After calculating gross wages for an employee is accomplished, much more difficult decisions have to be made. What must an employer deduct from an employee’s wages? What can be deducted legally? What can never be deducted? These questions and more must be answered correctly before processing that paycheck. And if this is the employee’s final check, the rules may change! Handling deductions is a complex task that payroll must get right every time for every payroll check. Failure to deduct the proper taxes could result in penalties on the employer from the IRS, but making an illegal deduction for a fringe benefit or for collecting an overpayment can get the employer a visit from the federal department of labor auditor, the state department of labor auditor or both! Sometimes the federal government will allow the deduction but the state won’t. Of course everyone knows that payroll deducts for federal and state taxes. However, how much input does the employee have concerning these deductions?
Many employers require their employees to wear uniforms for work. Can the cost of the uniforms and their upkeep be deducted from an employee’s wages? What about cash shortages or breakage? Can you deduct the cost of shortage or breakage from the employee’s paycheck under the state or federal laws? Some employers offer meals and lodging as part of the employee’s work contract. What can be deducted from the employee’s paycheck for employer provided meals and lodging and can this be used as credit against the minimum wage paid? What if an employee is overpaid, can the employer simply deduct the overpayment from future payments or does the employee have to agree to the deduction in writing? Does the federal law differ from the state law in this area and, if it does, which one does the employer have to follow?
Many employers advance vacation for their employees to ensure that all employees are rested and working at peak efficiency. But what if the employee takes their vacation in advance and then leaves the company? Can an employer recoup advanced vacation hours from the employee’s final check under federal or state laws?
You will get answers to all these questions and more by attending this session by expert speaker Vicki M. Lambert. Vicki will explain which taxes are mandatory, which are a courtesy and which ones the employee controls. If the IRS or the state wants payroll to collect for back taxes; you will learn how it should be processed. Vicki will answer the question of what payroll should do if a “payday loan” deduction is received as opposed to a creditor garnishment? You will learn which ones must be honored and why.
Fringe benefits are a normal part of payroll for most employees. Deducting for voluntary fringe benefits such as health insurance or group term life can usually be an easy task. But what about health insurance under a medical support order? Does that change how it is processed by payroll? Vicki will discuss processing voluntary and involuntary health insurance deductions.
Many employers give loans, advances on wages to employees or allow employees to purchase items from the employer. Vicki will discuss how these can be recouped or repaid if the employee stays or if the employee terminates.
Who Should Attend
Vicki M. Lambert, CPP, is President and Academic Director of The Payroll Advisor™, a firm specializing in payroll education and training. The company’s website www.thepayrolladvisor.com offers a payroll news service which keeps payroll professionals up-to-date on the latest rules and regulations.