Tis the season for gift giving. But, know the rules for giving and receiving gifts before you commit an ethics violation.
I remember one young Marine gave our Commanding Officer and Executive Officer a day planner for Christmas. Within minutes, the First Sergeant was discreetly asking someone to search the regulations to see if they could accept the gifts. It is one thing to accept a cookie from the office baker but it another to accept a gift that may be considered by others as “sucking up.”
Below is an easy to read guide to keep you from making a faux pas depending on where you work.
Federal Government – gift giving between federal employees is subject to limitation.
Do NOT give gifts to your supervisors.
Do not accept gifts from subordinates or other federal employees who make less than you.
Do not ask employees to contribute toward a gift for an official superior.
Always be mindful of the possibility that others may view your gift giving as favoritism.
Be careful someone does not expect a promotion or special assignment because they gave you a gift.
The Exception to the rules – You may accept refreshments, greeting card, or small gift other than cash valued at less than $10 from an employee or coworker. Likewise, employees make accept a gift – not cash – from the public valued up to $20, if all gifts received do not total more than $50 in a calendar year.
Consult your Human Resource Department and employee handbook for guidance.
If gifts are allowed, find out to whom you can give a gift. Know the rules of your office.
Allow people to opt-out of the Secret Santa or gift exchange. Set a clear spending limit and let people know about it ahead of time.
If you receive a gift from a client know if you can keep it and if there are any stipulations on the value of the gift. If you cannot keep the gift due to company ethics policies consult your Human Resources Department on disposal of the gift. Most Human Resource Departments will provide you a list of non-profit organizations to donate the gift. Be sure to send a thank you note and explain the gift was donated. This will let the person know not to send you something in the future.
Consult your manager or Human Resources Department on whether it is appropriate to send a gift to a client.
Remember to be kind. If you know someone is struggling financially do NOT embarrass the person by singling him or her out and presenting them a gift card, cash, or food box containing a holiday meal in front of everyone.
Small Businesses – often treat their employees like family.
Ask your supervisor what is the proper protocol for gift giving.
Pool your spending power if you are buying a gift for the owners. Suggested contribution is $5-$10.
If it is a small office or workplace if you give to one co-worker you should give to all co-workers. Small businesses thrive on having a cohesive work environment. You do not want to make someone feel unwanted by not giving that person a gift.
Instead of buying gifts for everyone you may choose to bake a tray of cookies or your specialty item for everyone to enjoy at work or take home to share with their families.
Don’t let the holiday gift giving fever catch you unprepared. You do not want to get coal in your stocking. Know the ethical guidelines for gift giving for your place of employment.
Did you know that rules for paying overtime have changed? They changed on May 1st, 2016.
“The U.S. Department of Labor is expected to release a new overtime rule in May that could have a big impact on small business payrolls.” “The current weekly minimum for salaried, overtime-exempt employees is $455. That will increase to $921 a week for most full-time salaried workers when the rule changes this spring.” “Small employers may misclassify employees as exempt just because they receive a salary and perform non-manual work.´ read the full article at http://www.manta.com/resources/small-business-trends/small-biz-owners-not-aware-of-new-federal-overtime-rules-impact-on-payroll/
Remember you don’t have to pay for full time employees. You have options.
Stay within Budget 1099 Contractors – you may choose to use 1099 Independent Contractors. There are rules to follow if you use this classification for your help. They are not employees so technically you cannot dictate their schedule. They work when they want to and you contract with them for work when you have work to do. I’ve seen this used in the construction industry, real estate industry, and by many small business owners who do not need full-time employees. I’ve also seen this used by small business owners who did not want to pay the appropriate taxes or benefits as would be required by having employees. They prayed they didn’t get flagged for an audit and were prepared to play dumb if caught. I don’t condone this practice. At the end of the year you will need to issue the worker a 1099 if you pay them over a certain amount if you are following the rules. Consult a tax preparer or enrolled agent for guidance.
Free Lancers – there are several freelance websites where professional list their skills. You post the job and they bid on the job. The freelancer is typically charged a fee to bid on the job and/or when he or she wins the job a percentage of his earnings is paid to the agency. A freelancer is responsible for paying his or her own taxes. You do not need to issue a 1099 to a freelancer. Consult a tax preparer or enrolled agent for guidance.
Interns – summer interns or interns who work during your busy season can be a great boost to your business productivity. Most states require you to pay your interns at least minimum wage or a fair wage for the work performed.
Regardless of who is performing the work you need to stay within a budget. This can be accomplished by asking the employees how long they estimate a project will take to complete. This should be asked prior to preparing a proposal. When assigning work you need to let your employee know how long you expect him or her to spend on the task. If the task is going to take longer than anticipated they should let you know that it will take longer, how much longer and why. This allows you to pull the plug if going over budget or devise a new strategy.
Employees don’t often recognize the costs associated with making errors. Whether it is wasting copy paper and printer ink, boards, and other construction materials, or baking products they don’t see how this is costing the employer. They also fail to recognize they got paid to do the work wrong and then got paid to do it over. Training and supervising your employees can reduce the cost of mistakes. Mistakes can easily run up overtime costs.
Now is the time to take a look at how you pay your employees or workers. Make an appointment with your accountant or enrolled agent to explore what is the best option for you and your business. You won’t grow your business unless you focus on the net and stay abreast in changes to the rules, regulations, and laws.