Follow the Laws
Labor Laws | Records and Accounting | Taxes
This section tackles some of the less-than-enjoyable aspects of business ownership: taxes, recordkeeping and employment issues. If you choose to handle these tasks yourself — or even if you outsource them to others — being familiar with the basics will help you stay ahead of regulations and be a more effective manager.
Federal Labor Laws
Employment Eligibility Verification Within three days of being hired, each new employee must complete Form I-9 from the Department of Homeland Security, U.S. Citizenship and Immigration Services, to verify his/her identity and eligibility to work in the United States. Download the form, instructions and a list of acceptable documents at www.uscis.gov.
The Fair Labor Standards Act applies to nearly all businesses in the U.S. and requires companies to pay at least the federal minimum wage ($7.25 per hour) and overtime pay of not less than one-and-one-half times the regular pay rate after 40 hours of work per week; prohibits persons under age 18 from working in certain jobs; and establishes the hours/times employees under age 16 may work. Some employees are exempt from one or more of the major requirements; consult the U.S. Department of Labor (www.dol.gov) for details.
Occupational Safety and Health laws require businesses to provide a safe workplace and, in many cases, to maintain records of job-related injuries and illnesses. Employers with 10 or fewer employees are exempt from most requirements, as are industries classified as low-hazard. Fines and penalties may be levied for non-compliance. Details are available from the U.S. Occupational Safety and Health Administration at www.osha.gov.
The Americans with Disabilities Act prohibits employment discrimination against qualified individuals with disabilities and requires that public accommodations and commercial facilities be designed to comply with specified accessibility standards. All businesses offering access to customers and/or employing 15 or more workers must abide by ADA rules. Visit www.ada.gov for details and to get a copy of the “ADA Guide for Small Businesses.”
Family and Medical Leave Businesses employing 50 or more must give certain employees up to 12 weeks of unpaid, job-protected leave per year (26 weeks for qualifying military caregivers) while preserving their health benefits during the period. Employees may take leave for the birth of a child; if they adopt a child or provide foster care; to care for a seriously ill spouse, child or parent; or if they personally suffer a serious health condition.
The U.S. Equal Employment Opportunity Commission enforces federal employment discrimination laws that protect civil rights and prohibit age discrimination.
The Equal Pay Act applies to virtually all employers and prohibits wage discrimination between men and women performing substantially equal work within the same workplace.
The Affordable Care Act specifies that all employers who provide self-insured health coverage to their employees must file an annual return with the IRS detailing certain information for each employee they cover. Employers with fewer than 25 full-time employees may be eligible for a Small Business Health Care Tax Credit to help cover the cost of providing coverage; those with 50 or fewer employees may be eligible to purchase coverage through the Small Business Health Options Program. Employers with 50 or more full-time employees must report if and what health insurance they offered employees and are subject to Employee Shared Responsibility provisions. Learn more about reporting requirements and eligibility for tax credits at www.healthcare.gov or www.irs.gov/Affordable-Care-Act/Employers.
State Labor Laws
New Hires Employers are required to complete a New Hire Reporting Form for every newly hired or rehired employee, full- or part-time, within 20 days.
Minimum Wage The 2016 Florida minimum wage is $8.05 per hour; tipped employees who meet the eligibility requirements of the federal Fair Labor Standards Act receive $5.03 per hour in addition to tips.
Workers’ Compensation Employers with four or more employees (full- or part-time) must carry workers’ compensation coverage for their employees. Different requirements apply for construction and agriculture.
Child Labor Workers under the age of 18 cannot work in hazardous occupations such as excavation, electrical work, roofing, mining, operating heavy machinery or moving vehicles, or around explosives, toxic or radioactive substances or dangerous equipment. Additional occupations are banned for children ages 14 and 15. Minors cannot work during school hours without an exemption.
Background Checks Private citizens or companies may request a state-only criminal history record check of an individual through the Florida Department of Law Enforcement website for a fee of $24 per case.
How to Get Your Free EIN
Before tackling the nitty-gritty details of which taxes impact your business, you should determine if you need to apply for an Employer Identification Number (EIN). For the answer, go to www.irs.gov/businesses/small and click on the “Employer ID Numbers” link. If you are operating as a sole proprietor and do not intend to have employees, your Social Security number will suffice; otherwise, you will need an EIN. Applying for an EIN is a free service offered by the IRS; avoid websites that want to charge.
Stay Up to Date
Federal tax laws are not only complex and confusing, they often change from one year to the next. For an up-to-date guide to the latest deductions you don’t want to miss, click on www.nfib.com/taxhelp.