FPC Exam - CORE PAYROLL CONCEPTS
What is an Employee? - Answers -Anyone who performs services for an employer when
the employer controls what work is done and how it is accomplished.
What is a Common-Law Employee? - Answers -Gives employers guidelines to
determine whether an individual is an employee or independent contractor. Done by
examining the business and worker, the level of control each has in how work is done
and where.
What is an Independent Contractor? - Answers -An individual who has control how the
work is done. The "payer" merely assigns a task but has little control over how it is
done.
What is a Statutory Employee? - Answers -Workers come under common law rules and
are independent contractors by statute for employment tax purposes if they fall within
any one of several categories: 1) Drivers delivering laundry, product, baked goods,
beverages (NOT MILK) if the driver is paid on commission. 2) life insurance sales agent
who works full time and whose main business is selling life insurance. 3) an individual
who works at home on employer supplied goods on work that must be returned to
employer.
What is a Statutory Non-Employee? - Answers -these employees fall under two
categories: either real estate agents and direct sellers. These are viewed as self
employed if: 1) all payments for their services are directly related to sales instead of
working a certain number of hours. 2) a written contract guides what services they
perform and specifies that for tax purposes they will not be treated as employees.
What are Temporary Help Services and Personnel? - Answers -Employees hired
through an agency on a temporary status.
What factors should be considered before hiring a temporary employee service? -
Answers -1) how are personnel being tested or evaluated? 2) The firm with the most
skilled employees is likely to have an aggressive recruitment system. 3) Does the
service have a solid track record and financial stability? 4) Is the quality of work by the
temporary employee checked? 5) Are temps trained with specific skill?
In determining legal obligations with respect to workplace discrimination, an individual
would be considered an employee of both the staffing agency and the agency's client to
which he's assigned when... - Answers -the staffing agency is a temporary employment
agency.
, Difference between employee leasing and temporary agency - Answers -If the
employees are sent back to the leasing agency for reassignment, then this is a
temporary agency. Leasing agency's are used to supply the management of certain
functions. i.e. human resources, payroll, benefit administration.
What is the 8 and 80 system? - Answers -This generally applies to hospitals and other
healthcare institutions. Allows for these organizations to utilized a fixed work period of
14 days as opposed to the 40 hour work week for computing overtime. Employers will
pay time and a half for hours worked over 8 hours in a day or 80 hours in a 14 day
period.
Be able to Calculate the 8 and 80 overtime system: - Answers -pg 17 momentrix
Overtime Compensation for working two different jobs - Answers -pg 17 momentrix
How do you calculate employee's regular rate of pay? - Answers -NOT THE TAKE
HOME PAY. The formula to calculate regular rate of pay: pay amount for a
workweek/number of hours worked (not including overtime)
What is the Biweekly rate of pay? - Answers -The biweekly rate of pay of the employee
is the regular rate of pay. For salaried: annual salary should be divided by the number of
weeks to be paid and multiplied by 2 for the biweekly rate of pay. Hourly is calculated as
the pay amount for the workweek/number of hours worked.
What are the requirements for changing a workweek? - Answers -A workweek is
defined as fixed and regularly recurring 168 hour period or seven twenty-four-hour
periods that occur consecutively. This period does not necessarily match the calendar
week. Changes can be made but must be permanent and follow guidelines established
by the FLSA
What are compensable time periods? - Answers -Under FLSA employers are not
required to provide employees with paid meal and rest breaks. If an employer requires
one hour meal periods, employees must be free from all duties associated with his or
her job for it to be considered bona fide.
What rule is followed for rounding work time? - Answers -The FLSA establishes that
between one and seven minutes of an hour may be rounded down. But eight to fourteen
minutes bust be rounded upwards.
What is the federal minimum wage? - Answers -$7.25/hour
When are employers subject to FLSA? - Answers -Two tests must be met. The scope of
the employers trade is one test and the other refers to the annual sales amounts that
the business takes in. All employees are covered under FLSA if these tests are met and
those employees must be classified under the FLSA as exempt or non-exempt.
What is an Employee? - Answers -Anyone who performs services for an employer when
the employer controls what work is done and how it is accomplished.
What is a Common-Law Employee? - Answers -Gives employers guidelines to
determine whether an individual is an employee or independent contractor. Done by
examining the business and worker, the level of control each has in how work is done
and where.
What is an Independent Contractor? - Answers -An individual who has control how the
work is done. The "payer" merely assigns a task but has little control over how it is
done.
What is a Statutory Employee? - Answers -Workers come under common law rules and
are independent contractors by statute for employment tax purposes if they fall within
any one of several categories: 1) Drivers delivering laundry, product, baked goods,
beverages (NOT MILK) if the driver is paid on commission. 2) life insurance sales agent
who works full time and whose main business is selling life insurance. 3) an individual
who works at home on employer supplied goods on work that must be returned to
employer.
What is a Statutory Non-Employee? - Answers -these employees fall under two
categories: either real estate agents and direct sellers. These are viewed as self
employed if: 1) all payments for their services are directly related to sales instead of
working a certain number of hours. 2) a written contract guides what services they
perform and specifies that for tax purposes they will not be treated as employees.
What are Temporary Help Services and Personnel? - Answers -Employees hired
through an agency on a temporary status.
What factors should be considered before hiring a temporary employee service? -
Answers -1) how are personnel being tested or evaluated? 2) The firm with the most
skilled employees is likely to have an aggressive recruitment system. 3) Does the
service have a solid track record and financial stability? 4) Is the quality of work by the
temporary employee checked? 5) Are temps trained with specific skill?
In determining legal obligations with respect to workplace discrimination, an individual
would be considered an employee of both the staffing agency and the agency's client to
which he's assigned when... - Answers -the staffing agency is a temporary employment
agency.
, Difference between employee leasing and temporary agency - Answers -If the
employees are sent back to the leasing agency for reassignment, then this is a
temporary agency. Leasing agency's are used to supply the management of certain
functions. i.e. human resources, payroll, benefit administration.
What is the 8 and 80 system? - Answers -This generally applies to hospitals and other
healthcare institutions. Allows for these organizations to utilized a fixed work period of
14 days as opposed to the 40 hour work week for computing overtime. Employers will
pay time and a half for hours worked over 8 hours in a day or 80 hours in a 14 day
period.
Be able to Calculate the 8 and 80 overtime system: - Answers -pg 17 momentrix
Overtime Compensation for working two different jobs - Answers -pg 17 momentrix
How do you calculate employee's regular rate of pay? - Answers -NOT THE TAKE
HOME PAY. The formula to calculate regular rate of pay: pay amount for a
workweek/number of hours worked (not including overtime)
What is the Biweekly rate of pay? - Answers -The biweekly rate of pay of the employee
is the regular rate of pay. For salaried: annual salary should be divided by the number of
weeks to be paid and multiplied by 2 for the biweekly rate of pay. Hourly is calculated as
the pay amount for the workweek/number of hours worked.
What are the requirements for changing a workweek? - Answers -A workweek is
defined as fixed and regularly recurring 168 hour period or seven twenty-four-hour
periods that occur consecutively. This period does not necessarily match the calendar
week. Changes can be made but must be permanent and follow guidelines established
by the FLSA
What are compensable time periods? - Answers -Under FLSA employers are not
required to provide employees with paid meal and rest breaks. If an employer requires
one hour meal periods, employees must be free from all duties associated with his or
her job for it to be considered bona fide.
What rule is followed for rounding work time? - Answers -The FLSA establishes that
between one and seven minutes of an hour may be rounded down. But eight to fourteen
minutes bust be rounded upwards.
What is the federal minimum wage? - Answers -$7.25/hour
When are employers subject to FLSA? - Answers -Two tests must be met. The scope of
the employers trade is one test and the other refers to the annual sales amounts that
the business takes in. All employees are covered under FLSA if these tests are met and
those employees must be classified under the FLSA as exempt or non-exempt.
