Below is an excerpt from The American Institute of Professional Bookkeepers (AIPB) 2016 Bookkeeping Tips e-letter.
I highly recommend a membership in the AIPB as the best way to stay informed and up-to-date on news and issues that can directly affect your business.
For all summer hires (or hires any time of the year):
· Obtain W-4s from all summer employees, even the owners’ children, students working part-time and foreign students.
· Withhold FITW from all employees, including the owner’s spouse or child, unless a W-4 claims exempt.
· Withhold FICA from all employees, even high school students and those who receive SS benefits.Exception: Those under 18 working for sole-owner parents.
Pay overtime for hours actually worked over 40 hours in the workweek. You are not required to include as hours worked paid time off (holidays, vacation days). Do not substitute paid nonwork hours for work hours to make all hours straight time, thus avoiding overtime pay.
Example: Julia works 12 hours a day the first 4 days of the workweek, but not on the 5th day, a holiday, for which she is paid for 8 hours. She is correctly paid 40 hours’ straight time + 8 hours’ overtime + 8 holiday (nonwork) hours. Julia’s employer cannot substitute the 8 hours’ holiday pay for the 8 hours’ overtime to avoid paying the overtime rate.
Paid holidays and vacations
· Under federal law, paid holidays for part-time and summer help are always optional, but check state laws.
· No paid vacation is required—but if you provide paid vacation, some federal and state laws apply.
Benefits
· For temps and part-timers, benefits are optional; but if offered, they should be explained in a written benefits plan.
Always check your state’s laws.
I highly recommend a membership in the AIPB as the best way to stay informed and up-to-date on news and issues that can directly affect your business.
For all summer hires (or hires any time of the year):
· Obtain W-4s from all summer employees, even the owners’ children, students working part-time and foreign students.
· Withhold FITW from all employees, including the owner’s spouse or child, unless a W-4 claims exempt.
· Withhold FICA from all employees, even high school students and those who receive SS benefits.Exception: Those under 18 working for sole-owner parents.
Pay overtime for hours actually worked over 40 hours in the workweek. You are not required to include as hours worked paid time off (holidays, vacation days). Do not substitute paid nonwork hours for work hours to make all hours straight time, thus avoiding overtime pay.
Example: Julia works 12 hours a day the first 4 days of the workweek, but not on the 5th day, a holiday, for which she is paid for 8 hours. She is correctly paid 40 hours’ straight time + 8 hours’ overtime + 8 holiday (nonwork) hours. Julia’s employer cannot substitute the 8 hours’ holiday pay for the 8 hours’ overtime to avoid paying the overtime rate.
Paid holidays and vacations
· Under federal law, paid holidays for part-time and summer help are always optional, but check state laws.
· No paid vacation is required—but if you provide paid vacation, some federal and state laws apply.
Benefits
· For temps and part-timers, benefits are optional; but if offered, they should be explained in a written benefits plan.
Always check your state’s laws.
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