Deferring Payroll Taxes

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On August 8, the President issued an Executive Memorandum allowing employees who make less than $104,000 a year to defer their payroll taxes starting September 1 through the end of 2020. This is an update on what we know as of today.

The business community is awaiting guidance from the Treasury Department regarding the implementation of this memorandum. The Secretary of the Treasury, Steve Mnuchin, has stated that participation will be voluntary. Therefore, employers can choose not to allow their employees to take advantage of this deferral. In addition, the President’s top economic advisor, Larry Kudlow, stated that the President is looking for ways to “fully forgive” the payroll tax deferral. But nothing has been issued in writing from any US Government entity.

DOL Proposes Amendment to Clarify Overtime Pay Calculations

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The Fair Labor Standards Act (FLSA) generally requires overtime pay of at least 1 ½ times the regular rate of pay for hours worked in excess of 40 hours per week for non-exempt employees.  The Department of Labor (DOL) published a Notice of Proposed Rulemaking (NPRM) to amend the rules regarding how overtime is calculated, specifically related to what forms of “regular pay” employers include and exclude in the 1 ½ times calculation.