The HIdden Costs of Hiring Compliance

How Will You Avoid The Hidden Costs of Non-Compliance?

Compliance

Immigration Violations

Audits Risk

Tax Form ErrorsFines & Penalties

Delinquent Reporting

Non-Compliance in Hiring is Common

• New hires frequently make mistakes filling out forms

• HR doesn’t always catch errors and omissions

• Deadlines get accidentally missed• Constantly changing laws make it hard

to keep up• Outdated forms are sometimes used• Paperwork gets misplaced


A Few Of The Agencies That May Audit Your Organization Include:

• Immigration and Customs Enforcement (ICE)

• Federal Internal Revenue Service (IRS)

• Your State’s Revenue Service

• State Office of Child Support Enforcement (OCSE)


What ICE May Find In An I9 Audit:


• Missing I9 forms (either not filled out in the first place or not kept

for the required length of time)

• I9s completed incorrectly by new hire and/or employer

• Suspicious I9s that require further investigation

• HR’s failure to follow correct protocol in documenting worker ID

• I9s that list expired work authorization documents

• A pattern of technical/procedural errors in how I9 data is

collected

• Lack of a specific process for handling tentative non-

confirmations

• Discriminatory use of I9s and the E-Verify system

• Evidence that an organization is hiring unauthorized workers

Potential Penalties For I9 Violations


$110-1100 for every missing or incorrectly completed I9 form

Additional fines for systematic failure to collect I9 information correctly

$375-16,000 for every unauthorized worker found to be employed by the organization

Criminal penalties including jail time for business owners, HR executives, and hiring managers


What The IRS May Find In A W-4 Audit:Invalid W-4 forms

Examples of invalid forms include:• Multiple selections of filing status• Alterations to the W-4 form• Selection of a flat $ amount or fixed %

instead of the permissible allowances• Listing a withholding amount and

claiming full exemption

Common Violation: The Employer withholds at a rate other than Single/Zero allowances when an employee turns in an invalid W4 form


Potential Fines For W-4 ViolationsThe IRS may hold the employer liable for any unpaid taxes that should have been withheld under the Single/0 rule for invalid W-4s

EXAMPLE: Employee Jane Doe makes $50,000 per year. She turns in an invalid W-4 that has several items scratched out and rewritten. HR makes an assumption that she intended to list Married with 9 allowances.

As a result, the employer withholds approximately $360 in taxes for the year. The withholding for Single/Zero would have been around $7,800. The IRS can require the employer to pay the balance of $7,440

Additional fines and penalties may be assessed at the auditor’s discretion for the employer’s failure to follow proper withholding procedures.


What The OCSE May Find In A New Hire Reporting Audit:

• Failure to report new hires to the appropriate agency within the time frame (20 days or less) specified by the state

• HR not using a form for reporting that includes all relevant data as required by law

• Not having a process in place to report data at all

• Collusion with new hires to defraud the Child Support system


Potential Consequences For OCSE Violations

• A fine of up to $25 for each late-reported new hire

• A fine of up to $25 per month for each unreported new hire

• A fine of up to $500 for each instance of collusion

• Civil penalties such as suspension of an organization’s business

license

• Contempt of court charges for failure to pay fines in a timely manner Penalties and Fines Vary Greatly By State


SSA/IRS No Match LettersIn addition to penalties for W-4 violations, the IRS may also fine employers $50 for each instance of a mismatch between information submitted on a W-2 and data in the SSA’s system.

Failure to follow up appropriately upon receipt of an SSA no-match letter may also be used as evidence against an employer during an ICE audit.


How To Reduce Your Risk

Implement HRIS Technology That:• Always presents the most current version of each form during onboarding

• Consistently enforces all the federal/state business rules, eliminating errors

• Uses "virtual forms" that cannot be altered or left incomplete

• Automates the flow of documents to the hiring manager for final review

• Integrates with E-Verify to speed I9 verification and ensure new-hires are eligible

• Automates delivery of data to state new hire reporting systems in a timely

manner

• Eliminates re-keying of data from one system to another - reducing typos


Benefits Of Better Compliance • Your organization sends up fewer “red flags” that may

trigger an audit

• If an audit occurs, your risk of civil penalties is reduced because all your documentation is in order

• Taking proactive steps to increase compliance shows a good faith effort that works in your favor if any past errors are discovered


Universal Onboarding from Emerald Software Increases Hiring Compliance

Here are just a few of the features that will boost your compliance level• Onboarding - Forms Automation • "Instant" Implementations (Demographics, W4, I9, State Tax, etc.) • Federal Forms Included in Library: W4, I9, 8850, and more• State Forms Included in Library: All State W4s or equivalents • Electronic Signature Images (including signature images)• E-Verify interface (Department of Homeland Security) • State New Hire Reporting• User-definable Business Rules on Data Panels• Post-forms submission Integration to User Definable Workflows

(BPM)


Contact Us Today To Learn More About Universal Onboarding

www.emeraldsoftwaregroup.com

3060 Royal Blvd SouthAlpharetta, GA 30022

Phone: 770.569.5122 Fax: 678.669.1516

http://www.emeraldsoftwaregroup.com/