Happy Halloween!

The holidays are beginning. That said I am going to jump right in with some
very useful information that will help you answer a typical employee question,
" Do we get Friday off?"

As Thanksgiving approaches, you'll begin to hear employees ask this question. And – since Christmas falls on Tuesday this year – they also want to know if they'll get Monday (Christmas Eve) or Wednesday (Boxing Day) off too.

Generally, private (non-government) employers are free to pick which "special days" they'll honor as holidays by closing the business. Although employers often choose the federal holidays, your organization may also celebrate other occasions (perhaps your CEO's birthday?) with a special day off.

Plus, employers may choose which holiday benefits to give – and who gets them. For example, you could give full-time employees a paid day off for Thanksgiving, but let temp and part-time workers only get an unpaid day off.

Which of the federal holidays are mandatory?
Answer is None. All holidays are discretionary with the employer. There is no law that requires an employer to observe any "holiday" and no law that requires employers to grant holidays with pay.

Can you exclude some workers from getting paid holidays?
Answer is Yes – you can exclude part-time and temporary employees from paid holidays. You can even designate exempt employees only as eligible. However, be aware that holidays can be a retention tool, so to exclude a certain class of employees could result in loss of those employees to employers who don't exclude any class of employee.

What should you consider before closing for an extra day (or for the entire week of Christmas or Thanksgiving)?
Answer –exempt employees cannot have their salaries reduced for absences or shutdowns except under certain circumstances. You can require employees to take vacation during long shutdowns such as week of Christmas but you must give them adequate notice.

When do you pay employees if your company closes for additional days around the holidays?
Answer - If an employer is closed on a payday that falls on a Sunday or holiday listed in the US Code, the employer is permitted to pay wages on the next business day. Of course, paying the day before the holiday is acceptable, as well.

If you close for a few days during a week, can you reduce exempt employees' salaries proportionately?
Answer is No -- there are only certain circumstances which permit employers to reduce exempt employees' salaries. When exempt employees work any portion of a workweek, they must be paid for the entire week. This requirement did not change under the new federal overtime regulations.

© LawRoom – adapted by Margaret Jacoby, PHR.

Now for our monthly mini quiz:
What is the maximum amount of earnings subject to the Social Security tax
(taxable minimum) in 2008?
 

A) $88,900   B) $94,200   C) $97,500   D) $102,000 The correct answer can be found at the end of our newsletter.

This month's newsletter covers California's new military spouse leave
law and some tips on managing this weekend's change to standard time!

Now, enjoy!

Most people are happy to gain an hour's sleep when we go from daylight saving back to standard time on November 4. But HR managers have to brace for a double hassle.

Come 2 a.m., Sunday morning, sleep an extra hour, everyone, unless you work the night shift. Then you'll probably have to work an extra hour. And if you're in HR, you've got more than an extra hour's worth of work to do.

While Hawaii and most of Arizona do not observe daylight saving time, HR managers in all other states have two time change hassles to deal with:

1. First, there's the issue of how your payroll system is going to handle the extra hour
2. There are all the other systems, contacts, and arrangements to be checked, verified, and notified.

Notify Your Employees

First, make sure your employees know how you're going to handle the extra hour on November 4. Will the night shift work an additional hour? Or will they work their normal hours and then stop? If they do stop, is any special coverage needed? What about phone, security, reception, maintenance?

If nonexempt employees work the extra hour, be sure they get paid for it and that it counts as an hour worked for overtime calculation purposes. Those aren't our rules, they're the government's rules.

If you want to avoid paying overtime for the ninth hour in an 8-hour shift because it kicks your workweek over the 40-hour mark, consider adjusting employees' schedules on another day. (Unless you are in California that requires overtime after 8 hours in a day - then you'll have to pay.) If you are a public employer, you may consider a comp time arrangement.
 
For any of these pay scenarios, the important thing is to make sure employees know what is happening - employees don't like surprises in their paychecks.

Check Out Your Payroll and Relates Systems

Payroll systems are notoriously reluctant to pay for a 25-hour day. So, before the time change occurs, check with your payroll people to see how your system is going to handle the extra hour, and find out precisely how your supervisors should report the extra hour - it probably has to go in under a special code.

Do you use a payroll processor like Paychex or ADP? The big outfits have naturally thought this issue through, but you still need to check with them about how to report.

What other systems affect payroll operations? Make sure that your scheduling software, time clocks, and other similar software and hardware are ready for the extra hour.
 

Too Early To Think About March?

Things get a little trickier in March, when clocks get set ahead. Most employees will want to get their full 8-hour shift in, although some will welcome a "mini-vacation" of an hour.
 
Many organizations pay for 8 hours even though employees have only worked for 7. This is fine, but, again, you have to work through the reporting carefully. And remember, if you do pay the missing hour, it does not count for overtime calculation purposes, because it is not an "hour worked" under the FLSA.
 
It's also worth checking out meeting scheduling and calendar software, and any other systems that log dates and times, including fax machines, security systems and backup programs.
 
Remember to make the same check in March when an hour is lost. In 2008, daylight saving time begins on March 9 and ends on November 2.
 
Copyright ©2007 BLR Business & Legal Reports.

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Answer To Mini Quiz:
$102,000

Explanation:
The Social Security Administration recently announced that the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase from $97,500 in 2007 to $102,000 in 2008. Of the estimated 164 million workers who will pay Social Security taxes in 2008, nearly 12 million will pay higher taxes as a result of the increase in the taxable maximum.