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New Form W-4 Does Not Apply to All State Tax Withholding – Are You Using the Right Forms?

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All Employers

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January 1, 2020

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In December 2019, the IRS issued a new Form W-4 to reflect the elimination of withholding allowances because individuals can no longer claim personal or dependency exemptions. While this was intended to allow for more accurate federal tax withholding calculations, it raises the question of what employers should do with respect to state tax withholding requirements.

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Minnesota: Split-Day Overtime is Over

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All Employers with MN Employees

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September 18, 2019

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In In re Minnesota Living Assistance, Inc., the Minnesota Supreme Court stated that employers cannot use split-day overtime to comply with state overtime rules, where employees have not yet worked the overtime hours meant to comply with state overtime rules. There, the employer paid employees one rate for the first 5.5 hours worked in a 16-hour day, and 1.5 times that rate for the remaining 10.5 hours. The Court stated that the Minnesota Fair Labor Standards Act requires employers to pay employees overtime for all hours worked in excess of 48 in a week, regardless of whether the employee received time-and-a-half compensation during the first 48 hours worked.

Additionally, time-and-a-half wages paid during the first 48 hours worked in a workweek cannot be excluded when calculating an employee’s regular rate of pay, because those hours were not paid for overtime work (which are excluded when calculating the regular rate of pay). Because federal Fair Labor Standards Act overtime rules vary compared to the state rules, employers must take care to comply with both.

Action Items

  1. Review split-day overtime policies and procedures to ensure compliance with state wage and hour rules.
  2. Have payroll processes updated.
  3. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2019 ManagEase

Minnesota: New Wage Theft Prevention Bill Greatly Expands Employer Responsibilities – And Potential Penalties

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All Employers of MN Employees

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July 1, 2019

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The Jobs and Economic Development Omnibus bill (the Bill), recently passed by the Minnesota Legislature and signed by Governor Walz, impresses upon employers new wage-paying requirements.  The Bill incorporates new timing, notice, and recordkeeping obligations for employers, and greatly expands civil and criminal enforcement of wage payments. Employers should note the following key provisions:

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March Updates

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Varies

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This Short List addresses the following topics:
  1. U.S. Supreme Court Reversed Ninth Circuit Equal Pay Ruling Based on Judge’s Death
  2. Fifth Circuit: Restated Its Position that Title VII Does Not Protect Sexual Orientation
  3. California: Guidance on New Agricultural Overtime Pay Requirements
  4. Alameda, CA: City Minimum Wage Increases to $13.50 in July, Regardless of Employer Size
  5. Florida: Miami Beach Minimum Wage Struck Down
  6. Illinois: $9.25 Minimum Wage by January 2020, With New Possible Penalties
  7. Minneapolis, MN: Minimum Wage Increase Approved
  8. New Jersey: $10 Minimum Wage in July 2019, $15 by 2024
  9. Westchester County, New York: Bans the Box
  10. Portland, Oregon: Prohibits Discrimination Against Atheists and Agnostics
  11. West Virginia: Federal Law Enforcement Pension Freed From State Taxes

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Minnesota: Duluth Becomes Third City to Enact Paid Sick and Safe Time Law

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All Employers with 5 or more Duluth, MN Employees

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January 1, 2020

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Duluth recently joined St. Paul and Minneapolis in enacting a local paid sick and safe time law.  While the new paid sick leave (“PSL”) ordinance mirrors St. Paul and Minneapolis in most provisions, it also deviates from these cities in some areas–most notably in the accrual rate, cap, and carryover of PSL hours.  The ordinance, adopted on May 29, 2018, goes into effect on January 1, 2020, providing employers ample time to prepare.

Key provisions of the new PSL law include:

  • Effective Date: January 1, 2020
  • Eligibility:
    • Covered Employee: Employees who (1) work in Duluth for more than 50% of their working time within a 12-month period or (2) are based in Duluth, work primarily in Duluth, or do not spend more than 50% of their working time within a 12-month period working somewhere else.
    • Employer: All private employers of five or more employees. Note that employers need not be based in Duluth to meet coverage requirements.
    • Exemptions: Independent contractors, student interns, seasonal employees, or individuals otherwise covered by the Railroad Unemployment Insurance Act.
  • Usage: Employees can begin using PSL after 90 days of employment, and may use up to 40 hours of PSL per year.
  • Leave Amounts
    • Accrual Rate: One hour per 50 hours worked.
    • Cap: Employees must be allowed to accrue up to 64 hours pf PSL per year.
    • Carryover: Employees may carry over up to 40 hours of PSL each year, unless PSL is frontloaded.
    • Frontload: Employers have the option to frontload 40 PSL hours per year.  Employers may frontload PSL following an initial 90 days of employment in an employee’s first year, but must frontload at the beginning of each subsequent year.
  • Recordkeeping and Notice Requirements:
    • General Notice: Employers must notify employees that they are entitled to PSL, the amount of PSL, and the terms of use under the law. However, there is no workplace posting requirement.
    • Anti-Retaliation Notice: Employees must be informed that retaliation is prohibited, and that employees may file a written complaint of retaliation with the City clerk.
    • Recordkeeping: Employers must maintain records documenting hours worked and accrued/used leave for a period of three years.
  • Employee Notice: Employees may request PSL as needed. PSL requests should include the expected duration of the absence, if possible. Employers can request reasonable documentation that PSL was used for an applicable purpose after three consecutive days of absence.  Further, employers may require employees to follow their standard procedures for absences or leave requests so long as the procedures do not infringe on an employee’s PSL rights.

Action Items

  1. Visit the City of Duluth’s dedicated page on Earned Sick and Safe Time.
  2. Prepare for implementation of the new PSL requirements, including having employee handbooks, policies, and payroll practices updated.
  3. Have managers trained on PSL use and notice requirements.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2018 ManagEase

Upcoming Minimum Wage Increases

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Certain Employers with Employees in CA, DC, IL, ME, MD, MN, OR

EFFECTIVE

July 1, 2018

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Minimum wage increases typically fall into the beginning or middle of each calendar year, with many states or localities increasing minimum wage rates in July.  Below is a short list of localities with upcoming minimum wage increases effective July 1, 2018.

Minnesota: Employers Cannot Fire Employees for Refusing to Share Tips

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All Employers of MN Employees

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October 11, 2017

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The Supreme Court of Minnesota recently affirmed that employers cannot terminate an employee for refusal or failing to share gratuities.  In Burt v. Rackner, Inc., a bartender was instructed to share a greater portion of his tips with bussing staff.  Upon his failure to do so, the bartender was terminated, and he filed a lawsuit for wrongful termination.

Minnesota: Non-Compete Agreements Require Additional Consideration Other than Continued Employment

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All Employers of MN Employees

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October 6, 2017

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On October 6, 2017, a Minnesota federal district court emphasized the importance of appropriately presenting restrictive covenants.  Minnesota employers who require employees to sign restrictive covenants, such as a non-compete agreement, have certain obligations to the timing and type of consideration that must be offered with the restrictive covenant.  Specifically, new applicants must be provided the non-compete agreement before accepting the offer of employment, and currently-employed individuals must be provided something of value beyond continued employment as consideration.

Eighth Circuit: Overtime Eligibility for Van Drivers Determined by Present Configuration of Vehicle, Not Original Manufacture

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All Employers with AR, IO, MN, MO, NE,
ND, and SD Employees who operate vehicles

EFFECTIVE

May 10, 2017

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In LaCurtis v. Express Medical Transporters, Inc., the Eighth Circuit determined that the present design and configuration of a vehicle, rather than its original manufacture capacity, determines the vehicle driver’s eligibility for overtime pay through the Motor Carrier Act exemption of the Fair Labor Standards Act.

June Updates

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This Short List addresses the following topics:
  1. IRS Announces 2018 Health Savings Account Limits
  2. Colorado: Wage Violations are Now Public Record
  3. Missouri: Minimum Wage Preemption Bill Soon to be in Effect
  4. Oregon: Final Rules to Implement Retirement Savings Program Published
  5. Washington: Statewide “Blacklist” Statute Revives the Defunct Federal Rule
  6. Minnesota: Preliminary Rules, Other Resources for Minneapolis/St. Paul Paid Sick Leave Now Available
  7. Pittsburgh, PA: Paid Sick Leave Confirmed Off the Table; Appeal Expected

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