Immigration Protections (AB 450) What it does, in brief: Employers cannot provide access to employee records without a subpoena or warrant. This also goes for allowing federal immigration agents access to areas of a business that are not public. There are also procedures specified when it comes to notifying employees of federal inspections of employment records, such as I-9 forms.   5. Minimum Wage Just a reminder that as of 1/1/18, the minimum wage for employers with 25 or fewer employees increases to $10.50 per hour, while the minimum wage for employers with over 25 employees increases to $11.00 per hour.   Confused? Want to get out of the labor regulation business and back to your real work? Call Sequoia…we have...

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California’s minimum wage is increasing!

in News and Features

Effective January 1, 2018, the overtime rate for minimum wage employees is: Employers with 26 or more employees: $11.00 per hour Employers with 25 or fewer employees: $10.50 per hour   The minimum wage rate change also affects the classification of employees as exempt versus nonexempt. For an employee to qualify under the commonly used administrative, executive or professional exemptions from overtime, the employee must meet the salary-basis test (which means the employee’s salary must be no less than two times the state minimum wage for full-time employment) in addition to meeting all other legal requirements for the exemption. That minimum salary rate is $45,760 annually, effective January 1, 2018, for employers with 26 or more employees. For employers with 25 or fewer employees, the minimum salary threshold for the administrative, executive and professional exemptions is $43,680 for 2018. Confused? Want to get out of the labor regulation business and back to your real work? Call Sequoia … we have...

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