dritson

Employment Law with Daniel Ritson

Summary:

In this week’s episode of Attorney Talk, Ken Thayer interviews Daniel Ritson, an attorney who practices in New York and New Jersey in the areas of employment law, council, and litigation. Daniel also handles employee benefits, executive compensation, and provides advice to employers on a myriad of employment-related matters including wage and hour compliance, family and medical leave policies and practices, independent contractor relationships and issues, the hiring and discharge of employees, and compliance with federal and state discrimination and retaliation laws.

Daniel regularly practices before the federal courts with disputes against government agencies including the IRS, the Equal Employment Opportunity Commission, the US Department of Labor and Fair Trading, and various other departments of state and labor.

In this episode, Ken and Daniel discuss employee benefits and executive compensation, the Affordable Care Act, wages and hours issues, employer mistakes, employee benefits, preferred compensation, and retaining an attorney on a new employee contract.

MAIN QUESTIONS ASKED:

  • How does a lawyer fit into employee benefits and executive compensation?
  • Is the tax element part of the practice?
  • Is your legal representation for the employee or employer?
  • What are the main issues or concerns when clients have to deal with employee benefits?
  • Are there answers to the Affordable Care Act?
  • Is the IRS being cooperative when questions come up with the Affordable Care Act?
  • Is the heath care benefit the main sticking point when it comes to employee benefits?
  • How do you interact with the other government agencies such as the Equal Opportunity Commission and Department of Labor?
  • What are the wage and hours issues, and how is it audited?
  • When do you get involved when the DOL announces an audit on an employer?
  • Are DOL matters arbitrated or litigated?
  • What dictates the benefits that are provided to the employees?
  • What differentiates between your employee compensation and executive compensation, and why are they treated differently?
  • What is your advice to an individual who is an executive and has a new employment offer? Should they retain an attorney?
  • What kind of responses do you get from employers when it comes to executive compensation matters?

 

KEY LESSONS LEARNED:

Employee Benefits and Executive Compensation

  • This is employment-based tax work governed by the internal revenue code.
  • A lawyer fits in on the side of the employers to help them ensure their benefit and compensation plans are compliant, and that they are getting the best tax outcomes from those things and avoiding disputes with the federal department of labor or IRS.
  • The executive side offers counseling to executives in terms of executive compensation, because of the tax ramifications.
  • The other side is offering tax advise to the executive on things such as equity.

Affordable Care Act

  •  The biggest issue is understanding and getting caught up on the Affordable Care Act.
  • The questions are coming in now due to this being the first tax season when forms for the Affordable Care Act need to be filed.
  • At this point, there are more ‘best practices’ than answers, as there are areas that are still being fleshed out.
  • There has been a tremendous effort from the IRS with guidance on the Affordable Care Act.

Wage and Hour Issues

  • This is in relation to audits.
  • Both federal and state departments of labor perform random audits of employers to ensure wages and taxes are being paid properly.
  • On a state level, this usually means unemployment insurance contributions.
  • The most common issue is the classification of independent contractors versus employees.
  • A wage and hours audit is often the result of an employee’s or competitor’s complaint.

 Employer Mistakes

  • One of the biggest mistakes that employers make is that they look at the wages, hours, and taxes as an accounting issue.
  • Accountants may have a handle on the numbers but not on the law.
  • If DOL matters turn to litigation, that generally means being in front of an administrative law judge.
  • Daniel encourages people to work things out within the structure of the agency before it goes into someone else’s hands to decide.

Employee Benefits

  • Any policy is always subject to the governing plan documents such as pension plans.

Employee Compensation Vs. Executive Compensation

  • The phrase often used is ‘similarly situated employees.’
  • A worker on the assembly line is not going to be similarly situated to the CFO.
  • Executives are more in demand and not as easily replaced.
  • There is more an incentive to offer executives benefit plans and compensation arrangements that will cause those individuals to want to stay with the company.
  • This spills over into vesting arrangements based on years of service, with the goal being to keep that person from taking their expertise elsewhere.

Retaining an Attorney on a New Employment Offer

  • An executive compensation attorney will know what is out there in terms of the options.
  • The bigger issue is the tax consequences on employment, which offers that, in particular, the executive compensation arrangements involve preferred compensation.
  • The tax ramifications can be substantial, and not due to employer malice.
  • The whole point of offering the plans is to make employees happy, so employers are often open to negotiation if they want the employee.

Deferred Compensation

  • This is compensation that the employee receives in a deferred over a period.
  • The concern is when it comes to the IRS code 409A that says if you are going to defer compensation, it has to be done in certain ways and has to be memorialized. If done wrong, the results are substantial taxes and penalties.

 

LINKS TO RESOURCES MENTIONED:

973-650-6245

dritson@waschritson.com

 

CLICK TO TWEET:

How does the Affordable Care Act affect employment law? Find out w/ Daniel Ritson @gaylordpoppllc http://www.gaylordpopp.com

 

What is it like to be an employment lawyer? Find out w/ Daniel Ritson @gaylordpoppllc http://www.gaylordpopp.com               

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