IRS Announces 2006 Cost of Living Adjustments

The Internal Revenue Service recently announced the 2006 annual cost-of-living adjustments for pension benefits and contributions to retirement plans:

1) The maximum deferral to 401(k) plans will increase from $14,000 in 2005 to $15,000 in 2006;
2) Catch-up contributions under EGTRRA for employees 50 and older will increase from $4,000 to $5,000;
3) The compensation limit under Code Section 401(a)(17) increases from $210,000 in 2005 to $220,000 in 2006;
4) The annual addition contribution limit under Code Section 415 for individuals in 401(k) plans increases from $42,000 in 2005 to $44,000 in 2006;
5) The highly compensated employee limit under Code Section 414(q) is increased from $95,000 in 2005 to $100,000 in 2006;
6) The limit used in determining key employees under Code Section 416 is increased from $135,000 in 2005 to $140,000 in 2006; and
7) The Social Security Wage Base (maximum earnings taxable) for 2006 is $94,200.

Telecommuter Gets Hit with Tax

Bad News for Out-of-State Telecommuters

Recently, a Tennessee man was ordered to pay taxes on his income by New York's highest court, even though he only works in New York 25% of his time. Thomas Huckaby, a computer specialist who spends the other 75% of his time in his home state, discovered that he will be taxed by both Tennessee and New York. As reported on HR.BLR.com:

"A New York State tax-department rule states that people who live out of state, work for a New York employer, and occasionally come to New York on business must pay taxes, even on work performed out of state, according to The Wall Street Journal. The only exception to the state's rule would be if the out-of-state work was done for the employer's "necessity". The New York Supreme Court ruled, in a 4-3 decision, that Huckaby had to pay taxes on all of his income."

As revealed in a recent Telework Advisory Group survey, there are approximately 9.9 telecommuters in the United States who now may face this additional tax. However, there is proposed legislaton, the Telecommuter Tax Fairness Act that would prohibit the practice of taxing telecommuters for work completed in another state.

According to The Wall Street Journal, Senator Dodd (D-CT) called Monday's decision "disappointing" and said it "underscores the need to take action on the legislation that I have introduced… Telecommuting reduces traffic congestion, reduces pollution, and helps businesses strengthen their bottom line. The current rules punish telecommuters rather than reward them and that needs to change."

How to Help Your Employees Avoid the Flu

canadian hr reporter - article display

Flu season is upon us, but there are ways to help ensure that your work environment stays happy and healthy. The Canadian HR Reporter offers the following tips from Trish Stenson, Director of Clinical Services at Ceridian Canada:

- Encourage employees to get a flu shot from their doctor or set up a program in conjunction with health professionals for employees to get their shots at the office

- Provide employees tips on how to prevent getting the flu

- Encourage employees to stay home if they are sick, especially if their symptoms are flu-like

- Provide handouts on how to wash hands properly

- Provide hand sanitizers in washrooms and other places.

- Promote work-life balance by encouraging employees to take their lunch breaks, step away from their desks periodically to de-stress, and pay attention to eating nutritious food and getting physical activity

- If snacks are a part of the office environment, make sure healthy snacks are available to counter the popular high-sugar content treats

- Discourage the sharing of keyboards, headsets, etc. by providing each employee with his/her own equipment

Stenson stresses that the most important tip is to encourage ill employees to stay home. "Not only does coming to work put co-workers at risk, but work productivity suffers and sick workers are often unable to focus on the tasks at hand," said Stenson.

Survey Reveals that More than 40% of American Workers Plan to Find New Employment Within Next 12 Months

A recent Yahoo! HotJobs online survey revealed that a large percentage of U.S. workers are planning on looking for new opportunities in the near future. The poll results show that more than 40% are planning on looking, while 21% are already looking for new positions.

The number one reason for seeking out a new job opportunity is the desire for a better compensation package (96%)

Additional reasons for wanting to leave include:
- Believing that there is no potential for career growth in current position (44%)
- The desire for a better commute (18%)
- Feeling that they are not being "valued" by current employer (25%)
- The desire to work in an environment with higher morale (29%)

Yahoo! HotJobs VP of marketing and career expert, Marc Karasu, was quoted in their press release as saying, "Employees are sensing more opportunities and better total compensation packages, and they're making plans to go after them. Current employers should take stock of their own talent acquisition and retention models as they prepare for their staffing needs for 2006."

Have you reviewed your own recruitment and retention programs? Now is the time!

"North Country" Displays Accurate Portayal of Real Life Sexual Harassment Case

The Capital Times

The recent, critically acclaimed film, "North Country," starring Academy Award winner, Charlize Theron, depicts the story of the first sexual harassment class action law suit in the United States. It serves as an excellent reminder that workplace harassment can easily occur, and we must be aware of potentially dangerous situations. As Judy Ettenhofer explained in the Capital Times...

"North Country" is based loosely on the first sexual harassment class action suit brought in the United States, by the women "rangers" working at the Eveleth iron ore mine in northern Minnesota's Mesabi Range.

In real life, Lois Jenson and her fellow female rangers endured nine years of abhorrent harassment from the mine's male employees before Jenson filed a complaint in 1984. A lawsuit grew out of that complaint, finally gaining class action status in 1991. The case dragged on until it was finally settled in 1998, but along the way it helped push employers to institute policies against workplace sexual harassment.

What is shocking is that throughout the 1980s and 1990s many corporations resisted the pressure of instituting anti-harassment policies. Today, there have been many improvements regarding sexual harassment in the workforce, but we must still keep our eyes open for inappropriate behavior.

Honor Veterans as Part of Your Diversity Efforts

As recently pointed out in SHRM's HR Week newsletter, our nation's veterans are often overlooked in organizations' diversity programs, even though one in every eight Americans (13%) has served long enough in the military to be considered a veteran.

SHRM suggests making an effort to recognize the veterans in your workforce making a special effort to honor them on Memorial Day and Veterans Day. In addition, you can incorporate a recognition campaign with your recuiting initiative. There are also a number of resources that can be extremely helpful in your endeavors:

Free Veterans Day Observance Posters (also Downloadable)
http://www1.va.gov/opa/vetsday/gallery.htm

Hiring Information:
HireVetsFirst
http://www.hirevetsfirst.gov/

Military Talent, Civilian Careers
http://www.taonline.com/

Veterans and Transitioning Military Personnel
http://www.rileyguide.com/vets.html

U.S. DOL's Hiring Veterans
http://www.dol.gov/dol/topic/hiring/veterans.htm

For more information on diversity:
SHRM's Diversity Toolkit
http://www.shrm.org/diversity/DiversityToolkit.asp

Be sure to visit the SHRM site for a wealth of additional information.