Regulation of Employment- BUL6444

Regulation of Employment- BUL6444 - REGULATION OF...

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REGULATION OF EMPLOYMENT PART A: EMPLOYEE PROTECTION I. FEDERAL SOCIAL SECURITY ACT A. OVERVIEW The Social Security Act provides for several different types of INSURANCE coverage. These include: (1) old-age, survivors, & disability coverage; (2) hospital insurance; and (3) unemployment insurance. B. FEDERAL UNEMPLOYMENT TAX ACT (FUTA) 1. financed through payments made by employers only. 2. payments made under both state and federal law. 3. employers get a credit against federal unemployment tax for payments made to a state fund. 4. payments are deductible as a business expense to the employer. 5. payments are includable in income of those who collect unemployment compensation. 6. self-employed individuals do not have to comply. 7. to be eligible to collect benefits, the unemployed must be: a) involuntarily unemployed (didn’t quit) b) unemployed through no fault of their own c) available for employment C. FEDERAL INSURANCE CONTRIBUTIONS ACT (FICA) 1. OSDH is financed through the Federal Insurance Contributions Act (FICA). 2. BOTH employers and employees pay the FICA tax: a) the employer must withhold the employee’s share b) the employer can deduct payments made on the employee’s behalf as a business expense. c) the employee can not deduct their share for income tax purposes. 3. Limitations: a) maximum rate for employer and employee is the same. Verify. b) maximum wage base - verify 4. SELF- EMPLOYED persons must pay both the employer’s and employee’s share. 5. SELF-EMPLOYED persons may deduct 1/2 of their FICA tax for income tax purposes. 6. To qualify for coverage under the act, a person must qualify as an employee and their compensation must qualify as wages . a) an “employee is someone who is under the control of the employer (i.e., not an independent contractor)
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b) Wages include: all remuneration for employment, including bonuses, c) Wages does not include: employer-paid retirement benefits, insurance premiums paid by the employer. 7. Benefits: a) a “fully insured” individual is eligible for : (1) survivors benefits for dependents (2) benefits for the dependents of retired/disabled workers (3) lump sum death benefits (4) old age retirement benefits b) a “currently insured” individual is eligible for all of the above except old age retirement benefits. c) Benefits are based on average monthly earnings of the employee & cost of living adjustments. d)
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Regulation of Employment- BUL6444 - REGULATION OF...

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