There are many requirements that Minnesota business owners must fulfill in order to have employees. Noncompliance with federal and state regulations can get a company in big trouble.
According to Intuit Inc., here are some of employers' legal and tax obligations:
- Apply for an IRS employee identification number; this number is necessary before an employer can legally hire workers
- Verify employee eligibility through the I-9 form; employees must prove that they are authorized to work in the U.S.
- Classify workers as employees or independent contractors
- Report information on the new employees to the state directory within 20 days of hiring them
- Post information on workers' rights
The U.S. Small Business Administration notes that there is also a plan an employer must make in order to pay employees.
- Develop pay period schedule for coordinating IRS tax withholdings
- Plan for compensation for sick leave, vacation and holiday pay
- Choose whether to use an in-house or outside service to administer payroll
- Set up recordkeeping to maintain records on file for the required amount of time
- Prepare to report payroll taxes
One of the employee benefits California employers must pay is disability pay. In addition to disability insurance, employers should determine whether they need to purchase unemployment insurance and workers' compensation insurance.
Some companies offer incentive programs such as stock options, company events, flex time, corporate memberships and wellness programs. Since these programs may be key to drawing and keeping essential talent, they should be set up and tracked carefully.
Creating an employee handbook that includes workplace requirements, employee benefits and other policies and procedures is another essential component of having employees.