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Friday, December 26, 2008

Under the Table Employment

I work at a small company that has been struggling for a long time now. A couple years ago the I was faced with a choice. Get paid under the table, accept a 25% pay cut, and lose health insurance or lose my job. I chose to become an "undocumented worker." So I not have paid or filed for taxes since 2006. I would like to be legitimate and pay my taxes but I live paycheck to paycheck and I really can't pay even this years taxes, much less taxes from previous years. Bankruptcy would offer one potential solution and is worth consideration. But my questions are not about bankruptcy but rather employment.

I have two questions:
1. I have to wonder how this will impact employment verification. When applying for a new job, will the potential employer know that I have not been paying taxes?
2. Assuming I am hired, and the new employer bringing me into their HR and tax systems, will they then learn that I was not paying taxes?

I presume you lost your health insurance anyway, as employees who don't technically exist can't really be added to your health insurance rolls. So, you've just chosen to be dishonest, working for someone who is dishonest and now you fear it might catch up to you.

Ahh, wickedness never was happiness. Sometimes it just takes a while for the unhappiness to catch up to you. Never mind, here are the answers to your questions.

1. For all intents and purposes you have not been employed. If your current company has been paying you under the table, you can't really list it on your resume as your current company. The best you can say is that you were an independent contractor who did work for this company. It's doubtful that they will ask to see your 1099s to verify. Your current employer can offer a reference, stating you are a contactor.

2. No, your new employer will not learn whether you have been paying taxes or not by simply hiring you and bringing you into their system. They will simply start reporting your income to the IRS.

Of course, when the IRS busts you (which they will), they can require your new employer to start garnishing your wages to make up for your lack of tax paying. Fun!

Now, as for the troubles you've created for yourself, I suggest you try to fix it as soon as possible. You say you have no extra money. Well, then, you have no extra money for IRS fines. I suggest you use what money you do have to hire a competent accountant (not a trained monkey at one of those fast food style tax offices) to help you figure out what you owe and what you need to do about it. It can only get worse. If you are a low income earner, it may not be as bad as you feared.

Now, I need the lawyers and accountants (of which I am neither) to weigh in and tell you how much trouble you are really in. It's best to get honest as soon as possible and be honest going forward. And while you are at it, let's get your finances in shape so you don't end up like this again.

Merry Carnival!

The latest Carnival of HR is up over at The Career Encourager.

Tuesday, December 16, 2008

Maybe I Really Am Evil

I checked my site stats and found this:

I'm not sure what I think of that.

Monday, December 15, 2008

Holiday Parties

Two thoughts on Holiday Parties:

One from the lawyers and one from HR.

I hate work holiday parties. Unless they are during lunch and involve good food. (Good food can be pizza, as long as it's not ordered from the company cafeteria.)

A Friendly Warning from the Grim Reaper

I may have hinted a few times that I know a thing or two about layoffs. This would be true. I do. In fact, if you see me coming, it's best to start packing up your things right now because it will save us all hassle later on. (This, actually, is not true. Your manager would be terminating you, not me, so feel free to chat with me and share your Christmas candy.)

So, here's the deal. You may get laid off. Yes, I know, you are a stellar performer and your boss loves you and blah, blah, blah. Humor me. You may get laid off. And here's the kicker: You will still have bills to pay.

My company offers severance. Yeah! Severance checks come in the mail, not direct deposit. (Yes, I've tried to change that. No, payroll wasn't interested. They said it was a systems thing. I like to get paid, so I said I believed them and now we're all happy together.)

Two pay days in a row I've gotten a tearful phone call from a woman. It seems that the US mail did not deliver her check on the day expected. How could she pay her bills? Her car was going to be repossessed if she did not have that check TODAY.

I can't control the US post office. (Wouldn't that be cool if I could, though? That would be some serious super powers if I could do that.) I also can't guarentee you'll have a job. I can't guarantee that your company will give you severance. (I can't even guarantee that my company will give you severance, largely because you don't work for my company.)

If a check being one day late will be the death of you financially, you need to get control over your financial life. Nobody should be living this close to the edge. I know now is not the best financial time, but please, think about the very real possibility that your check may be worse than one day late--it may not come at all if your job goes away.

I really feel for the woman who is having post office problems. I do. And that's why I'm writing this. Please, put aside some money. Stop spending as if you'll always have tons of cash. If you say, "But I can't put anything aside!" Stop and think about what you'll do if you do get laid off. You are better off now then you will be then, so do something to put a little aside. A little can grow into a lot if you just leave it alone and add a little each pay day.

It'll make it a lot easier on all of us when your manager calls you into his office.

Monday, December 08, 2008

Leave Policy Missing In Action

A long-time employee went out on sick leave a couple of months ago, and has recently expressed the intention of remaining on leave for the next six months. The person is genuinely unable to work and has indicated informally that a return to the workforce is unlikely even though the health condition involved does not reduce life-span. I have received mixed messages from HR about what options are available to this employee and/or to me as the supervisor. For example: Can this individual remain on the payroll collecting sick leave until the leave runs out? When the paid leave runs out, can unpaid leave be continued for another three months under FMLA? Under what circumstances can an employee with sick leave available but no intention of returning to work remain on the payroll?

I don't really have any answers for you, so I'll just use your question as a jumping off point for a good rant.

Mixed messages? Are you kidding me? I mean, seriously people, this is HR 101. You must have a leave policy in place. It should contain, at minimum, the following information:

  • Number of days an employee can take as sick leave before going on short term disability
  • Number of company paid sick days (or if unlimited, then number of days before disability is required)
  • FMLA policy (make sure this is compliant with both Federal and State laws--some states are more generous)
  • At what point an employee is terminated (after FMLA expires? At 6 months? At one year?)
  • How all this fits with your disability (short and long term) policies
  • Under what conditions a manager is allowed to hire a temp or contractor to fill the duties

  • See, that's not so hard, right?

    I mean, geesh, does HR think that no one is going to get sick? (Because that NEVER happens, right?) They should have a policy and every HR person in the company should be able to spout it out to you, consistently and clearly. (Okay, not every HR person. I don't think the HRIS people should have to know--strike that, of course they should, as they control the system that indicates whether someone is active or on leave. ALL HR PEOPLE SHOULD KNOW THIS. Well, maybe compensation...)

    If you don't have a policy, managers are left not knowing what to do. Then managers have to wing it. Then Manager A wings it differently than Manager B and Bob gets great leave at full pay and Maria gets terminated as soon as FMLA expires and she didn't get paid during that time frame either. What happens when Bob and Maria (I'm feeling reminiscent of Sesame Street right now) run into each other in the grocery store? (Oh Bob is a person in your neighborhood, in your neighborhood, in your neigh-bor-hood!)

    Bob: Oh, Maria, I heard you were sick. Me too. I've had these persistent migraines. I'm so thankful that I'm still getting paid.

    Maria: What?!?!!??! (then a few chosen expletives, which I won't write because I don't say such words.)

    Bob: What are you so upset about?

    Maria: I haven't gotten a check in 4 months and they terminated me 4 weeks ago.

    Bob: That's strange, I've been out longer than you have.

    Maria: Excuse me, I have to go call my attorney.

    Is this what you want happening? No. No, you don't.

    Now, my real guess is that there is a policy, it's just that your HR department is unorganized and inconsistent. Escalate this issue. Get your boss involved. There should be clear guidance. This should not be an area for manager discretion.

    Thursday, December 04, 2008

    Some Good E-mail Advice

    There are somethings you should never put in an e-mail. Death by Email gives us a list. Some samples:
    Is this actually legal?
    We're going to do this differently than normal.

    All of us HR types need to be aware of these things.

    Wednesday, December 03, 2008

    Relocated and Laid Off

    I was recently relocated across the country for a position at a better company (leaving behind a good paying, secure job that my heart was no longer in). I was worried about the immediate future of the company (lots of merger/buyout talks) and said I didn't know if I could take the position because I was upside down on my house and would take a big hit selling. The HR person told me that my contract spelled out the severance package if the company was bought out and that there would be no layoffs for at least the next 6 months. I figured that 6 months would allow me to cover the hit on my house if I got laid off and give me enough time to prove my skill set. However, after 3 months, they announced layoffs and I was let go. Is there recourse that I can do other than accept the severance package (much smaller than if the company got bought) and be upset?

    I would not have accepted the job had I known that layoffs would occur this soon and I was even promised that they would not. It was just not written in my contract, just expressed verbally. Also, they paid relocation, and if I left within the first year, I had to pay back a pro-rated amount. Does that impact my at-will status since if I chose to quit willingly I would take a financial hit? They told me it had nothing to do with performance, I just knew the least about the business model itself compared to my teammates, which makes sense, because I was told to expect a 3-6 month learning curve.

    Once again, I must point out that I am not a lawyer. And even if I was a lawyer (which I'm not), I don't know what state you are in. But, in my non-lawyerly way, I'd tell you to pick up the phone book (does anybody do that anymore? Okay, go to Google.) and find yourself an employment lawyer.

    In some states a verbal promise is as good as a contract. (I believe, remember, not a lawyer!) Even if it's not, it would be worth it to get a lawyer's opinion on this.

    I would ask for more severance. I would ask for, at minimum, what you were promised in case of a buy-out. In fact, I would ask for more because of false promises. Talk about a stupidly short-sighted company. (I know, I know, who could have predicted the sub prime mortgage market would collapse and spread into all areas of the economy? Oh, that's right, everyone with half a brain could have predicted it, except for the people who actually dealt in sub prime mortgages. Go figure.) Only in the rarest of circumstances should a company do a position elimination for someone who has only worked there for 3 months. I say, if a position needs to go, it should be the manager who was fool enough to hire someone he wouldn't have work for in 3 months.

    Sorry, a bit ranty today. I don't often say this, but I honestly say you should contact a lawyer. Don't look to win the employment law lottery. It's not worth that. But a nicely worded letter or phone call from your attorney to the legal department of your company may be quite effective.

    This is one of the times I say don't sign the release that is undoubtedly part of the severance offer until it's been reviewed by an attorney. Make sure that your full relocation costs are covered as well.

    Good luck on the job hunt. Don't let this get you discouraged.

    Tuesday, December 02, 2008

    You Make More Money???!?!?!?!?

    Two managers were socializing outside of work. Yes, alcohol was involved. Manager one said to Manager Two: Hey, I know what you make. Manager one then quoted – to the penny – what Manager Two’s salary was. Manager One said that he had seen the information in an offer letter on the HR Manager’s desk (that’s me). Manager two then said: OK, so now that you know my salary, I want to know your salary. Manager One then disclosed his salary amount.

    There are obviously a couple issues here, but the plot thickens. It turns out that Manager One makes quite a bit more than Manager Two, even though their positions are somewhat equal. (There are major wage equity issues here that I am battling). Manager Two is devastated, and has done an amazing job of turning his department around and building his team. This really took the wind out of his sales.

    My issue is with Manager One. While I am at fault for leaving something confidential on my desk, I have a huge issue with Manager One disclosing this. Managers are exposed to confidential, sensitive information all the time, so the expectation is that he keeps his mouth shut. This is also covered very clearly in our policies. If he disclosed this after a couple drinks, what else is he saying?

    When Manager Two disclosed this to me, he stated that he was asking for advice and simply wanted to vent. As an HR professional, I am well aware that there are some topics that employees CAN NOT ask me to keep confidential, and I believe this is potentially one of them. However, since it took place outside of work, are we in a position to talk with and potentially discipline Manager One?

    I'll start my reprimanding with you--bad of you to keep confidential info in a place where others could see it. But, you know that.

    Then I'll reprimand the company for having pay inequities. Now, I'm somewhat of a radical when it comes to pay. Hold on to your horses, but I don't think pay should be confidential.

    Let the ranting begin. Let me state my case. I've been in HR a long time and in every HR position I've ever held--including when I was a temp admin--I've had access to everyone's salary. And I mean everyone's salary. CEOs and co-workers included. It's always been part of my job. At first it's fascinating. Now? Not so much.

    And that's part of why I'm opposed to secrecy. None of this would have mattered if your company was open about such things. (I know of no companies (government jobs excepted) that are open about such things--I am, as I said, an HR extremist. I wonder if that's like extreme sports: Up Next, Evil HR Lady in the Extreme Compensation Policy competition!)

    But the real reason I'm opposed to secrecy is because secrecy allows pay inequities like the one you are dealing with now. Just think--if everyone's salaries were open managers would never hire people at unfair levels or offer big bumps to people they *like* but who hadn't earned the increase.

    I realize there are whining problems with this and it takes a lot of guts to have people know that their co-worker with the same title makes more money than they do, but that just means that the company truly needs to pay for performance. Rational people understand that. Irrational people, you don't want working for you.

    But, now to your situation (clearly, I just hijacked my own blog!). Can you "punish" manager one for something he did outside of work? Sure! Do you want to go there? No. I don't. But, what I would recommend is this:

    HR: So, Manager 1, I understand you had a talk with Manager 2 about salaries. Just couldn't keep quiet about how yours is so much better, right?

    Manager 1: So what? (If he's defensive, that is. If he realizes he was a drunk idiot, he'll hang his head and apologize.)

    HR: Yeah, so it was a pretty stupid thing to do. I'm not sure this company can trust people who make stupid decisions, inside or outside of work.

    And then I'd end the conversation. If you are respected and valued enough it will freak him out just a little bit.

    As for confidentiality, you're neither a priest nor a lawyer. Some things you are required by law to act on, but stupid managers who reveal salary information is not one of them. (In my non-lawyer, non-legal advice way. Entertainment, people, this blog is pure entertainment. In fact, did I tell you my favorite joke. It goes like this: There was a snake named Nate...)

    I would also bust my buns to deal with the salary inequities, starting with Manager 2. You say he's turned his group around. You better make sure he's rewarded for it, or you are going to lose him. You may already lose him. I can guarantee if I was manager 2, I would have come home and started working on my resume. I've just been told that my company doesn't value me. I'd expect the burden is on the company to prove otherwise.