Newsletter Header
Volume 19 | Issue 12 Source for Employer Empowerment December 2011
In This Issue
Paid Leave: A Valuable Benefit
Minimum Wage Increasing In Some States
New 401(K) Limits for 2012
Holiday Gifts & Possible Tax Implications
Safe Driving Tip
Cell Phones and Driving
Workplace Safety Tip
Personal Protective Equipment
RMI's New Employee

RMI would like to welcome Wade Miller as our new Client Relations Manager! Wade brings finance and HR experience from a non-profit and from a collection law firm. He received a B.S. degree in Business Management-Finance from Brigham Young University and an MBA from the University of Utah. Wade enjoys all sports, especially running, and has run fourteen marathons.

Upcoming RMI Holidays

RMI will be closed on the following dates in observance of the upcoming holidays:

Christmas: Monday, December 26, 2011
New Year's Day: Monday, January 2, 2011

Paid Leave: A Valuable Benefit

Paid leave is a benefit that is commonly offered in some form at many companies and has weathered the recession virtually unchanged according to a 2011 Employee Benefits report by the Society for Human Resource Management (SHRM). In other words, as companies have responded to the recession by cutting insurance plans, wages, hours, and positions, paid leave benefits have remained relatively untouched. This is particularly interesting when, according to the same SHRM report, paid leave benefits are second only to insurance plans in the amount of money an employer spends on benefits for its employees. As such, what makes paid leave benefits so valuable as to be practically recession proof; what options are out there; and how can RMI help you manage it?

Paid leave is an important and valuable benefit because it keeps your employees happy and keeps you competitive. This is most notable in terms of retention; taking leave reduces burn-out which reduces voluntary turnover. Additionally, taking vacations or just time away from work can lead employees to become more productive and more creative. Consider a few statistics:

  • In an Accountemps survey, 51% of executives indicated that employees are more productive after a vacation.
  • A World at Work (WAW) study found that 76% of employers feel it's necessary to offer paid leave to be competitive.
  • The same WAW study also showed paid leave to be an important recruiting tool: 60-70% of employers actively market paid leave to attract candidates. This may be due to a greater number of employees, especially younger employees, who are seeking more flexibility at work so that they can manage their personal lives as well as their work lives. In fact, most employees now rank flexibility as the second or third most important part of their "total rewards" (pay and benefits) package.

Employers can offer paid leave in various forms and have options as to how it is given to employees. Most employers offer some combination of paid holidays, vacation, sick time, or simply paid time off (PTO, which can be used for either sick or vacation time). Recently, PTO has gained popularity as more employers are moving from a traditional system of sick and vacation time to a PTO system. The WAW study reveals that a majority of companies on a PTO system are seeing it as good for morale and have reported that it has reduced absenteeism. Regardless of whether you offer a traditional system or a PTO system for paid leave, there are options on how it is given to employees. Some employers choose to accrue the paid leave balance over a period of time, typically per pay period. Others favor an award of the entire balance on an on annual basis, which may be on the employee's anniversary date or follow a calendar year. Your RMI HR Representative or RMI Payroll Manager can assist you in determining what is appropriate for your circumstances.

Additionally, some employers will offer other paid leave benefits. This may include pay for time missed due to jury duty. Usually, jury duty benefits have a cap on what is paid. For example, the employer will pay for up to three days of jury duty. Bereavement pay is another common type of paid leave whereby the employer may pay the employee for a couple days while they mourn the loss of a family member. Not only is bereavement pay appreciated by the employee, but most employees won't be very productive during periods of mourning. There are also a number of less common types of paid leave that some employers offer including personal leave, floating holidays, paid maternity or paternity leave, or paid military leave. To update or change what you are currently offering to your employees, please contact your RMI HR Representative.

With any paid leave policy, it is important to note whether or not an employee's leave balance will be paid out upon separation of employment. Federal law does not require any leave balances to be paid out, but some states do have special requirements. For example, states such as California, Montana, and Wyoming require earned vacation balances to be paid out upon termination, whereas other states such as Utah and Washington do not require it to be paid unless it is specified in the company's policy. For specific requirements in states where you have employees, please contact your RMI HR Representative.

No matter what type of paid leave you offer, RMI can help you effectively manage this valuable benefit. We can write paid leave policies, track leave balances, and ensure compliance with applicable laws. For additional information about paid leave or for help with designing or revising a paid leave policy for your company, please contact your RMI HR Representative.

Back to Top
Minimum Wage Increasing In Some States

With 2012 quickly approaching, it is important to be aware that several states are increasing their minimum wage on January 1, 2012. The current federal minimum wage is $7.25 per hour, which may be higher or lower than some states' or local governments' minimum wage. Whichever wage is higher is the minimum wage that is required to be paid. The following table indicates the current state minimum wages and upcoming changes announced to date:

State Current Hourly Minimum Wage Future Hourly Minimum Wage
Alabama No State-Mandated Minimum Wage
Alaska $7.75 No Change
Arizona $7.35 $7.65, effective 1/1/12
Arkansas $6.25 No Change
California $8.00 No Change
Colorado $7.36 $7.64, proposed increase for 1/1/12
Connecticut $8.25 No Change
Delaware $7.25 No Change
District of Columbia $8.25 No Change
Florida $7.31 $7.67, effective 1/1/12
Georgia $5.15 No Change
Hawaii $7.25 No Change
Idaho $7.25 No Change
Illinois $8.25 No Change
Indiana $7.25 No Change
Iowa $7.25 No Change
Kansas $7.25 No Change
Kentucky $7.25 No Change
Louisiana No State-Mandated Minimum Wage
Maine $7.50 No Change
Maryland $7.25 No Change
Massachusetts $8.00 No Change
Michigan $7.40 No Change
Minnesota $6.15 (Exceptions Apply) No Change
Mississippi No State-Mandated Minimum Wage
Missouri $7.25 No Change
Montana $7.35 (Exceptions Apply) $7.65, effective 1/1/12
Nebraska $7.25 No Change
Nevada $7.25 (Exceptions Apply) No Change
New Hampshire $7.25 No Change
New Jersey $7.25 No Change
New Mexico $7.50 No Change
New York $7.25 No Change
North Carolina $7.25 No Change
North Dakota $7.25 No Change
Ohio $7.40 (Exceptions Apply) $7.70, effective 1/1/12
Oklahoma $7.25 (Exceptions Apply) No Change
Oregon $8.50 $8.80, effective 1/1/12
Pennsylvania $7.25 No Change
Puerto Rico $7.25 (Exceptions Apply) No Change
Rhode Island $7.40 No Change
South Carolina No State-Mandated Minimum Wage
South Dakota $7.25 No Change
Tennessee No State-Mandated Minimum Wage
Texas $7.25 No Change
Utah $7.25 No Change
Vermont $8.15 $8.46, effective 1/1/12
Virginia $7.25 No Change
Washington $8.67 $9.04, effective 1/1/12
West Virginia $7.25 No Change
Wisconsin $7.25 No Change
Wyoming $5.15 No Change

For more information on minimum wage, please contact your RMI HR Representative or Payroll Manager.

Back to Top
New 401(K) Limits for 2012

The 2012 limit for employee elective deferrals for 401(k)-type plans, Section 403(b) plans, and Section 457 plans will be increased to $17,000, up from the 2011 limit of $16,500. The "catch-up" provision will remain an additional $5,500. The "catch-up" provision applies to employees who have reached age 50, or who will turn age 50 any time during the calendar year. The "catch-up" provision allows those who qualify to defer up to $22,500 per calendar year.

Employees can make changes to their deferral amounts the first day of any month. Please contact RMI's Benefits Department at (888) 764-0200 if you would like to change your deferral amount for January 1st. If you participate in a non-safe-harbor 401(k) plan, and are considered a highly-compensated employee or are an owner, you will want to discuss any deferral changes with Jere El-Bakri from Retirement Plan Consultants at (800) 948-0330 before submitting your form.

If you have any questions concerning your current deferral amount, your employer's matching contributions, or any other 401(k) related questions, please contact either RMI's Benefits Department or Jere El-Bakri.

Back to Top
Holiday Gifts & Possible Tax Implications

If you are planning on gifting employees with cash during the holiday season, don't forget to report these gifts as taxable income on your December payroll. Any cash gift, including a gift certificate that an employee could covert to cash, is subject to employment taxes and should be reported on the employee's 2011 Form W-2.

If you'd like to give cash bonuses but do not want your employees to suffer any tax implications, you can cover the cost of taxes for your employees by instructing your RMI payroll manager to "gross-up" the cash gift. The additional income that you pay in gross wages will be used to cover the employee's taxes so that the employee's net income is not affected by the taxable gift.

Gift certificates are only considered taxable income if they are redeemable for cash. Non-cash gifts of nominal value, such as a turkey or ham, are nontaxable.

If you have questions regarding how to report a taxable gift on payroll, please contact your RMI Payroll Manager at (888) 764-0200.

Back to Top
Safe Driving Tip
Cell Phones and Driving

What's at Stake?
We've all seen one or been one. We're talking about that distracted driver, one hand on the steering wheel and the other on the phone, with the job of driving safely clearly far from his mind. Cell phone use has escalated considerably in the past decade and so have the number of phone-related traffic fatalities and the number of jurisdictions enacting laws that prohibit or restrict cell phone use. Many companies are following suit by introducing policies that prohibit or limit a worker's cell phone use while driving.

What's the Danger?
Studies suggest driving while on a cell phone can be as dangerous as driving drunk. Not convinced? Try following drivers who are talking on the phone. Are they driving inconsistently, speeding up one minute and then slowing down the next? Do they change lanes unexpectedly or have difficulty staying in their own lane? Those are all telltale signs that a driver is distracted by a cell phone.

A study conducted by the National Safety Council found cell phone users missed twice as many simulated traffic signals as drivers who weren't on the phone. This included drivers using a hands-free device, something researchers say is only slightly safer than using a hand-held phone.

Cell phones have not increased productivity to the extent that some might suggest. One company surveyed employees a year after introducing a cell phone ban and found 95 percent reported no lost productivity.

Example
In June 2007, five teens were killed when their car swerved into oncoming traffic and collided with a truck. The investigation revealed that the driver's cell phone was being used to make calls and send text messages at the time of the crash.

How to Protect Yourself

  • Don't use a cell phone if you are a new driver or are getting accustomed to a new car. Master the most important skills first.
  • Pull over to the side of the road to take or make calls, including calls to 9-1-1.
  • Review your company's cell phone policy and abide by it when driving or operating machinery and equipment including forklifts and backhoes.
  • Familiarize yourself with any motor vehicle laws pertaining to cell phones, especially when traveling out of state or province
  • Limit phone use to when you are parked or ask a passenger to make calls for you.
  • Use a hands-free headset and keep calls brief. Talking while driving is always a distraction that is best avoided.
  • Don't take notes or look up phone numbers while driving. Ask the caller to leave details on your voicemail.
  • Get to know your phone and its features so you know where the buttons are.
  • Keep your phone within easy reach so you don't have to take your eyes off the road.
  • Don't make or take calls during heavy traffic or severe weather.
  • Never have stressful or emotional conversations while driving.
  • Keep conversations brief. Let the person know you are driving and must hang up as soon as possible.

Final Word
Cell phones have made our roads and highways both safer and more dangerous than ever before. Make a conscious effort to restrict, or eliminate, cell phone use while driving. It could mean the difference between life and death.

To revise your company cell phone policy, please contact your RMI HR Representative.

Back to Top
Workplace Safety Tip
Personal Protective Equipment

Personal Protective Equipment (PPE) is equipment that is designed to protect the wearer from injury. When engineering, work practice and administrative controls are not feasible or do not provide sufficient protection, employers must provide PPE to their employees and ensure its use. OSHA standards 29 CFR 1910.132 and 29 CFR 1926.28 cover the use and maintenance of PPE for the eyes, face, head and extremities when necessary because of process or environmental hazards. Effective February 13, 2008, OSHA requires employers to provide their employees with no-cost protective equipment (OSHA1910.132(h)(2)). The employer is not required to pay for non-specialty safety-toe protective footwear (including steel-toe shoes or steel-toe boots) and non-specialty prescription safety eyewear, provided that the employer permits such items to be worn off the jobsite.

PPE includes protective clothing, respiratory devices and protective shields/barriers. Some examples are:

  • Safety glasses, goggles and face shields;
  • Earplugs/earmuffs;
  • Hard hats/bump caps;
  • Leather/rubber gloves/insulated mesh gloves;
  • Safety shoes/boots;
  • Personal fall-arrest systems;
  • Full body suits; and
  • Respirators/self-contained breathing apparatus (SCBA).

Proper PPE selection includes:

  • Determining and identifying types and degrees of workplace hazards.
  • Ensuring PPE meets or exceeds appropriate standards.
  • Purchasing different sizes and styles to fit all users.
  • Verifying user fit and leak testing.
  • Explaining company PPE programs including the cost of purchasing, maintaining and replacing PPE.
  • Providing training regarding PPE design and limitations.
  • Explaining what to do in an emergency.
  • Explaining when and how to wear, adjust, use, clean, sanitize, maintain, store and dispose of PPE.

Key elements of an effective PPE program include:

  • Identify and evaluate workplace hazards using a written assessment.
  • Use engineering controls when possible.
  • Establish PPE policies and rules.
  • Select the proper types of PPE, providing choices when possible.
  • Set a positive example by wearing PPE.
  • Discuss employee reluctance to wear PPE.
  • Establish fair rules and enforce uniformly.
  • Purchase and supply PPE to employees.
  • Use medical evaluations and surveillance.
  • Train PPE users.
  • Inspect and maintain PPE.
  • Clean and properly store PPE.

Typical OSHA PPE citations have included failure to:

  • Assess the workplace to determine if hazards that necessitate the proper selection and use of PPE were present or were likely to be present.
  • Verify through a written certification that that the required workplace hazard assessment for PPE has been performed.
  • Provide training to each employee required to use PPE.

For more information about PPE, please contact your RMI HR Representative.

To access the online Workplace Safety Training Log click here.
Back to Top
Copyright © 2011 Resource Management, Inc. All rights reserved.
Client & Employee Newsletter, Source for Empowerment is published monthly by Resource Management, Inc. Client & Employee Newsletter features issues of importance to our clients and their employees. It is intended to provide general information and should not be construed as legal advice. We welcome your comments, questions, and concerns.
Napeo Logo
Toll Free: (888) 764-0200 | 510 South 200 West, Salt Lake City, UT 84101
www.rminc.com