Archive for Employees and Benefits

Healthcare Premium W-2 Reporting

Starting in 2013, employers with fewer than 250 employees must report healthcare premium benefits on employee W-2s. If you provide healthcare coverage benefits for employees, you’ll need to provide your payroll provider with the information or make certain that your in-house W-2 preparation includes it at the end of the year.

A requirement of the Affordable Healthcare Act (ACA) this requirement went into effect in 2011, but employers with fewer than 250 employees had a reporting exception until now.

No Tax Impact for Employees

This is informational reporting only. Generally, the amount reported should be the total cost, both employer paid portion and the employee’s contribution amount. It will not increase an employee’s taxes but it will reinforce the cost of the healthcare benefits you provide for them.

Additional Healthcare Premium Reporting Information

If you are using an outside payroll service, they should be able to advise you about how and what to report. If you do it yourself or need additional information, there is a Frequently Asked Questions page on the IRS site.


Take Credit for Employee Benefits

the word benefits spelled outEmployees want to work for employers with benefits, so you try your best to provide them. The curious thing is, that while they are very important to employees and quite costly for employers, the expense of providing them are often underappreciated by staff.

One way to reinforce that it is a significant value added to an employee’s pay package is to recap your benefits and their costs at the end of the year. Once they’ve signed up, many staff members register benefits more as a payroll deduction, than as an important part of their total compensation. So it’s good to reinforce the costs involved for you, as an employer.

Consider enclosing a note with employees’ W-2s this year, detailing their benefit costs. As an alternative, make it part of your annual staff evaluation and salary negotiation process.

And don’t forget to add in all those payroll taxes you pay; in addition to health insurance, retirement plans, and other benefits, you are also contributing to Social Security & Medicare for every employee. The combination of benefits and employment taxes can add a significant percentage to your total payroll costs.


Hiring Summer Interns

Smiling group of students in a librarySummer is almost here and one great way to get some help for your business is using summer interns.  With the job market still weak, many college and high school students are seeking internships for school credit or work experience. Even though most large company internships are already filled, there is still an opportunity for small businesses to find interns because many motivated students are still unemployed for the summer due to a lack of available jobs.
When the internship position is structured well, both the business and the intern can gain great value.  Internships work best when the position description is well thought out and holds some interest for the intern. An engaged intern will give you more value than one who is relegated to seemingly menial and meaningless tasks, so explaining how their work supports the business helps — and a little mentoring can go a long way.
Intern programs are great feeders for hiring staff later, so it’s also a cost-effective recruitment tool for small businesses.  One caveat: interns in businesses are actually employees so follow the appropriate labor laws.  Just because someone is an intern, it doesn’t mean they can be used as unpaid staff.  State and federal wage and labor rules apply so check out both before hiring an intern. College credit and the value of “educational experience” can be an offset in some circumstances, but do your due diligence so that you don’t unintentionally flout the labor laws.