W-4 Form
On Dec. 11, the IRS uploaded the 2019 W-4 form (https://www.irs.gov/pub/irs-pdf/fw4.pdf).
Perhaps the most prominent change on the 2019 Form W-4 is that Line 5, “Total number of allowances you’re claiming,” is eliminated.
Employees will be “strongly encouraged, but not required” to complete a new W-4 for 2019. Employers will still be able to use 2018 and prior Forms W-4 for employees that don’t complete a 2019 W-4. As a result, payroll systems will need to maintain both 2018 and 2019 withholding systems and calculations simultaneously.
Payroll Taxes
Starting Jan. 1, 2019 the maximum earnings that will be subject to the Social Security payroll tax will increase by $4,500 to $132,900—up from the $128,400 maximum for 2018. See the Social Security Administration (SSA) site for more information.
Changes coming to retirement benefits in 2019 The IRS recently announced cost-of-living adjustments, which will increase the dollar limits on contributions to certain retirement plans for tax year 2019. The changes include an increase in contribution limits that will affect 401(k), 403(b), and some 457 and federal government thrift savings plans. The contribution limit increase is from $18,500 a year to $19,000. The catch-up contribution for individuals over the age of 50 remains unchanged at $6,000. Additionally, the regular and Roth IRA limits were raised to $6,000 annually from $5,500, including an additional $1,000 for individuals over the age of 50. This is the first increase in IRA limits since 2013. With the new year and new limits approaching, 2019 is a great time to guide your employees in evaluating their retirement savings.
Minimum Wage
17 states are raising their minimum wage effective Jan. 1, 2019.
Salary history ban--(“Ban the Box”)
Laws prohibiting employers from seeking salary history information about job applicants will increase in the US as the pay equity movement narrows the gender wage gap between men and women grows in 2019. Your employment application should be reviewed to determine if it’s in compliance with your state.
Paid Leave
Currently there are 10 states that have mandated paid sick leave laws. They include Oregon, Washington, California, Arizona, Michigan, Maryland, New Jersey, Connecticut, Massachusetts and Vermont. In addition, there are specific cities that require paid sick leave.
Medical Marijuana
The following states introduced legislation in 2018 to allow qualified patients to possess and consume medical marijuana. These states are: Florida, Maryland, Michigan, New Hampshire, New Mexico, Ohio, Pennsylvania and Utah.
Workplace Sexual Harassment
One of the biggest compliance shifts for 2019 will also be critical for employers in 2019. The rise of the #MeToo movement has caused significant changes throughout the business world, with employers altering their approach to prevention and training.
Reasonable Accommodations
Another area where legislation is growing at a rapid pace is on reasonable accommodations, especially at the state and local levels. Other accommodation request are becoming more common that can cause confusion for employers. One such example are service and emotional support animals at work.
On the Watch…
USCIC
As the immigration policy and enforcement remains the current administration’s priority, employers will likely continue to see increases U.S. Immigration and Customs Enforcement action and US. Citizenship and Immigration Services (USCIS) policy initiatives in response to White House directives on immigration. Changes are anticipated from USCIS in 2019.
Department of Labor (DOL) Wage and Hour Division
The DOL may re-vamp “white collar” overtime pay
Plan for your salary increase budgets for 2019.
HR compliance can be time-consuming and stressful for small business owners, yet it is critical for companies to comply with federal and state employment laws to avoid penalties and fines. As we kick off 2019, let us help you determine if your business is compliant. If these changes are causing you to overload, The Bradley Partnerships can help you sort through the information, revise policies, handbooks, and assist you with training managers. Please check us out at www.bradleypartnerships.com or contact us at info@bradleypartnerships.com.