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Prop 206 FAQ's

Posted By Kristi Feist, Payday HCM, Tuesday, March 7, 2017

Frequently Asked Questions (FAQ’s) About Proposition 206

This is an unofficial publication with the intent to answer some of the FAQ’s we continue to receive on Proposition 206, and more specifically the Earned Paid Sick Time.  All information provided is herein for informational purposes only. 

What is proposition 206?

Proposition 206, the Fair Wages and Healthy Families Act passed during the November 2016 election and affects all employers.  Approved by over 50% majority, it establishes the new state minimum wage (effective January 2017) and earned paid sick time requirements. 

What is earned paid sick time (EPST)?

Time accrued by an employee that is compensated at the same hourly rate and with the same benefits, including health care, as the employee would normally earn during hours worked. 

How much EPST must an employer offer?

15 or more employees - Employees must accrue a minimum of one hour of earned paid sick time for every 30 hours worked, but employees are not entitled to accrue or use more than 40 hours of earned paid sick time per year, unless the employer selects a higher limit.

Less than 15 Employees - Employees must accrue a minimum of one hour of earned paid sick time for every 30 hours worked, but they are not entitled to accrue or use more than 24 hours of earned paid sick time per year, unless the employer sets a higher limit.

What needs to be communicated to my employees about the EPST?

Employers must give employees written notice of the following at the commencement of employment or by July 1, 2017, whichever is later:

• Employees are entitled to earned paid sick time;

• The amount of earned paid sick time that employees are entitled to accrue;

• The terms of use guaranteed by Arizona’s earned paid sick time laws;

• That retaliation against employees who request or use earned paid sick time is prohibited;

• That each employee has the right to file a complaint if earned paid sick time is denied by the employer or the employee is subjected to retaliation for requesting or taking earned paid sick time; and

• Contact information for the Industrial Commission. The Industrial Commission’s 2017 model earned paid sick time notice can be found here. An employer must also provide employees either in or on an attachment to the employee’s paycheck:

• The amount of earned paid sick time available to the employee;

• The amount of earned paid sick time taken by the employee to date in the year; and

• The amount of pay time the employee has received as earned paid sick time.

Can employers have a waiting period before EPST can be used? 

An employee may use earned paid sick time as soon as it is accrued. However, an employer may require an employee hired after July 1, 2017 to wait 90 calendar days after the start of employment before using accrued earned paid sick time.

Must an employer carry forward balances of EPST at the end of a year to the next year?

Yes, unless the employer pays out any unused EPST at the end of the year and provides the employee with an amount of EPST in full as of January 1 the subsequent year. 

How does this affect my current PTO Policy?

If there is a current PTO policy in place that meets the or exceeds EPST minimum requirements the employer is not required to provide additional pto.  However, then all earned PTO can be used for the same purposes as the EPST. 

Can I ask for documentation when EPST is used?

Yes, but only if the EPST was taken on 3 or more consecutive days.  The employer cannot use EPST as an absence that may lead to an adverse action such as discipline or discharge.  

 

Have more questions?  Join us March 14th as PayDay HCM welcomes two lawyers to aide us in Navigating Proposition 206.

 

Tags:  HR  Legal  Small Business 

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Should you consider a commercial construction loan?

Posted By Julie Smith, Horizon Community Bank, Wednesday, February 22, 2017

Your business has grown, and it might be time to move into your own building. You’ve looked at commercial real estate for sale or lease, but just haven’t found what you’re looking for. The location or size is wrong, its age requires costly remodeling, or some other feature excludes every property you’ve seen.

Should you build?

Learning about the process, securing a loan and other basic details might help you decide.

HOW DO I BEGIN THE PROCESS?

There are many ways to educate yourself about commercial construction loans, but the fastest path to a smart answer is a straight line to experts who deal with this every day. Obtaining their help to answer these three questions is where you begin.

1. Can you qualify for funding? Meet with a commercial banker to discuss financing. Traditional partners include a commercial builder, a commercial real estate agent, a real estate attorney and a banker. We suggest beginning with the banker to be sure you qualify for the necessary funding before you spend too much time pursuing construction or shopping for land. It gives you a solid understanding of payments you can afford, how much of cash you’ll need for the down payment, and other important financial details.

According to Propertymetrics.com (and a sentiment we agree with), “construction or development loans are almost always [financed by] local community or regional banks. Historically this was due to bank regulation that restricted trade areas for lending.”

 Using a community bank also gives you access to a commercial banker with strong local relationships and a solid understanding of the local market. This can be incredibly helpful when selecting other construction partners. The banker often knows builders personally or by reputation, and can point you in the right direction with options you might not have considered. 

 The right banker can also help you with customized financing, since you won’t need just one loan. You’ll need to understand the kind of funding your cash flow can support, and obtain a package loan that includes short-term (mini-perm) funding to purchase land and fund building costs, then a long-term mortgage loan to pay it off at a lower interest rate. Other loans might be included in your package, which the banker will help you understand. It’s a complex process. 

2. How long will it take? Put together a realistic timeline from funding through move in. Building from the ground up is a labor-intensive, LONG process. Not every business can afford to wait a year or longer to move in.

Sitting down to think through the process and how long a build takes from start-to-finish is sobering. Is waiting twelve or eighteen months a problem for business operations? Do you have that kind of time?

Talking this over over with your construction partners, along with the actual timeline of similar local projects, may be just the realization needed to make a decision that’s right for you.

3. Is land available in the location you prefer? Arizona is growing quickly, and its major cities are challenged with rapidly disappearing empty lots for sale. It’s harder and harder to find land that isn’t already occupied. Depending on budget, some are even bulldozing older buildings to make room for new construction in premier locations. Commercial builders have insight into available land, as do commercial real estate agents. Once you have discussed financing and are qualified to secure funding, it’s time to start looking at real estate options.

Figuring out if the right piece of property is available or not can swiftly guide your decision to build.

WHAT DOES THE UNDERWRITING PROCESS LOOK LIKE?

Funding for a commercial loan can differ based on the use of the building. If it’s an investment and you’ll be leasing space, terms are different than an owner-occupied loan. A banker considers the property’s ability to generate cash flow, instead of just overall cash flow for the business, and the investor’s experience and ability to manage the property. If the property is to be owner-occupied, a Small Business Administration (SBA) loan may also be considered.

For the sake of this article, let’s assume the loan is for an owner-occupied building. Before a banker begins helping you create a pro-forma document detailing the construction project, budget, market conditions, builder/contractor information, financials and credit history, they will discuss the purpose and goals of the project with you, and do a preliminary screening of your creditworthiness. From the preliminary information provided, the bank will decide if the proposed transaction meets its criteria for a qualified transaction. If the initial decision is to move forward, a term sheet is provided outlining details of the proposed loan.

Then the real work begins. The business owner will be asked to provide common financials, such as personal tax returns, profit and loss statements for the business, construction cost estimates and full project plans, and more. The banker will work with you to complete the process, which is extremely detailed.

Once loan underwriting is complete, the loan shifts into the closing process. It’s complex, with a vast amount of paperwork and processes required to protect the banker and borrower. Because the construction loan is funded in stages based on project completion, the borrower won’t receive a check and be on their way.  Both the borrower and the developer will work closely with someone at the bank to follow bank policies and procedures in accordance with the loan terms.

TWO THINGS TO REMEMBER

Because of the time involved and how closely the relationships must work together, choosing the right combination of banker and builder is essential. You’re virtually married to them to them for years, in constant communication almost every single day. Their experience, skills and connections make all the difference

It’s also important to understand the time commitment commercial construction requires before you commit to the project. It’s not just about how many months it takes to complete, but how much of your time the project will require.

Business owners are busy and construction projects have a million and one details demanding attention. Sitting down to think through the process and how long a build takes from start-to-finish is sobering. It’s virtually a full-time job on its own. Do you have that kind of time? Can you afford the intangible “cost” of diverting attention from your business to the construction process? These are worth consideration.

If this isn’t something a borrower can manage, perhaps it’s better to purchase and retrofit an existing building, rather than building.

Commercial construction is an intimidating venture for beginners. If you have questions about funding, qualifications or the process, Horizon Community Bank is here for you with a free, no-obligation consultation. Contact us today, we’re pleased to help. You can also reach out to us on our Facebook page

Tags:  business  business loan  commercial real estate  financing  small business 

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Arizona Judge Dismisses More Than 1,100 ADA Cases

Posted By Trey Lynn, Ogletree Deakins, Tuesday, February 21, 2017

Arizona Judge Finds Standing Is a Must for Serial ADA Plaintiff, Dismisses More Than 1,100 Cases

Author: Caroline Larsen (Phoenix)

Published Date: February 20, 2017

An Arizona judge dismissed more than 1,100 lawsuits against Arizona businesses alleging that their parking lots are not accessible to persons with disabilities. Judge David M. Talamante rejected the plaintiffs’ argument that the Arizonans with Disabilities Act (AzDA) permits any person who believes a place of public accommodation has violated the act to bring a civil action.

The court found that any plaintiff in an Arizona court must demonstrate that it has experienced injury or harm to establish standing to sue. The court further found that these plaintiffs failed to make such a showing, since they did not allege that they ever visited or attempted to visit the businesses they sued. 

In 2016, the plaintiffs filed more than 1,500 virtually identical lawsuits alleging minor, technical violations of Title III of the Americans with Disabilities Act of 1990 (ADA) and the AzDA, such as a lack of “van-accessible” signage or signs that are posted a few inches too low. In September of 2016, the court entered orders consolidating more than 1,100 pending cases and permitting the Arizona Attorney General’s Office to intervene as a limited purpose defendant in order to pursue dismissal of all the actions.

Prior to the February 17 oral argument, the court denied denied plaintiffs’ motion to present additional briefing in light of a bill pending in the Arizona Legislature that seeks to revise the AzDA to expressly clarify that only an aggrieved person who believes a place of public accommodation has violated the Act may bring a civil action.

Upon granting the motion to dismiss, the court directed the Attorney General to file a proposed form of judgment, along with any motion for sanctions, attorneys’ fees, and costs, within 10 days. The plaintiffs’ counsel, Peter Strojnik, asked that the final judgment be entered as soon as possible, suggesting he may pursue an appeal of the dismissal on behalf of his clients. The Arizona Court of Appeals previously denied the plaintiffs’ petition for special action review of an earlier order denying its motion to strike Judge Talamante from presiding over the cases brought by AID.

What Can Your Business Do?

While Judge Talamante’s order brings the first round of litigation to a close, the appeals process may keep the Arizona businesses affected by these lawsuits in the court system for at least another year or two. Business owners should also note that this decision will not signal the end of these kinds of lawsuits, which remain on the rise around the country. Business owners in Arizona and other states should carefully assess their physical places of business and the way they provide their services to ensure that they comply with the ADA.

Caroline Larsen  (Phoenix)

Caroline Larsen
Caroline Larsen has litigated and defended clients in a wide variety of employment matters in various venues, including Arizona state court, various district courts, the Arizona Court of Appeals, the Court of Appeals for the Ninth Circuit, the Equal Employment Opportunity Commission, the Department of Labor, Arizona Civil Rights Division, U.S. Department of Justice - Office of the Chief Administrative Hearing Officer, the Arizona Division of Occupational Safety and Health (ADOSH), U.S....

Tags:  attorney  law  lawyer  Legal  legal services 

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Federal Law Alert: New I-9 Form Released

Posted By Kristi Feist, Payday HCM, Monday, January 30, 2017

The new I-9 form was released recently. It may now be used, although the old form will remain valid through January 21, 2017. After that date, you must use the new form. We recommend you train all employees who are responsible for completing the I-9 and start to use it for new hires as soon as possible.

A few important notes about this new form:

  1. While the new I-9 is intended to be completed as a fillable PDF to reduce errors, it should not be confused with an electronic I-9. An employer must still print the completed I-9, obtain the appropriate signatures (which are not fillable via PDF), monitor reverifications, and retain the form for the proper retention period. Employers and employees may choose to complete any or all of the form by typing into the fillable PDF or using a pen to fill out sections after the document has been printed. Documents that are partly printed and partly handwritten are acceptable. If using an electronic version of the I-9, employers must still comply with the U.S. Citizenship and Immigration Services¹ criteria to be certain of the integrity of the electronic system. 
  2. Do not reverify current employees due to the new form. Use the new I-9 only for newly hired employees and when you are required to reverify temporary work authorization. Additionally, all previous forms must still be retained for the proper retention period. The form must be retained for as long as the employee works for you, plus three years after their hire date or one year after their termination date, whichever is later.
  3. To download the form from the USCIS website (uscis.gov/i-9), right click on the link to the new form‹³Form I-9 (PDF, 535 KB)² ­ and select the ³Save link as² option. This will allow you to save the PDF and open it in a PDF reader. Clicking to open it in a web browser (as you would with most links) will result in an error page.
Notable changes to the form itself include the following:
  • When completed electronically, there are prompts to ensure information is entered correctly. For example, the form will validate that the correct number of digits are entered for an employee¹s Social Security number and various expiration dates. Calendars and drop-down lists also include electronic assistance.
  • The form includes on-screen instructions for each field as well as easy access to the full instructions.
  • In Section 1, employees must only provide other last names used, as opposed to all other names used. 
  • Below an employee¹s signature line, they must indicate via checkbox whether a Preparer and/or Translator was used to complete Section 1. Multiple preparers/translators can now be entered into Section 1 if needed.
  • There is a dedicated area for including additional information (when required) rather than having to add it in the margins.
  • In Section 2, employers will find a new ³Citizenship/Immigration Status² field in the first line with numbers one through four. These numbers correlate directly to the employee¹s selected citizenship or immigration status entered in Section 1. If you use the fillable version of the form, the corresponding digit will pre-populate. If you use a paper version, enter the corresponding digit in this field. These fields (the top line of Section 2) help to ensure that the two pages of an employee¹s Form I-9 remain together.

The USCIS has yet to release a new Handbook for Employers (M-274) and advises employers to follow the new form instructions for the most up-to-date information. The updated instructions are also available for download on uscis.gov/i-9.

Please contact the HR Professionals at Payday HCM for assistance at 888-2PAYDAY or 505-255-5422

Tags:  financial  legal 

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IRS Focus: Get Transcript Online

Posted By Lisa Novack, IRS, Wednesday, September 28, 2016

This IRS Focus is on the new secure access process for Get Transcript Online resources on www.IRS.gov.

The IRS recently enhanced its e-authentication procedures required to register and use certain self-help tools on IRS.gov. These new e-authentication procedures are currently being applied to Get Transcript Online.  You can get various transcript types online. The method you used to file your return and whether you have a refund or balance due, affects when a current year transcript is available.

The IRS Focus information below has links to Get Transcript Online resources. You may also go to www.irs.gov and Search: Get Transcript Online.

Please share this with your members, staff, colleagues and anyone who may benefit from this information. If you would like it in a PDF document or Word document, please email me at Lisa.A.Novack@irs.gov and I will sent to you. 

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