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Doing Business in California
  Updated June 28, 2008
    

Business Owner's ToolKit

Business Forms Library
Paying wages "under the table". Is it worth the risk?
Many employers do not realize that when they get caught doing this, their CA state payroll tax liability will be 20 times more than if they would have voluntarily reported the employee's wages and paid the payroll taxes.

         

Cash Shortages and Uniform Requirements
Can I deduct a cash shortage or uniform costs and loss from an employee's paycheck? We are also often asked how to properly deduct the cash shortage from the employee's paycheck.

         

How Employers Can Prevent UI Imposter Fraud
Here are tips on how you can help EDD prevent UI imposter fraud, identity theft, and, at the same time, help control your UI costs.

         

California's Paid Family Leave Bill

Former Gov. Gray Davis signed a law that makes California the first state to offer workers paid family leave. The law, financed by an employee payroll tax, allows workers to take six weeks off to care for a newborn, a newly adopted child or a sick family member.

         

Cash Flow Worksheet

With the continuous increases in our California client's operating expense statements, now might be a good time to review the cash flow of your business.

         

California's Paid Family Leave Insurance Program
For California workers covered by State Disability Insurance, Paid Family Leave insurance provides up to six weeks of benefits for individuals who must take time off to care for a seriously ill child, spouse, parent, or domestic partner, or to bond with a new minor child.

         

Employee Meal and Rest Periods
Many employers frequently ask exactly what are the meal and rest period requirements. The following is a word-for-word explanation of your responsibilities towards your employees when you have to give meal and rest periods. This includes cashiers.

         

California's Rules on Employing Minors
In California, a permit to work must be issued to a minor 14 to 17 to work outside of school hours for a period of time.

         

Child Support and Wage Assignments

Under state law, when an employer fails to comply with a wage assignment order, local child support agencies may obtain a court order to require the employer to make child support payments through electronic funds transfer.

         

Personnel Files - Who Can See What
In the State of California, your personnel files are not as private as you might think. Although many employees don't know it, they are entitled to look at their files. If you're not careful, this issue can cause you some severe headaches.

         

Calculating Employee Hours Worked
An employer may not arbitrarily fail to count as hours worked any part, however small, of the employee's fixed or regular working time or practically ascertainable period of time he is regularly required to spend on duties assigned to him/her.

         

California Overtime Law
Questions have been recently asked as to the definition of California overtime. Here is a clarification of the rules we must live with.   

         

Firing Medical Marijuana Users OK
Employers can fire workers found to have used medical marijuana that was legally prescribed, the California Supreme Court ruled in another setback for California in its increasingly rancorous clash with federal law over medical pot use.

         

When to Throw-Out -- What
Ready to clean out the closet? Here is a suggested retention plan to comply with year 2008 regulations, and some guidelines to help streamline your company's document filing system.

         

New 2008 Requirement for California Employers
Effective January 1, 2008, all California employers are required to provide all employees with written notice of their possible right to an Earned Income Tax Credit on their federal income tax returns. Go here for everything you need.

         

Which Benefits Are You Required to Offer?
In the state of California small employers are not required to provide certain benefits. So what do you have to do? Here's the listing of what you have to and do not have to provide employees.

         

Alternative Work Schedules and Make-Up Time
Is granting an employee's request to work make-up time the employer's sole discretion? And what if the workforce wants an alternative work schedule?

         

Employee Payroll Deductions
We are often asked what you can and can’t deduct from an employee’s paycheck. Here are some things that you should not deduct.

         

California Cracks Down on Drug Paraphernalia in C-Stores
A law designed to educate liquor licensees and prevent the sale of drug paraphernalia in convenience stores and liquor stores is being enforced.

         

Who's Exempt From Overtime
Federal and state laws require most employers to pay overtime. These laws contain many exceptions, so not all employees are entitled to overtime. Are your employees entitled to overtime pay? Learn the rules here.

         

Sexual Harassment Guidelines
A program to eliminate sexual harassment from the workplace is not only required by law, but it is the most practical way to avoid or limit damages if harassment should occur despite preventative efforts.

         

Sales of Food & Beverages by Mini-Marts & Convenience Stores
There is some confusion among convenience stores and mini marts regarding the taxability of heated foods, hot drinks, and prepackaged foods that are heated in a microwave by the store clerk or customer. The following information should answer most of those questions.

         

Merchants Targeted in Youth Smoking Crackdown
Retailers who sell tobacco products in California will be subjected to more inspections to make sure they are not selling to minors.

         

Purchasing a Business with Employees in California
If you purchase a business with employees (or that previously had employees), you may be held liable for the previous owner’s EDD liability if a Certificate of Release of Buyer (DE 2220) is not obtained.

         

California Taxpayers Face More IRS Scrutiny
Taxpayers in California are four times as likely to be audited by the Internal Revenue Service as those living in other states, according to a study reported by the The New York Times citing a university study of tax data.

         

Do Your Employees Claim Exempt Status?
If your employees wish to specify different withholding for State purposes, an Employee Withholding Allowance Certificate (DE 4) must be filed.

         

Regulations Covering the Discharge of Any Employee
You must give immediate written notice to an employee of his/her discharge (fired), layoff, leave of absence, or suspension. The written notice must include five items which meet the minimum requirements.

         

Lactation Accommodation Legislation
Women with infants and toddlers are the fastest growing segment in the workforce in the United States.

         

California Employee's Withholding Allowance Certificate
Sales Tax Rates by County

                      

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San Francisco Update  
SF City Minimum Wage Increase To $9.14 per hr
Here's the rules for 2008 and posting requirements.

                   

Questions Regarding Payroll Regulations

Here are a few of the most often asked questions we get regarding payroll and overtime regulations.


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When is double time due?

The Fair Labor Standards Act (FLSA) has no requirement for double time pay. This is a matter of agreement between an employer and employee (or the employee's representative).

In California you will have to double the employee’s rate for time worked beyond twelve hours in a single day. Employers are also required to pay time and a half for all hours worked on the seventh day of the work week and double time over eight hours on the seventh day of the week.

                   

  Reminder: In 2008 the    State's minimum wage is currently $8.00 per hour. For automotive technicians who bring their own tools the minimum wage is $16.00 per hour (minimum wage times two). NOTE: Those on salary are required to receive the minimum wage times two ($16.00) per hour worked. *Possible overtime may apply.