Tuesday, January 31, 2012

Crackdown of Tax Refunds & Identity Theft Criminals

The US Department of Justice and the Internal Revenue Services have launched a crackdown of Identity Theft Scammers. Particularly, this action was meant to protect taxpayers who will become victims of Tax Refund Frauds and Identity Theft during this tax season.

“The Justice Department is working closely with the IRS to investigate, prosecute, and punish tax refund crimes committed through the theft of identities,” said Principal Deputy Assistant Attorney General John A. DiCicco of the Tax Division. “Now, more than ever, we must remain vigilant against the unauthorized use of identification information to defraud the U.S. government.”

The map below illustrates the locations where this crackdown took place since last week.

Source: irs.gov/identitytheft

"The coast-to-coast effort took place over the last week and included indictments, arrests and the execution of search warrants involving the potential theft of thousands of identities and taxpayer refunds. In all, 939 criminal charges are included in the 69 indictments and informations related to identity theft."

“This unprecedented effort against identity theft sends a strong, unmistakable message to anyone considering participating in a refund fraud scheme this tax season,” said IRS Commissioner Doug Shulman.

These actions are great efforts by both government offices.  Every action like this will reinforce faith, and confidence of the people to the government who will stand by to protect the vulnerable citizens of the United States.

Great Job!

We like to hear about your insights. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

About JNT Consulting
JNT Consulting Global Resources offers professional consulting and resources management, provides workforce solutions that achieve the "High Performing Organization" regardless of size and location.

JNT Consulting has its headquarters in San Jose, California and is "Your Partner for Growth & Development”, “Your Professional Coach”, and “Your Provider of Global Resources”. You can contact us by calling +1 650 241-3207 or visit our website.

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Required Competencies to solve Global Challenges for Economic Growth and Sustainability

As we sailed into the Year 2012, we are sustaining new Outlooks, new opportunities through various partnerships and cooperations. We are in progress in re-assessing our efforts and revising our Plans of Action to become current, competitive and successful.

From the last quarter of 2011, we implemented a continuous global research, discussions from many of our valued clients, business colleagues and various leaders of global organizations, it brought us the opportunity to examine the challenges that we need to pay attention in 2012. At that time frame, other researches with similar focus were being conducted, thus cross-validated our findings.

Below are some of the highlights and few insights of how to overcome these challenges. In order to be successful in this year, one must have strong global strategic techniques, analytical attention and professional competence in these areas.

1. Cross Culture as Essential Element of Globalization:
It is not merely a recognition of diverse employees and headcount, it is an integration of multi-cultural backgrounds of people, society and community. Learning the nuances and depth of cultural practices and traditions are effective techniques to achieve success in the global economy.

2. Surging Social Media across Cultures:
Globally, there are universal concerns about the role of social media towards advancement of organization. There are also inherent disadvantages towards 'privacy', 'access to technical information', 'utilization of employer's resources', 'use of personal time by the employee', 'social media's role for growth', 'utilization of social media as a tool for discrimination' and many more.

Organizations are challenged about the way they manage social media platforms and its integration in their workplace. Employees enjoy the convenience and flexibility of social media at their fingertips. However, employers see these as factors against productivity of employees. Employment laws are evolving along with the social media phenomenon and each country policy differ across cultures. HR organizations struggle in coping up with the enormity and scope of social media's impact to their workforce.

"The benefits of social media are becoming increasingly obvious to many SMEs, but the medium comes with its own array of risks - unless you develop a robust media policy and thorough staff training, experts say. “It's also critical to have an open culture in the business, so that if something does go wrong, or if a staff member makes a mistake using social media, staff feel comfortable volunteering this information so something isn't left to fester on social media that the business doesn't know about or staff are too scared to tell management about,” says Franklin Adam Franklin, Bluewire Media - Source: Sydney Morning Herald, Managing Small Business.

"HR professionals have to be [technologically] aware. They don't have to be gurus, but they can't ignore it, employees and potential hires use social media to communicate. That includes tweeting or Twitter and posting on Facebook about their jobs and employers". - Josh Bersin, Source: SHRM, Staffing Management

3. Competent Global Consultants Play a Big Role: 
Globalization brings additional tide of flexibility. There are many organizations that are expanding at new locations internationally. Oftentimes, it's their first time to do business at that particular country. For smart organizations, they tap the help or guidance of globally experienced consultants. These consultants demonstrate strong capabilities that inexperienced organizations at a given location cannot ignore.

The convenience is the ability to perform functions with quality deliverables at due time. They strategically approach every item that they contract and perform. That convenience is not available when you hire FTE employees without considering the learning curve to do the job. Although experienced hires can do the jobs, it was found that they were not experienced enough to execute the consultative techniques that professional consultants can do. However, it is not a matter of having a consultant, it is equally important to examine the responsibilities between both parties involved particularly where Employment laws and business regulations might come into play. In that way, your organization will avoid citations, penalties or big legal fees due to violations.

"Using a professional means that the results will be processed effectively and thus, the subsequent recommendations will carry more weight and be more useful. A professional will have the experience to deal with problems throughout the project and therefore, deliver the findings on time." - Source: DJS Research

4. Hiring Top Talents across Cultures:
A tendency of organization when opening at new country was to hire one of their top employees and become an expat. The assumption was that the top employee can play great impact and business opportunities in the new country because he/she was a topnotch employee at the home country. In many instances, this assumption was proven to be wrong based on experiences of many organizations and senior executives.

Today, organizations that are operating at multi-cultural locations are challenged with many facets of host country operations. Unforeseen realities prior to the expatriate assignment surfaced and issues came one after the other. As a consequence of their neglect, they end up losing their investments of time, money, and top notch employee. The inexperienced HR organizations faced tax issues, expatriate management, compliance requirements about local and international laws, host country's culturally based business practices and community traditions. It is important to approach a global expansion with a strategy that demonstrates all areas that will require attention. Working with HR professionals or Human Capital consultants that have worked in multiple countries is very important and not an option, 100 percent of the executives we have spoken agreed.

In a recent Global CEO Survey (1,201 have participated), identified the major challenges in the next three years, they are as follows;
66% - limited supply of candidates with the right skills
54% - recruiting and integrating younger employees into the workforce
52% - losing people to competitors
50% - providing attractive career paths

Identified strategies to meet these challenges are:
65% - using more non-financial rewards as motivation
59% - deploying more staff on international assignments
54% - working with government and academia to improve skills
Source: PriceWaterhouseCoopers Report

The world's borderless workforce, the migration of talent across and within national boundaries, is growing rapidly in size. Employers who take a sophisticated approach to managing their talent supply and demand challenges by including a talent mobility strategy in their overall plan to combat skills shortages will position themselves to win the escalating war for talents. - Source: StaffingIndustry.com

5. People Management across Cultures:
Many speculate that hiring and managing people regardless of location is universal. Our experienced global leaders disagreed with that assumption. Each one identified that one among the failures of organization was the utilization of universal template in regards to hiring people internationally. The practice of hiring talents in the United States cannot be used as a template when hiring talents in Asia, Australia, Canada, and European countries. Each country is different and their people. The executives stressed the demonstration of respect to people at new location. Show respect to the culture and traditions that they are living and integrate your business to them and not the other way around. When hiring individuals for management positions, our executives say they will pick the ones with demonstrable competencies in leadership and cultural sensitivity.

In North America (Canada and USA), 71 percent of the surveyed hiring managers say that "they would put leadership skills as top priority when hiring executives", according to the survey conducted by Right Management. Source: Canadian HR Reporter

6. Becoming the High Performing Organization:
1. Refocusing towards human capital and value their competencies and strengths
2. Reinvigorating leadership, coaching and empowerment
3. Become an executive partner at the table and demonstrate acumen in ROI and competencies in business
4. Competence in analytics and strategic approaches are required - Not only metrics and processes oriented
5. Use pragmatic and practical business practices that are people oriented
6. Transform from traditional and outdated procedures to strategic techniques that integrate culture, competencies, leadership and workforce adaptability

In 2010, an article was published "Competitiveness and Strategic Competence - Differentiator of New HR and Business Partner"

7. Needed Competencies of Human Capital and Resource Management Professional
1. Demonstrate business acumen and practices
2. Integrate values, ethical practices and accountability
3. Execute consultative competencies, strategic organization, critical thinking and solutions
4. Competence in Analytics, R.O.I. driven activities and business decision making
5. Expertise and sensitivity in global and cross cultural effectiveness
6. Develop leadership and communication competence
7. Invest on people as an asset to avoid talent drain
8. Philosophical Competence in Experiential Learning, Relational Partnerships, Collaboration and Evidence-based Management
9. Acquire global competencies if you don't have them through coaching and professional development
10. Continuous learning of the current techniques and practices around the globe

"Today, 40% of HR Directors make it to the boardroom table but up to 50% admit to not knowing the contribution their role makes to other functions and executives across the business" - Source: HR Review, Strategy and Practice

What do these mean to you?
There are lots of strategic actions that need to be done in order to achieve success. Transforming your organizational approach from traditional to strategically enabled (if not happening yet) is essential. Integrating results and R.O.I. driven performance are necessary. Growth, development and sustainability of human capital as assets in the organization are equally important.

The following graph validates readiness of our firm in responding to all of the identified challenges of organizations in the globalized 21st Century. Let us know how we  can bring you, your teams and organization to become the 'High Performing Organization'.
We like to hear about your insights and experience. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

About JNT Consulting
JNT Consulting Global Resources offers professional consulting and resources management, provides workforce solutions that achieve the "High Performing Organization" regardless of size and location.

JNT Consulting has its headquarters in San Jose, California and is "Your Partner for Growth & Development”, “Your Professional Coach”, and “Your Provider of Global Resources”. You can contact us by calling +1 650 241-3207 or visit our website.

Source References:
1 JNTC Articles - http://jntcarticles.blogspot.com
2 Sydney Morning Herald - http://www.smh.com.au
3 The Nation - www.nationmultimedia.com
4 SHRM - http://www.shrm.org
5 DJS Research - http://www.djsresearch.co.uk/
6 PriceWaterhouseCoopers - www.pwc.com/ceosurvey
7 Staffing Industry - http://www.staffingindustry.com
8 Canadian HR Reporter - http://www.hrreporter.com
9 HR Review - http://www.hrreview.co.uk
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Friday, January 27, 2012

Global Leaders of Organizations Need R.O.I. Driven People in HR

(c) JNTConsulting

What do global leaders of organizations like to see in their Human Capital Organization pertaining to the role of Leadership Development?

Juntee Terrenal, MA, GMS, was asked to participate in the above inquiry, and he emphasized;

Management of today's global organization likes to see the R.O.I. of their investments in Leadership Development. Today, organizations operate differently including the composition of the people that combines Baby Boomer and the Millennials, immediate R.O.Is are earnestly on top of the discussions. They like their organization as one of the "high performing organization" in the market. In addition, they like to see capabilities of the whole Human Capital Organization to discuss competently about global business and R.O.I. results of their activities.

2012 organizational leadership likes to see the fastest results on developing potential leaders or enhance the competencies of their existing leaders. However, many do not understand the complexity and learning curve period of developing someone. In addition, the department of Human Resources cannot illustrate the bottom line value, risks and R.O.I. of their endeavors when comes to leadership development, globally.

Today, 40% of HR Directors are sitting at the boardroom table but up to 50% admitted to not knowing the contribution their role makes to other functions and executives across the business units. - Source: HR Review, Strategies and Practice

Juntee suggested, that customized strategies are essential and very relevant to incorporate the value of management's concerns, current shortcomings of people, along with the culture, business acumen and the linkage to R.O.I. Dramatic transformation is necessary (when required) in order to achieve an R.O.I. driven leadership development. Fire those who don't collaborate with a renewed mindset – performance based. The time when people are comfortable with the loosey-goosey day-to-day techniques has past. Leaders must bear a mindset of being entrepreneurial and innovative. The goal is to become the 'high performing organization' and 'competitive' in the market. The questions would be, are you globally competitive in the 21st Century? Is your organization one among the so called the high performing organization? These are the interests of today's senior executive in the global environment.

We all agree that a continuing endeavor to coach individuals is necessary until such time that each demonstrates outstanding competencies. Integrative measurements and performance results must be the active basis of rewards not familiarity and tenure. Accountability is equally important to sustain quality of leadership.

"In today’s business environment leadership development needs to be grounded in real work and focused on the critical competencies required for success" - Source: HR Review, Home Page Leader and Training

Can your Human Capital Organization demonstrate global readiness in responding to those expectations this year?

We like to hear about your insights. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

About JNT Consulting
JNT Consulting Global Resources offers professional consulting and resources management, provides workforce solutions that achieve the "High Performing Organization" regardless of size and location.

JNT Consulting has its headquarters in San Jose, California and is "Your Partner for Growth & Development”, “Your Professional Coach”, and “Your Provider of Global Resources”. You can contact us by calling +1 650 241-3207 or visit our website.

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Wednesday, January 25, 2012

Happy Australia Day, Mate ~

January 26th - Australia Day Celebration

Source: embassyworld.com
Happy Australia Day to all our business partners, friends, colleagues and family members down under!

"Let's commemorate the arrival date of the First Fleet in January 1788"

In May 13, 1787, the so called First Fleet begun sailing from Great Britain (now called United Kingdom), consisting of 10 Civil Officers, 212 marines and officers, 28 wives and 17 children, 81 free persons, 504 convicts and 192 female convicts, total of 1044.

The people aboard in the First Fleet were sent to Australia based on Orders-in-Counsil for establishing the European colony in Australia, in the region of which Captain James Cook, a Royal Navy Captain and a British Explorer, had named New South Wales. The fleet was led by Captain Arthur Philip, who later became an Admiral.  The First Fleet arrived at Botany Bay between January 18-20, 1788

At a later date, the first European Habitation of Australia settled at Sydney Cove. Today, Sydney Cove is relative to Sydney Harbour / Circular Quay. The city of Sydney resides in New South Wales, a province of Australia.

The Australia Day was celebrated since January 26 1908 according to historical records. In 1818 was the first official formation of the celebration held in New South Wales. Currently, it is a public holiday across Australia. During this time of annual celebration when different Australian Awards and Honours are conferred to deserving individuals, groups, institutions and other categories.   Australia Day has become the biggest annual civic celebrations in Australia.

(c) 2011 JNTConsulting

(c) 2008 JNTConsulting

Today, Australia is growing rapidly, according to the Australian Bureau of  Statistics, the population is at; 

The following are JNTC Articles' additional current information about Australia:


We like to hear about your insights. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

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The Synergy of the Year of the Dragon and President Obama's State of the Union

Our positive outlook for this year of 2012 is full of hope and excitement. We have gone through many cross roads, turns, ups and downs in the last years. Indeed we need new perspectives and techniques to challenge our horizons dramatically in order to be more successful in achieving our business, professional and personal objectives.

Courtesy of John Wu

Gong Xi Fa Cai!

The Year 2012 is the 
Year of the Dragon 
and Lunar New Year. 

Chinese calendar has been used for many centuries. It is used to celebrate many East Asian holidays such as Chinese New Year, Spring Festivals, Astrological Events, and the selection of most auspicious date for a wedding or opening a building. These were based on traditions and beliefs relative to one cycle of the moon in a given month.

This year 2012 is the Year of the Dragon (Male Water) which begins on January 23, 2012 and ends on February 9, 2012. The Chinese Calendar which describes about the Lunar Year has been used in three and a half millennia (source: Chinese Historical and Cultural Project).

The Chinese year that begins January 23, 2012 is reckoned in the seldom-used continuously numbered system to be 4709 (or 4649 or 4710), depending on the epoch used. (source: wikipedia.org)

Anticipating the positive aura and energy that the year 2012 will bring.

"There are lots of challenges ahead but everything will be solved through power of knowledge and strategic yet realistic solutions" - said Juntee Terrenal, President, JNT Consulting Global Resources

~  ~  ~

Blue Print for an America Built To Last 

"A Nation Where Everyone Gets a Fair Shot, 
Does Their Fair Share,
and Plays by the Same Set of Rules" 
- Pres. Obama


"There's no reason why we can't restore the basic American promise that if you work hard, you can do well", "We all have a stake in the future success of our country. America is still the place where you can make it if you try. But we cannot fulfill that promise by shortchanging investments in our kids, our workers, our environment and our economy. The America we built after World War II -anchored by a strong middle class -- can be built again. We will do it by restoring an economy that works for all of us" - said President Obama, State of the Union Address, Tuesday, Jan. 24, 2012.

Wishing you all with the best of opportunities that the Year of the Dragon will bring us all.


We like to hear about your insights. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

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Thursday, January 19, 2012

UK - 8.4 percent Increase in Unemployment

Source: FE News/youtube.com
Chris Grayling, UK Minister of Employment announced that the unemployment rate in the United Kingdom increased to 8.4 percent, an unacceptably high, he noted.

He reasoned, that this increase was caused by the large number of people who were moving from economic inactivity but now looking employment. The private sectors are creating opportunities but the public sectors are losing jobs.

However, there are specialized programs and other measures in placed to help the job seekers as support to get employment.

Support the UK Work Programme  - (source: FE News via www.youtube.com)
1. Look at training providers to form partnership with Work Program to create an opportunity of enhancing skills of individuals entering or re-entering workforce
2. Employers can partner with us and get engaged, they are the clients. They need to be the partner in determining the needed skills for a local economy

Source: infoplease.com

Current Challenges to reach the goal:
1. Delivering the right support to the long term unemployed
2. Ensuring simple mechanisms that support young people to move out from college into the workforce
3. Proper focus on filling skills gap solutions to obtain right skills needed and gain experience for those who got the skills but not getting the right employment opportunities

To listen to Chris Grayling's inputs he discussed with the media, please click the "UK Unemployment at 8.4 Percent" - source: http://www.guardian.co.uk.

The UK Work Program has identified areas where all parties involve will need to work together in order to move forward and help each other in changing the current economic landscape and challenges.

The third challenge in reaching the goal of the work program is the key to the success of supporting people who has the skills but not getting the applicable employment opportunity.  Someone was thinking strategically in Mr. Grayling's office, indeed.

America needs these types of strategic techniques to reinvigorate the long term unemployed for the US workforce!

We like to hear about your insights. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

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2012 Australia's Strategy - Integrating Workforce In Focus

(c)2008 jalennturre

Australia's Strategy - Integrating Workforce
In 2012, Australia’s Department of Immigration and Citizenship will review the existing Professional Year Visa Program that was implemented in 2008. It is a structured development program, combining formal learning and workplace experience that was intended for Engineers, Accountants and IT Professionals. It may assist graduates to find employment and credits 5 points towards meeting the Points Based Skilled Migration pass mark.

Source: embassyworld.com

The Scope of the Professional Year Visa Program entails;
  • participants will familiarise with the norms and values in the Australian workplace as well as the Australian employment market and workplace culture
  • participants acquire techniques on how to communicate effectively and professionally in the Australian workplace with colleagues, managers and clients
  • participants will gain an internship (work experience) in order to learn about all aspects of work practices in an Australian company
The intended evaluation was to assess whether the Professional Year Program has been achieving its defined objectives successfully, at the same time to identify potential improvements. The Department of Immigration and Citizenship encourage all current and past students under the program to participate anonymously in the survey.

JNT Consulting in Terrigal, New South Wales, Australia
Our office in Terrigal, New South Wales, Australia commenced in servicing our Australia-based clients through the leadership of our Director, Aldo Vaccarezza. 
Aldo is instrumental to our success in the land of Oz. 

Depending on the results of the evaluation. The program may continue as an integral part of Australia's competitive  program in enriching their workforce through diverse talents from different cultures.  The goals of the program are noble and strategically positioning better relationship among people within Australian workforce environments. A very good approach that will facilitate integrated society and citizens regardless of backgrounds.

Professionals across the globe are competing in expanding their knowledge, skills and competencies. Businesses with operations between two countries or more are struggling in coping up with the expectations of local hosts and increasing their capabilities to adapt into the global world. Many are short of competencies to be adequately comfortable of operating within the auspices of another culture.

We like to hear about your insights. You can email your comments to:info@jntconsulting.com or send through the provided message field at the end of this article.

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Tuesday, January 17, 2012

USA - IRS Launched the Tax Returns e-Filing for 2012

source: irs.gov
Today, January 17, 2012 - the US IRS launched the 2012 electronic tax filing season. Last year, the electronic system revolutionized the processing of tax returns and speedy refunds were possible. More than 112 million income tax returns were e-filed or 77 percent of all individual returns filed electronically. E-filing system will also notify the taxpayer if his/her filing was correct and accepted. Or when declined, it will provide a window of opportunity in re-filing.

"E-file is the best option for taxpayers. E-file enables taxpayers to file more accurate returns and receive their refunds quickly and safely," said IRS Commissioner Doug Shulman.

Taxpayers can get their tax refunds in as few as 10 days. Last year, more than 79 million refunds were electronically deposited directly into taxpayers’ accounts, saving them a trip to the bank and the fastest way to get a refund after e-fling.

What this means for you?

Ideally, electronic e-filing your taxes is convenient and very easy. There are three ways that were recommended by the US IRS on how to file your taxes electronically. They are the following;
1. Through self e-filing by using a tax software e.g. Turbo Tax and similar softwares
2. Through a Tax Preparer
3. Through IRS Free File. However, please note that there is a limitation to the adjusted gross income of $57,000 or less of a given family or an individual when using this system.

When your adjusted gross income is higher than $57,000, consider using either item 1 or item 2 in the recommended ways of e-filing. Don't wait for the deadline on April 17, 2012.

Please click the following links to read more details;

E-filing of Tax Returns Opened

IRS Free E-filing of Federal Taxes

We like to hear about your insights. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

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Sunday, January 15, 2012

Remembering Dr. Martin Luther King Jr. as an American

January 16, 2012 is a US Federal Holiday. It is the day to remember the legacy that Dr. Martin Luther King Jr. has fought for us, being an American. He was born on January 15, 1928 and was assassinated in April 4th 1968. He stood for justice and equality as a civil rights leader.

"We're celebrating the best of what we are, but also what me must become, knowing that we've not arrive there yet," - Martin Luther King III

Dr. King at Tenth Anniversary of the S.C.L.C. in Atlanta, GA in Aug 16, 1967

Dr. King was the chief spokesman for nonviolent activism in the civil rights movement, which successfully protested racial discrimination in federal and state law. The campaign for a federal holiday in King's honor began soon after his assassination in 1968.

Then, President Ronald Reagan signed the holiday into law in 1983, and it was first observed on January 20, 1986. At first, some states resisted observing the holiday as such, giving it alternative names or combining it with other holidays. It was officially observed in all 50 states for the first time in 2000. (source: wikipedia.org)

Several politicians were against the creation of the holiday to honor Dr. Martin Luther King (see wikipedia/reluctance to observe)

Sen. John McCain (Republican of Arizona) voted against the creation of the holiday to honor Dr. King. He also defended AZ Republican Governor Evan Mecham's initiative to cancel a paid holiday in observance of MLK Day by state employees.

Sen Jesse Helms (Republican of North Carolina) led opposition to the bill and questioned King's importance to receive an honor (see social issues). He criticized King's opposition to the Vietnam War and accuse him of espousing "action-oriented Marxism"

In 2007, there has been a dramatic changes in the observance of the MLK holiday in both public and private sectors. Wikipedia identified that 33% of employers gave their employees a day off. While others opted to use this day as a floating holiday.

In the 21st Century, across the United States many observe the Martin Luther King Jr Holiday. Last year, in August 22, 2011, the Memorial of Dr. Martin Luther King Jr. was opened to the public after two decades of planning, fund raising and construction. It is located at the West Potomac Park in Washington, DC.

Source: wikipedia.org
As of today, Dr. Martin Luther King Jr. is still a center of discussions and controversies. Historians, activists, pundits, scholars and among the people argue and discuss about his insights, visions and approaches in changing America's practices toward social issues, specifically on racial discrimination, equality, and profound activism.

Dr. Martin Luther King Jr, said;

"If you want to say that I was a drum major, say that I was a drum major for justice. Say that I was a drum major for peace. I was a drum major for righteousness. And all of the other shallow things will not matter."

The following video link is worth remembering the ideals and legacies that he left us and still be our guiding principles in the future ... (source: AARP.org)

President Obama, the First Lady Michelle Obama and Malia honor Martin Luther King Jr.

We like to hear about your insights. You can email your comments to:info@jntconsulting.com or send through the provided message field at the end of this article.

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Thursday, January 12, 2012

Misclassifying Worker as Independent Contractor - New California Law Plus Implications where Business Operates

In October 9, 2011, Governor Jerry Brown signed into law the Senate Bill 459 (Ellen Corbett) which prohibits willful misclassification of a worker as an independent contractor.  

As of January 1, 2012, this new California Law took effect with Section 226.8 has been added to the Labor Code.

The following are its provisions; 
1. Willful misclassification of an individual as an independent contractor.
2.  Charge an individual who has been willfully misclassified as an independent contractor a fee, or making any deductions from compensation, for any purpose, including for goods, materials, space rental, services, government licenses, repairs, equipment maintenance, or fines arising from the individual’s employment would have violated the law if the individual had not been misclassified.

When a violation has been determined, a person or the employer would be;
1. Subject to a civil penalty of not less than five thousand dollars ($5,000)
2. And not more than fifteen thousand dollars ($15,000) for each violation, in addition to any other penalties or fines permitted by law

When a violation has been determined that an employer or a person has engaged in any of the enumerated violations of subdivision; (a) and the person or employer has engaged in or is engaging in a pattern or practice of these violations,
1. Subject to a civil penalty of not less than ten thousand dollars ($10,000)
2. and not more than twenty-five thousand dollars ($25,000) for each violation, in addition to any other penalties or fines permitted by law.

When it is determined that the person or an employer is a licensed contractor company pursuant to the Contractors’ State License Law and has violated subdivision (a), State Agency shall transmit a certified copy of the order to the Contractors’ State License Board for disciplinary action.

An employer who is determined as a violator of the law, it will be required to do the following;
1. Must post a notice on its website that; (a) it has committed a serious violation of the law by engaging the willful misclassification of employees, (b) it has changed the business practices to comply with the law, (c) it provides any employee who believes that he or she is being misclassified as an independent contractor may contact the Labor and Workforce Development Agency. The notice shall include the mailing address, e-mail address, and telephone number of the agency. (d) the notice is being posted in pursuant to a State order.

In addition the employer also shall satisfy the following requirements in preparing the notice:
(1) An officer shall sign the notice.
(2) It shall post the notice for one year commencing with the date of the final decision and order.

An inspection to the compliance of the law may take place at any time. Violators of non-compliance to issued order will be given a citation in addition to the penalties or damages that are otherwise available at law.

When an employer does not have a website, such notice must be posted prominently in areas that are accessible to employees and the public.

1. Any person or employer who will hire an independent contractor must understand the full responsibility of the function and not the same or similar to someone who is employed in the organization.
2. The Rule of Thumb, check the IRS IC Test to determine whether the position is classified correctly as an independent contractor versus a supervised or managed employee.
3. It will be worthy to understand the example provided by the IRS regarding their description of a Common Law (Employee)

Common Law Rules (source: IRS.gov)
Facts that provide evidence of the degree of control and independence fall into three categories:
a. Behavioral - does the company control or have the right to control what the worker does and how the worker does his / her job?
b. Financial - are the business aspects of the worker's job controlled by the payer? (these include things like how worker is being paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
c. Type of relationship - are the written contracts or employee type benefits (1.e. pension plan, insurance, vacation pay, etc.) identifiied? Will the relationship continue and is the work performed a key aspect of the business?

4. When in doubt about the responsibilities of the role and cannot determine whether or not it falls in a correct classification, sought the guidance of an experienced human capital consultant or employment attorney

Many argue that this law is a "job creation killer". For any follower of laws, a correct classification of every worker will take place upon hire. For any non-follower of laws, an employee who may not qualify to perform the role of an independent contractor may be classified as one for purposes of convenience and cheap labor.

This law has a backbone to protect hard working individuals and be classified as independent contractor. This new law also allow anyone within the organization to report to the State Agency, that there is someone working within the premises who was misclassified.

The ICs are business people who deliver the quality of work without the help of micro-managers.

Business Operation's Location as a Consequential Evidence of Greater Interest:
When executing an independent contractual agreement, do not ignore to identify the actual location of the job being performed by the Independent Consultant / Contractor, required by the contracting business. It is equally essential to identify the actual location of the hiring party whether within the state or outside the state. The relationship between parties must demonstrate the impact of "materially greater interest" when the job is being performed. Both locations help determine the location of materially greater interest.

The most recent case that illustrated such conflict which emphasized the business operations location and its greater interest was the case of Ruiz v. Affinity Logistics Corporation.

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Discriminatory Hiring and Business Practices

Hiring is a two way street, it involves the interaction between two parties (the candidate for a job and the hiring party). Both parties will have a discussion about expectations, opportunities and limitations relative to the job functions and the candidate's competencies. Regardless of the result of the discussions, one is a winning party if not both.
In the past years, there were evidence of declining good hiring practices as discriminating practices were more evident. The following illustrate examples of practices that were reported and can be found publicly in the internet;

The US Department of Labor pursued cases of discriminatory practices such as;

On Equal Pay:

In prior year, evidence of discrimination exist to individuals whose age ranges above 40's.

“In this day and age, it is shocking that any company would allow race to be a factor in determining who gets hired,” said OFCCP Director Patricia A. Shiu.

The main question is, what triggers employers to discriminate against individuals while there are laws that prohibits such actions.

As long as there are individuals who play the role of a victim, the "exploiter" will take advantage at any rate until such time the actions are caught.

As we have seen in different industries, the so called exploiters like cheap labor and greed. Sometimes the influencer to such discriminatory action is power and familiarity.

Do you think there be a time where 'total equality and respect' will exist in this world? Your guess will be as good as mine ~

We like to hear about your experience. You can email your comments to: info@jntconsulting.com or send through the provided message field at the end of this article.

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