by Stephanie Baxmann | Jul 8, 2024 | Payroll, Regulatory Compliance, Uncategorized
Cyberattacks leave no stone unturned in the 2020s. According to Forbes, organizational data breaches increased 72% between 2021 and 2023. Data breaches aren’t just stolen credit card details and addresses from customers; internal payroll data is a prime target for cyber-attacks given the wealth of personal and organizational information in payroll records.
How do you keep your organization safe from bad actors as they get more sophisticated and convincing? Here’s why payroll data security is important and what you can do to create robust protections for sensitive data in payroll records.
The Importance of Cybersecurity for Payroll
Payroll records contain highly sensitive data that is a goldmine for hackers. Not only do they have employees’ legal names and current addresses, phone numbers, and other contact information, they also contain bank details. Social Security numbers and other identifying numbers, like International Tax Identification Numbers, can be used to steal someone’s entire identity and do everything from taking out loans and credit cards in their name, to signing leases.
Salary information is also in payroll records. While an employee could voluntarily discuss their salary privately, involuntarily revealing salaries to the public can sow distrust in both the employee and the organization.
Protecting payroll information is paramount for both short-term safety and long-term prosperity at both the personal and organizational levels. Breaches can cost millions of dollars to address. If an employee’s bank information or identification number is compromised, it can completely disrupt their lives for several months while they sort it out with the Social Security Administration. They won’t be able to perform very well at work if they are worried about their personal finances, future plans, and the havoc wreaked by a stolen identity.
Payroll Security Best Practices
Cybersecurity for payroll doesn’t have to be an overly complex system. While a cybersecurity professional may be necessary in some situations, there are some basic best practices that even those who are not the most tech-savvy can implement to keep payroll data safe from bad actors. These include:
Use strong authentication methods.
Two-factor authentication can be set up in online payroll accounts for both users and administrators. Email servers and any other portal where sensitive data is at risk should also have two-factor or multi-factor authentication enabled.
Conduct regular security audits.
Semiannual or quarterly security audits with a cybersecurity professional can help your organization address vulnerabilities before they become serious problems. New cybersecurity threats are constantly cropping up and evolving. Routine security audits can keep the organization on top of these threats before they become breaches.
Train employees on phishing, deepfakes, and other cybersecurity threats.
Even tech-savvy employees can fall for deepfakes, which are becoming more convincing. All it takes is a snippet of a phone call with a manager to get a voice sample that sounds genuine, convincing that employee to hand over sensitive information and putting themselves and the entire organization at risk. Employee training on the latest cybersecurity threats can help them stay aware of these threats and recognize them when they happen.
Secure data storage solutions.
Secure cloud solutions for payroll data with the ideal functionalities can keep employee information safe without sacrificing convenience.
Payroll services like Affiliated HR & Payroll are in the business of protecting your highly sensitive payroll data. Payroll data security is a cornerstone of our business, and our cloud-based systems offer built-in security features.
Legacy payroll systems are not only clunky to operate, but they also have several vulnerabilities compared to modern systems. Payroll technology plays a major role in enhancing data security, and payroll cybersecurity doesn’t have to be overly complex.
Proactive vs. Reactive: Your HR Data Security Strategy
Organizations need to have a proactive approach, rather than a reactive one that only responds to threats after they become imminent. Payroll security requires ongoing vigilance to ever-evolving cyber threats rather than damage control once a breach occurs.
A holistic and proactive approach to payroll data security ensures that threats are mitigated before they appear on the radar. Strong authentication, employee awareness of the latest cyber threats, secure data storage, and routine security audits can keep your organization on the up and up. Affiliated HR & Payroll’s payroll security experts are here to ensure your information stays safe.
Protect your business from cyber threats with secure payroll solutions from Affiliated HR & Payroll. Contact us today for a consultation.
by Stephanie Baxmann | Jul 2, 2024 | HR Administration, Payroll, Texas, Uncategorized
Businesses nationwide are turning to the independent workforce to weather uncertain economic times and waves of layoffs. Small businesses frequently rely on freelancers and gig workers when they need extra help for a project or busy time of year.
However, just because a worker is temporary or agrees to be paid as an independent contractor doesn’t make them one under federal and Texas laws. Here’s what you need to know about Texas employment law regarding worker classification and how worker classification is defined in Texas.
How Does Texas Employment Law Define an Independent Contractor?
In Texas, the distinction between an employee and an independent contractor is based on the 20-factor test used by the IRS to determine if the work is independent or dependent on personal services. Worker classification is done on a case-by-case basis, with not all factors given equal weight or consideration. These are the factors Texas labor law examines:
Instructions
Employees are given specific instructions on when, where, and how to work. Independent contractors can receive some guidance and examples, but they have the freedom to choose how, when, and where they want to do the job.
Training
Not all workplaces offer training, but employees are typically trained by an owner, manager, or more senior employee. There may also be required training sessions or coursework. Independent contractors have their own licensing, education, and credentials and generally don’t receive training beyond onboarding new programs.
Integration and Reliance
Organizations rely on their employees for successful operations. Independent contractors are usually brought in on a project basis or work separately from the client’s overall operations.
Services Rendered Personally
Independent contractors are able to farm out their gigs to other subcontractors or individuals. Even senior employees cannot delegate work they must personally perform to another employee.
Supervision and Help
Employees in management capacities may take on additional help, such as seasonal and temporary employees, interns, and new hires, but the employer pays these helpers. Independent contractors who need additional help are responsible for their results and for paying for their time.
Continuous Relationship
Permanent employees are expected to remain with the same employer for some time. Independent contractors usually work on a project basis or have a defined start and end date. While they may work with regular recurring clients, the relationship is never assumed to be in perpetuity like an employee-employer relationship.
Set Work Hours
Employees work at their employer’s discretion. They are told which days and hours they must work. Independent contractors have complete autonomy over the timeframes in which they work, deadlines notwithstanding.
Reliance on the Employer or Client
Employees are generally devoted to one employer, with the employer having the right to prioritize the employee’s time. Independent contractors virtually never devote themselves exclusively to one firm.
Location
Employers can dictate if employees can work at home or must report to the office or other job sites. While this depends on the nature of the work, independent contractors can work wherever they want. They also generally supply their own fixed base, such as a home or rented office, while employees rely on their employer to set this for them.
Sequential Order
Employees must perform tasks according to the employer’s instructions, demonstrating the employer’s control over them. Independent contractors focus solely on the results and submit them to the client on time. They decide on orders or sequences for how they work.
Reporting Requirements
Employees may be required to submit oral or written reports to their employers regarding their workloads, projects, and organizational objectives. Independent contractors may voluntarily provide these reports for large projects, but they are usually not mandated to submit such reports.
Payment
Employees are typically compensated at specific intervals, such as weekly payment for hourly wages or biweekly for a salary. Independent contractors are remunerated based on an agreed-upon project rate and invoice for their hourly work.
Business and Travel Expenses
Employee business and travel expenses are usually covered by the employer through company funds and credit cards or reimbursement of personal funds. Independent contractors generally pay for all of these expenses out of pocket.
Tools and Equipment
Employees are typically provided with the tools and equipment needed to do their jobs. While it isn’t out of the ordinary for employees to have their own hand tools, they usually are not buying large pieces of equipment.
Independent contractors, however, pay for their own tools and invest more significantly in their equipment than laptops and basic hand tools.
Investment
Even if an employee has some equity in their employer’s company, they are economically reliant on it otherwise. They usually don’t own the means of production. Independent contractors are substantially invested in their independent business and want to ensure it is profitable.
Profit or Loss
Employees are paid for their services regardless of how well the company is doing. Independent contractors realize a profit or loss based on their revenues and expenses.
Working for More than One Client or Employer
While second jobs and the “over employment” trend have gained popularity in the 2020s, most permanent full-time employees only work for one employer. Independent contractors are expected to do the opposite and never rely solely on one firm for revenue.
Public Availability
Generally, an employee’s service is between them and their employer. Their services are not made available to the public. Independent contractors make their availability known to the public in some way, be it through business cards, dedicated websites, social media presence, business licenses, and other types of promotion.
Ability to Quit
Texas is an at-will state, so employers can terminate an employee whenever they want without providing a reason. In turn, employees can quit at any time without being held liable to the employer.
Independent contractors may be held liable, even if the client doesn’t enforce it. They may be in breach of contract if they terminate the job before fulfilling their contractual obligations or must compensate the client if it takes them a long time to find a suitable replacement contractor.
Consequences for Improper Worker Classification
As the nature of work in the 21st century continues to evolve, many confusing labor compliance matters arise. Just because a worker works from home or has a flexible arrangement doesn’t necessarily mean they’re an independent contractor by default.
Employers don’t have to pay payroll taxes or contribute to the Texas unemployment fund when a worker is an independent contractor. Subsequently, the TWC fines employers for each instance of misclassification. The severity of the fine depends on whether it was willful or not, and the extent of the unpaid taxes owed. If your Texas organization has government contracts, there is an additional $200 per misclassified employee.
Additionally, there may be consequences at the federal level for not paying into the federal unemployment fund and insufficient employer FICA contributions. This is also based on whether the misclassification was willful or an honest mistake.
Ensure Compliance with Affiliated HR & Payroll
Worker classification is a complicated compliance area that is constantly changing due to tax and labor law shifts. Affiliated HR & Payroll’s compliance experts can help you stay compliant with TWC and IRS regulations regarding the correct classification of workers. Ensure your business stays compliant with Texas laws. Contact Affiliated HR & Payroll today for expert guidance on worker classification and other HR services.
by Afilliated HR & Payroll | Jun 27, 2023 | HR Administration, Performance Management, Uncategorized
Though we’re all different, we can all thrive in the same workplace.
That’s the motivating belief behind efforts to increase diversity, equity, inclusion, and belonging (DEIB). When done well, these efforts redesign the workplace from an environment that holds certain people back to one that empowers everyone to succeed. Together, they create an environment where people know it’s safe for them to show up as themselves—where they’re welcomed, wanted, rewarded, and celebrated.
Unsurprisingly, the majority of employees want to work for an employer who values these principles. In general, people want to belong; they don’t want to feel isolated and alone, be treated unfairly, or find themselves excluded. Also of no surprise: DEIB efforts have been shown to drive business performance and innovation, balanced organizational management, improved decision making, and increased competitive advantage.
While the terms diversity, equity, inclusion, and belonging are similar, each word has a specific meaning and importance in the workplace. Let’s go over each one.
Diversity
Diversity is the measure of representation in a place—particularly the representation of groups that have historically faced discrimination in the workplace. For example, a leadership team that includes women, transgender, Black, and disabled employees would be more diverse than a leadership team comprised mostly of able-bodied white cisgender men. While the latter is much more common, diversity efforts are meant to change that.
Increasing diversity can be a challenge. For one, basing hiring decisions on membership in underrepresented groups generally runs afoul of antidiscrimination laws. For another, the degree to which an employer can significantly increase diversity may depend greatly on the overall diversity of their applicant pool. A tech company able to hire remote employees nationally or internationally will likely have a more diverse workforce than a restaurant in a small town with a homogenous population, regardless of the effort put in to increasing diversity.
A diverse team signals to job applicants, employees, and customers that your organization exists for them. Measuring and monitoring diversity is important because decreased diversity may indicate that your organization is not as welcoming as you want or need it to be. For example, if an organization committed to diversity noticed a trend of people of color quitting at a higher rate than white employees, it would investigate to make sure no harassment, intimidation, or bias is occurring and put a stop to it if it is.
Equity
As organizations become more diverse, their focus may shift to addressing issues with equity such as inequitable access to training, promotions, or other opportunities. Equity means giving each employee what they need to be successful. It’s more than providing all employees with access to the same resources and opportunities. Equity acknowledges that people have different needs, pressures, obstacles, and pathways to success. The accommodation that enables one person to do their job well may not be helpful for another. The practice that seems to work well for most people may be a hindrance to a few. Equity aims to correct these imbalances.
Inclusion
Inclusion is the work done to make everyone feel like a valued member of the team—appreciated and supported. Inclusion ensures that everyone feels safe being themselves, empowered to do their best, and rewarded fairly for their efforts.
Leaders at inclusive workplaces will often invest in employee resource groups (ERGs), encourage employee participation, set aside time for sharing and celebrations, listen to what these groups have to say about DEIB challenges in the organization, and make changes when helpful. A sign that an organization has an inclusive culture is that it regularly makes decisions based on feedback and input from employees.
Inclusive managers actively support and advocate for their people. As Minda Harts, CEO of The Memo LLC, notes, Black women generally receive far less professional investment from managers than their white counterparts. That’s true of other groups as well—employees with disabilities, for example. When people don’t feel appreciated, valued, and supported, they tend to leave, and that in turn can make organizations less equitable and diverse—not to mention that turnover can be very costly.
Belonging
Belonging is the outcome of the work organizations put into diversity, equity, and inclusion. Belonging is the connection employees feel to their organization because of that work. It’s what motivates them to invest in their organization’s success and the success of their coworkers.
Employees who know they belong feel like they have a place, that they are wanted, that the community wouldn’t be the same without them. They’re more inclined to stay and work for positive change, as opposed to quitting, hoping for a more supportive environment.
by Afilliated HR & Payroll | Aug 31, 2021 | Uncategorized
For health care providers operating in the middle of a pandemic, profit often takes a backseat to saving lives. That’s why many providers have taken money from Uncle Sam in the past year. Some programs intended to help providers get by include Provider Relief Fund General Distributions, Targeted Distributions, Skilled Nursing Facility Infection Control Distributions and Nursing Home Infection Control Distributions. If you received more than $10,000 in the aggregate from those four programs since June 2020, your reporting requirements have just changed.
On Jan. 15, 2021, the Department of Health and Human Services issued guidelines for reporting government income and created its reporting portal. As of June 11, those requirements have changed and deadlines have been extended. You can read the complete announcement, but here are the key changes:
- The period of availability of funds is based on the date the payment is received (rather than requiring all payments be used by June 30, 2021, regardless of when they were received).
- Recipients are required to report for each payment received period in which they received one or more payments exceeding, in the aggregate, $10,000 (rather than $10,000 cumulatively across all PRF payments).
- Recipients will have a 90-day period to complete reporting (rather than a 30-day reporting period).
- The reporting requirements are now applicable to recipients of the Skilled Nursing Facility Infection Control and Nursing Home Infection Control distributions in addition to the General and Targeted distributions.
- The PRF Reporting Portal will open July 1, 2021, for providers to start submitting information.
Now, deadlines to use and report funds are based on the period when the funds were received rather than the year. To find the deadlines that apply to your practice, consult this table:
|
Payment Received Period (Payments Exceeding $10,000 in Aggregate Received)
|
Deadline to Use Funds
|
Reporting Time Period
|
| Period 1 |
From April 10 to June 30, 2020 |
June 30, 2021 |
July 1 to Sept. 30, 2021 |
| Period 2 |
From July 1 to Dec. 31, 2020 |
Dec. 31, 2021 |
Jan. 1 to March 31, 2022 |
| Period 3 |
From Jan. 1 to June 30, 2021 |
June 30, 2022 |
July 1 to Sept. 30, 2022 |
| Period 4 |
From July 1 to Dec. 31, 2021 |
Dec. 31, 2022 |
Jan. 1 to March 31, 2023 |
It’s been a confusing couple of years for health care providers, and reporting income is never fun. But hopefully, the newly extended deadlines will take some pressure off your practice. Be sure to work with a qualified professional to make sure you’re in compliance.
by Afilliated HR & Payroll | Jul 5, 2021 | Uncategorized
President Biden has made Juneteenth (June 19) a federal holiday to commemorate the end of slavery in the United States.
Private employers may choose to close for the day or offer premium pay, but no federal law requires that they do so. Some employers in Massachusetts, however, are already subject to work and pay requirements on Juneteenth. See the MA Holidays Laws page for more information.
Federal contractors and employers that are subject to prevailing wage laws should refer to their contract to determine their obligations.
by Afilliated HR & Payroll | Jun 21, 2021 | Uncategorized
In a 7-2 decision, the U.S. Supreme Court upheld, again, the Affordable Care Act. Texas and other states had sued to overturn it. The court’s opinion, written by Justice Stephen Breyer, said that plaintiffs had argued that without the noncompliance penalty, which had been stripped from the act, the entire law was unconstitutional.
But Breyer wrote, “Plaintiffs do not have standing to challenge §5000A(a)’s minimum essential coverage provision because they have not shown a past or future injury fairly traceable to defendants’ conduct enforcing the specific statutory provision they attack as unconstitutional.” Whether the argument held up was not even discussed: “We proceed no further than standing.”
Concurring with Breyer were Justices John G. Roberts Jr., Sonia Sotomayor, Elena Kagan, Brett M. Kavanaugh and Amy Coney Barrett. Justice Clarence Thomas also concurred, writing his own opinion. Justice Samuel A. Alito wrote a dissenting opinion, in which Justice Neil M. Gorsuch joined.
The entire decision, with dissenting and concurring opinions, runs over 50 pages. Further analysis is available from the SCOTUSblog.
However, commentary from the Society for Human Resource Management summed it up in one sentence: “Employers should note that the health care law remains fully in effect, including all coverage obligations and reporting requirements.”
The ACA Hits a Record
In a release issued earlier this month, the U.S. Department of Health and Human Services announced a new report showing 31 million Americans have health coverage through the ACA, which the HHS says is a record. “The report also shows that there have been reductions in uninsurance rates in every state in the country since the law’s coverage expansions took effect. People served by the health Marketplaces and Medicaid expansion have reached record highs.”
