Counting Employees

Counting Methods

How Do I Hate You? Let Me Count the Ways

Another update from the Jungle….

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Billy and Bobbye opened their business a year after they married.  They hired a couple of employees and everyone was happy.  Billy and Bobbye were proud of their success. Employees enjoyed the perks, like having the company cover 100% of health insurance premiums for employees and the Friday Afternoon Frazzle at a nearby brew pub.

unnamed-15But as the company expanded, new employees lacked the camaraderie of the ones who had helped build the business. Adding employees meant more personality conflicts and scheduling difficulties. Bobbye wanted to add some structure to the company by creating HR policies to ensure everyone understood what was expected of them.

Billy wasn’t ready to give up the entrepreneurial attitude of the early days so he shot down Bobbye’s ideas.  Their disagreement about the business spilled over into their marriage. Before long, they were taking potshots at each other every day.

unnamed-11Bobbye decided to change the brand of coffee for the office.  A day after the change, Billy walked in to the break room, saw the new brand name, and hurled the coffee can across the room into the garbage can.  Now Billy and Bobbye don’t talk to each other in the office. They relay messages through employees. Their employees used to call them B&B or B-squared. Now it’s Bombs Away.

All these spats are tanking the bottom line as deadlines are missed and quality crashes. Clients leave for calmer and more reliable service. To save money, Billy decides arbitrarily to reduce the number of unnamed-13employee perks, starting with the health plan. He tells employees they will have to begin contributing to the premium.  Cutting back on perksannoys the employees and Bobbye.

unnamed-17Even free beer at the Friday Afternoon Frazzle can’t attract most employees because they feel so uncomfortable around Billy and Bobbye. The least bright employees are choosing sides. The smarter employees are trying to stay neutral. The smartest employees have already bailed out for more stable workplaces.  On its present trajectory, the company will implode.

What should Billy and Bobbye do next?

  1. They can continue to fight until there is nothing left but the company’s debts.
  2. They can seek marriage counseling to save their marriage and possibly their company.
  3. They can agree to divorce and split the company’s assets as part of the divorce settlement.

In the actual situation, the feuding owners divorced and the wife bought her former’s husband’s interest in the business. Some employees helped with the transition while most left for other jobs.

If your company is struggling with HR issues, Corporate Compliance Risk Advisor can help you create HR policies that are appropriate for your company’s size and then serve as a resource to your staff as the policies are implemented.

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It Says So Right Here!

Another update from the Jungle….

Jane started her business after being downsized by her corporate employer.  She knew she wanted her business to be different from the bureaucracy of her Big Biz employer and vowed to avoid the burden of written policies.  

3But as she adds employees it becomes clear that a lack of written policies is bad for the bottom line. No written policies allow Evan to claim that he doesn’t know he is supposed to start work at 8:30 am. He thinks showing up by 10 am is okay as long as he gets his work done.  

4Jane decides she needs something in writing. She digs out an old copy of Big Biz’s employee handbook. She customizes it by changing the employer’s name, correcting a few typos, and changing the font.  Then she gives a copy to each employee and receives a signed acknowledgement from each employee.

None of the employees actually read the employee handbook, of course, until they need to. Evan reads the section on progressive discipline after Jane gives him a final written warning about his attendance.

1Meanwhile, Audrey discovers she’s pregnant. She hauls out her copy of the handbook, which is propping up a corner of her desk, and unfolds it to read the section on the Family Medical Leave Act (FMLA). She tells Jane she wants to take FMLA leave to have her baby and asks for the leave request form.  

Jane doesn’t have any FMLA forms. Her internet search eventually leads her to the U.S. Department of Labor (DOL) website where she learns the horrible truth about the FMLA. It applies to companies with more than 50 employees. Her Little Biz shop has 20 employees.  The news is so disturbing that she drinks half a bottle of wine while she thinks about her options.

What should Jane do next?

  1. She can collect every copy of the handbook and burn them in the parking lot knowing that most of her employees never read it.
  2. She can tell Audrey that the FMLA section of the handbook is a mistake because that law doesn’t apply to Jane’s business.
  3. She can grant FMLA leave to Audrey in accordance with the handbook policy. Then she can immediately revise the handbook to delete information about employment laws that don’t apply to her company.

The above scenario is a common problem for small business owners who lack familiarity with employment laws. The lack of familiarity can fix one problem while creating many more problems.

Join the HR Compliance Jungle today. Click here!

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Visit us at: http://www.complianceriskadvisor.com/

Click here for a copy of my free Ebook 

Can My Company Live With the ACA?

Another update from the HR jungle….

Bob owns a company with 60 employees. He’s always offered health insurance to his headquarters employees but not to employees in the retail locations. The retail location employees tend to quit often, work varying schedules each week, and may have health coverage via a spouse’s employer’s plan. Bob decided long ago that it was a hassle to handle all the paperwork adding and terminating employees from the group health plan. So it was easier to not offer health insurance to the retail location employees.

Bob’s a sharp guy (that’s why he owns a company) and he’s tried to keep up with all the changes under the Affordable Care Act (ACA or Obamacare). He knows that his company is a “large” employer under the ACA because he has more than 50 employees. He knows that means his company could pay a penalty if the employee group health plan doesn’t meet the minimum standards set in the ACA, including offering coverage to most full-time employees.

Bob is concerned that some of the retail location employees may actually be full-time employees, meaning that they should be offered health insurance for calendar year 2015. Bob has also heard that there is transitional relief for employers with 50 – 99 employees. The transitional relief applies only to the 2015 calendar year but if his company meets the requirements, he gets another year penalty-free while he sorts out what he must do.

What options are available to Bob?

1. He could read the IRS regulation explaining the transitional relief requirements. (Bob’s tried reading IRS regulations before and he’d rather get his teeth drilled than go through that again.)
2. He could ask for assistance from the insurance agency or broker that sold the group health plan to his company, assuming they provide human resources assistance to clients.
3. He could take a quick look at the employer summaries on the IRS website and then wing it and hope it all works out.

Is your company struggling to understand how the ACA will affect the employee group health plan? Corporate Compliance Risk Advisor can help you grasp the basics of the ACA and how it affects an employer of your company’s size.

Join the HR Compliance Jungle today. Click here!

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How Many Employees Do We Have?

Another update from the HR jungle….

David is the HR director for his company. He’s attended seminars about the Affordable Care Act (ACA or Obamacare) but found most of the presentations confusing. He wasn’t sure what his company needed to do to comply with the law and, with all the delays in implementation, he moved this topic down his list of priorities.

Now David needs explain to the company owners what needs to be done to comply with the ACA. He knows the first step is to verify whether they are a “large” or a “small” employer. A large employer has at least 50 employees and is subject to an employer penalty if it doesn’t offer health insurance to its employees.

David’s company has 40 employees that work an average of 30 hours per week and so are full-time employees under the ACA. But his company also has 15 part-time employees.

How should David count the part-time employees under the ACA?

1. Add up the total hours worked during the month by the 15 part-time employees. Let’s assume that during the past month they collectively worked a total of 1260 hours.
2. Divide their aggregated hours by 120 (30 hours/week x 4 weeks = 120 hours per month). So David divides 1260 hours by 120. (1260 ÷ 120 = 10.5)
3. Round down to the nearest whole number. So David rounds down 10.5 to 10. During the past month the part-timers worked hours that are equivalent to 10 full-time employees. (That’s why part-time employees are called “full-time equivalents” or FTE’s).
4. Add the 10 FTE’s to the 40 full-time employees for a total of 50 employees. That means that in the past month, his company was a “large” employer under the ACA.

David should select 6 consecutive months in which to use the above formula to verify his company’s employer size. If during this 6 month counting period, the company has 50 employees, it is a “large” employer.

Is your company struggling to understand how the ACA will affect the employee group health plan? Corporate Compliance Risk Advisor can help you understand the basics of the ACA and how it affects an employer of your company’s size.

Join the HR Compliance Jungle today. Click here!

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Visit us: http://www.complianceriskadvisor.com/

Complying With the ACA Is Making Me Feel Sick!

Another update from the HR jungle….

Marilyn is the HR director for her company. She’s spent a couple of years trying to figure out what the Affordable Care Act (ACA or Obamacare) means for her company. They have 80 employees so she knows they are a “large” employer and could be subject to the employer penalty if the employee group health plan doesn’t meet the minimum standards set in the ACA.

Trying to sort through the details of the ACA, while keeping up with her regular duties is making Marilyn feel sick. She knows that she has to track each employee’s weekly hours to verify who is eligible for the group health plan. Under the ACA, a full-time employee works an average of 30 hours a week.

She knows that the ACA allows employers to use two different counting methods to count employee hours. The counting methods are the Monthly Measurement Period and the Look Back Measurement Method but she isn’t sure which method to use.

What options are available to Marilyn?

1. She could read the IRS regulation explaining how to count each employee’s weekly hours using the Monthly Measurement Period and the Look Back Measurement Period.
2. She could ask for assistance from the insurance agency or broker that sold the group health plan to her company, assuming they provide such assistance.
3. She could hope that the employer penalty will be delayed yet again so that she has another year to figure out what to do.

Is your company struggling to understand how the ACA will affect the employee group health plan? Corporate Compliance Risk Advisor can help you grasp the basics of the ACA and how it affects an employer of your company’s size.

Join the HR Compliance Jungle today. Click here!

Follow us on Facebook & Twitter!

Visit us: http://www.complianceriskadvisor.com/