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Home > What's New > Payroll Library Summary of Changes (current month)
Payroll Library Summary of Changes June 2007
111 — FEDERAL TAX COMPUTATIONS
125 — INTERNATIONAL PAYROLL
141 — WAGE-HOUR LAWS & RULES
- California Meal and Rest Breaks —The California Supreme Court has ruled that the additional hour of compensation required for failure to provide breaks is a form of wages and therefore subject to a three-year statute of limitations.
- Idaho Minimum Wage—The state minimum wage will conform to, and track with, the federal minimum wage, effective July 1, 2007. Currently the tip credit is 35 percent of the minimum wage; however, on July 1 that percentage is repealed and employers will be required to pay tipped employees wages of at least $3.35 per hour. Employers will be required to make up the difference if tips plus wages do not equal the state minimum wage.
- Indiana Minimum Wage—Employers that have two or more employees must pay at least the federal minimum wage, effective July 1, 2007, under a bill (H.B. 1027) signed by Gov. Mitch Daniels (R). Therefore, the state's minimum wage will automatically increase if the federal rate increases. The state's training wage, currently $4.25 per hour, also will increase if the federal rate increases.
- Maryland Minimum Wage—Effective Oct. 1, 2007, certain state contractors and subcontracts must pay employees a "living wage" of $11.30 per hour in the Baltimore-Washington, D.C., corridor and $8.50 per hour in the remainder of the state.
- Nevada Minimum Wage—The governor has announced that the minimum wage will increase from $5.15 per hour to $5.30 per hour, effective July 1, 2007. Employers that do not provide health benefits must pay employees at least $6.33 per hour. Article 15, Section 16(A) of the State Constitution provides for annual adjustments to the minimum wage rates based on increases in the cost of living.
- New Hampshire Minimum Wage—The minimum wage increases to $6.50 per hour, effective Sept. 1, 2007, and to $7.25 per hour, effective Sept. 1, 2008. Employees who receive at least $30 per month in tips must be paid 45 percent of the minimum wage.
161 — WAGE PAYMENT & DEDUCTION
- Indiana Wage Payment Requirements—Employers must make wage payments not more than 10 business days following the close of a pay period and wage claims of less than $6,000 can be assigned to the state Department of Labor for collection, effective July 1, 2007.
- Kansas —Employers can use e-mail or other electronic communications to notify payees of unclaimed wages, effective July 1, 2007; Effective July 1, 2007, employers can pay wages by payroll card if employees are allowed at least one withdrawal per pay period at no cost for an amount equal to net wages and employees are not charged any initiation, loading, or participation fees, with certain exceptions. Employers also can pay wages by direct deposit to accounts designated by employees and written employee consent is no longer required if certain requirements are met.
- Nebraska Payment on Termination—Paid leave, other than earned but unused vacation leave, is not included in the wages due at the time of separation unless certain circumstances exist. On separation, commissions are due on the next regular payday following receipt of payment for the goods or services from which commissions were generated and employers must give employees a periodic accounting of outstanding commissions.
- Utah Payment on Termination—Effective April 30, 2007, employers must pay sales representatives under contract commissions due within 30 days after termination or within 14 days after a commission is due if the commission is due after the termination is effective.
171 — UNEMPLOYMENT INSURANCE
- Arkansas— Effective July 1, 2007, the Department of Workforce Services will no longer permit magnetic tape reporting. The Department, however, is expanding its magnetic diskette reporting format, effective at the end of the second quarter.
- Kansas—Employers will not be permitted to file unemployment insurance quarterly wage reports via magnetic media (CDs or diskettes) after June 1, 2007 (formerly scheduled for May 1, 2007).
- Mississippi—Effective July 1, 2007, a temporary employee who does not contact the temporary firm for reassignment after completing an assignment will be considered to have quit voluntarily; however, disqualification will not apply unless the individual is advised in writing of the obligation to make contact upon completion of an assignment. An employer's account will not be charged for benefits paid if unemployment is because of a major disaster declared by the president, also effective July 1, 2007.
- Montana—The "covered and exempt employment" section regarding independent contractors is updated.
- New Mexico—Effective July 1, 2007, through Dec. 31, 2010, employers will be assessed a supplemental contribution for a newly created state unemployment trust fund; however, the employer's tax rate will be reduced by the same amount to offset the supplemental contribution. Claimants will not be disqualified from receiving benefits if they voluntarily leave work because of a mandatory military transfer of their spouse, effective July 1, 2007.
- North Dakota—Effective Jan. 1, 2008, employers with 100 or more employees must file their quarterly contribution and wage reports electronically. All agents or employer representatives remitting payments for more than one employer are required to make payments electronically.
- Texas— Effective July 1, 2007, employers with 10 or more employees in any one calendar quarter are required to file their quarterly unemployment tax reports electronically or magnetically. Agents reporting on behalf of multiple employers, who file reports on a cumulative total of 10 or more employees, also are required to file electronically or magnetically.
- Utah— Effective April 30, 2007, authorized employer representatives filing quarterly unemployment tax reports for 100 or more employers during any quarter are required to file these reports magnetically or electronically.
- Washington—Employers that fail to file timely quarterly tax and wage reports will be subject to a penalty, effective Oct. 1. Employers' accounts will be appropriately charged for any benefits paid because of errors on their reports.
181 — STATE & LOCAL WITHHOLDING
- States Following Federal Income Tax Withholding Laws Comparison Chart—Arizona follows the IRC effective Jan. 1, 2007.
- Annual Reconciliation Reports Paperless Filing State Comparison Chart—Nebraska requires employers filing 250 or more reports to use electronic media, effective Jan. 1, 2008.
- Nebraska Income Tax Withholding— Effective Jan. 1, 2008, employers with 25 or more employees must withhold at least 3 percent of employees' wages, unless the employees provide "satisfactory evidence" that a lower rate should apply. Effective Jan. 1, 2008, employers permitted to file federal returns annually may file their state returns annually. Starting Jan. 1, 2008, employers filing 250 or more wage statements must file electronically. Beginning Jan. 1, 2008, employers that fail to withhold the 3 percent tax if required to do so pay a penalty of $1,000 per violation; interest is charged on unpaid taxes at a rate of 8 percent through Dec. 31, 2008.
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