HCM Insights August 2020

HCM Insights August 2020

Holiday Reminder

LaborDay

The American workforce has faced uncharted waters this year, yet we continue to persevere. In the coming weeks, we will celebrate Labor Day, which is a day set aside to honor the contributions of our workforce. This year Labor Day brings with it a new significance as we put aside the challenges of the year and look forward, with anticipation, to the days ahead.
In observance of Labor Day, CBIZ HCM offices will be closed on Monday, September 7, 2020. Labor Day is a Federal Reserve Bank Holiday, which means payroll draft dates will need to be adjusted. We recommend processing payroll at least three business days prior to the check date during this time.

Important Payroll Deadlines

Check Date Check Processing Date
Tuesday, September 8, 2020 Wednesday, September 2, 2020
Wednesday, September 9, 2020 Thursday, September 3, 2020

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Weather Preparedness

hurricane

As it is shaping up to be a busy hurricane season, we want to make sure you know CBIZ is here to help. 

If you realize you are in a potentially affected area, we invite you to contact us to discuss how we may be of assistance. As there is always the likelihood that the storms can cause shipping delays, we stand ready to assist you should you wish to process payroll a few days early. Also, if your area is impacted by a storm, and you have questions about the status of your most recent payroll, please do not hesitate to reach out to us.

 

With CBIZ offices located in several areas of the country, we are continually ready and available to help you prepare for changing weather conditions. If you currently receive a physical payroll package from CBIZ and are interested in paperless options, please reach out to your payroll service team to discuss.  As always, your CBIZ HCM Team is here should you have any questions.

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Do You Qualify for the Employee Retention Credit?

employees

The introduction of the Employee Retention Credit came as part of the CARES Act. This credit may be taken in advance against certain employment taxes. It is important to remember that qualifying to receive the retention credit is determined every quarter.


Who is Eligible

According to IRS.gov, employers, including tax-exempt organizations, are eligible for the credit if they operate a trade or business during the calendar year 2020 and experience either: 

  • Full or partial suspension of operation during any calendar quarter in 2020 due to orders from an appropriate governmental authority limiting commerce, travel, or group meetings (for commercial, social, religious, or other purposes) due to COVID-19; or
  • Experience a significant decline in gross receipts.

Significant Decline in Gross Receipts

The IRS likewise provides further clarification on determining the significant decline in gross receipts.  The significant decline in gross receipts begins on the first day of the first calendar quarter of 2020 for which an employer’s gross receipts are less than 50% of its gross receipts for the same calendar quarter in 2019.  The significant decline in gross receipts ends on the first day of the first calendar quarter following the calendar quarter in which gross receipts are more than of 80% of its gross receipts for the same calendar quarter in 2019.

The credit applies to qualified wages (including certain health plan expenses) paid during this period or any calendar quarter in which operations were suspended.

More Information

For more detailed information and answers to frequently asked questions, please visit IRS.gov

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Fiscal Unemployment Insurance Rates

Rates

Fiscal Unemployment Insurance (UI) rates were recently released. State unemployment tax agencies in New Jersey, Tennessee, New Hampshire, and Vermont began mailing fiscal UI tax rates to employers in July. We request that you forward this information to the CBIZ Tax Department via email, fax, or regular mail service. 

Contact Information

Email
cbizpayrolltax@cbiz.com

Fax
540-343-5279

Mailing Address
2797 Frontage Road NW
Suite 2000
Roanoke, VA 24017

Minimum Wage Updates

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As of July 1, 2020, minimum wage changes took place in The District of Columbia, Illinois, Nevada, and Oregon.  Likewise, the white-collar threshold was adjusted in Colorado and Washington. Looking forward, on September 1, 2020, there will be a minimum wage rate change in Connecticut. Visit The Department of Labor website to view a state resource map with minimum wage laws.

 

 

Minimum Wage Change Effective January 1, 2021

State 2020 Minimum Wage 2021 Minimum Wage Tipped  Employees
      Minimum Cash Wage Based on Maximum Credit of 
Alaska $10.19 $10.34 Not Allowed Not Allowed
Arizona $12.00 $12.15 $9.15 (up from $9.00) $3.00*
Arkansas $10.00 $11.00 $2.63* $8.37 (up from $7.37)
California

Greater than 26 Employees $13.00

Fewer than 26 Employees $12.00

$14.00

$13.00

Not Allowed Not Allowed
Colorado $12.00 $12.32 $9.30 (up from$8.98) $3.02*
Florida $8.56 $8.65 $5.63 (up from $5.54) $3.02*
Illinois $10.00 $11.00 $6.60 (up from $6.00) $4.40 (up from $4.00)
Maine $12.00 $12.15 $6.08 (up from $6.00) $6.08 (up from $6.00)
Maryland

At least 15 employees $11.00

No more than 14 employees $11.00

$11.75

$11.60

$3.63*

$3.63*

$8.12 (up from $7.37)

$7.97 (up from $7.37)

Massachusetts $12.75 $13.50 $5.55 (up from 4.95) $7.80*
Michigan $9.65 $9.87** $3.75 (up from $3.67) $6.12 (up from $5.98)
Minnesota

Large Employers $10.00

Small Employers $8.15

$10.08

$8.21

Not Allowed Not Allowed
Missouri $9.45 $10.30 $5.15 (up from $4.725) $5.15 (up from $4.725)
Montana $8.65 $8.75 Not Allowed Not Allowed
New Jersey

General 

Seasonal employers & employers with no more than 5 employees 

Agricultural employers

 

$11.00  

$10.30

$10.30

 

$12.00

$11.10

$10.30

 

$3.13*

$3.13*

$3.13*

$8.87 (up from $7.87)

$7.87 (up from $7.17)

$7.87 (up from $7.17)

* Indicated No Change

**Except suspended if for 2020 the unemployment rate is at least 8.5%

District of Columbia
  • Hourly minimum wage: $15.00 (up from $14.00)
  • Tipped Employee hourly minimum: $5.00 (up from $4.45) based on a tip credit increases from $9.55 to $10.00
Illinois
  • Hourly minimum wage: $10.00 (up from $9.25)
  • Tipped Employee hourly minimum: $6.00 (up from $5.55) based on a tip credit increase from $3.70 to $4.00
  • Workers younger than 18 who work less than 650 hours in a year are to be paid $8.00 per hour.
Nevada
  • Hourly minimum wage: $9.00 (up from $8.25)
  • Hourly minimum wage if qualifying health benefits are offered: $8.00 (up from $7.25)
Oregon
  • Standard state hourly minimum wage: $12.00 (up from $11.25)
  • Portland-area hourly minimum wage: $13.25 (up from $12.50)
  • Nonurban counties’ hourly minimum wage: $11.50 (up from $11.00)
  • The hourly subminimum wage that may be paid to workers with disabilities is to be at least $9.25. The subminimum wage is to phase out by 2023.

Minimum Wage Change Effective September 1, 2020

 Connecticut
  • Hourly minimum wage: $12.00 (up from $11.00)
  • Tip employee maximum credit for wait staff: $5.62 (up from $4.62)
  • Tip employee maximum credit for bartenders: $3.77 (up from $2.77)

White-Collar Threshold

In July two states increased the minimum salary threshold requirements for white-collar executive, supervisory, and professional employees to be exempt from overtime requirements.

Colorado
  • Minimum white-collar salary threshold: $684 a week ($35,568 annually)
  • This equals the federal white-collar salary threshold that took effect on January 1, 2020.
  • New overtime-exempt salaries are to be covered by state wage and hour protections as of July 1, 2020, unless specifically excluded.
Washington
  • Minimum white-collar salary threshold: $675 a week
  • This is 1.25 times the state’s minimum wage and took effect on July 1, 2020, under the final rules that were issued on December. 11, 2019.

 

 

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The information contained in this HCM Insights is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations. This information is provided as general guidance and may be affected by changes in law or regulation. This information is not intended to replace or substitute for accounting or other professional advice. You must consult your own attorney or tax advisor for assistance in specific situations. This information is provided as-is, with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.