Best of our understanding for the programs described below. First of all, this is NOT a political commentary on whether we like or dislike Obama's agenda - not intending to start a political blog. Simply put, these are areas which will impact payroll programs and W-2s. Many of us in the tax business are placed in situations where we have to interpret W-2s, and many of us actually provide payroll services to our clients.
First is a presidential edict on Labor Day regarding sick leave. Employers must now grant sick leave up to 7 days annually - what's more it is my understanding that these cannot be "use it or lose it days" i.e. unused sick leave may be carried over to the next year, thus invoking accrual basis expense for unpaid sick leave (much the same as for vacation). Effective January 1.
Next is something as recent as last week - not a presidential edict but a directive to the Secretary of Labor to write DOL regulations which place a minimum salary level whereby employers can designate someone as being "exempt" from overtime. The current status quo is an employer can today call a person a "manager" or give a prestigious job title in order to avoid paying overtime, but the pay structure is still so low as to work a guy until he is ready to drop for only 40 hours pay. I've heard this minimum salary level is right at $47,000. Effective December 1.
My post is to invite comments correcting me if I'm wrong, and give other amplications on the information given that will be helpful. For example, the first item may or may not lead to another code in box 12, 13 or 14 of the W-2, although vacation is not currently disclosed in either box. Box 13 contains a check-mark for sick pay, which could now be grossly misleading since I believe this is third-party payments by insurance companies.
If my information above is correct, I believe the first item will significantly alter payroll computations and accrual-based accounting, whereas the second item will simply bloat W-2s. Regardless of what we may hear, another party or administration is not likely to block or rescind these actions, since it will adversely affect so many working people.
First is a presidential edict on Labor Day regarding sick leave. Employers must now grant sick leave up to 7 days annually - what's more it is my understanding that these cannot be "use it or lose it days" i.e. unused sick leave may be carried over to the next year, thus invoking accrual basis expense for unpaid sick leave (much the same as for vacation). Effective January 1.
Next is something as recent as last week - not a presidential edict but a directive to the Secretary of Labor to write DOL regulations which place a minimum salary level whereby employers can designate someone as being "exempt" from overtime. The current status quo is an employer can today call a person a "manager" or give a prestigious job title in order to avoid paying overtime, but the pay structure is still so low as to work a guy until he is ready to drop for only 40 hours pay. I've heard this minimum salary level is right at $47,000. Effective December 1.
My post is to invite comments correcting me if I'm wrong, and give other amplications on the information given that will be helpful. For example, the first item may or may not lead to another code in box 12, 13 or 14 of the W-2, although vacation is not currently disclosed in either box. Box 13 contains a check-mark for sick pay, which could now be grossly misleading since I believe this is third-party payments by insurance companies.
If my information above is correct, I believe the first item will significantly alter payroll computations and accrual-based accounting, whereas the second item will simply bloat W-2s. Regardless of what we may hear, another party or administration is not likely to block or rescind these actions, since it will adversely affect so many working people.
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