Category Archives: SBAC News

Myths & Facts about 401(k) Plans for Small Business


 

401(k) For Small Businesses
Contributed By: The Tandem Family of Companies

Business owners recognize the importance of offering a 401(k) plan to attract and retain good employees. In a national survey conducted by Spark 401k, 94% of small business owners agreed that offering a 401(k) plan drove recruitment and retention. However, the U.S. Government Accountability Office reports only 10% of businesses with 10-100 employees offer them.

Plus, 47% of small business owners are saving less than 10% of their income for retirement — 25% of those are saving nothing at all! In addition to attracting and retaining quality employees and taking advantage of the tax benefits, you can reap the benefits in your personal retirement planning.

Let’s dispel some of the common myths that may have you reconsidering this game-changing benefit.

Myth #1: I do not have enough employees to host a 401(k) plan.

Spark 401k’s study also revealed that 59% of small business owners that do not currently provide a 401(k) plan believe they are too small to do so. This is false! Thanks to the Economic Growth and Tax Relief Reconciliation Act of 2001, businesses of any size have options. Self-employed entrepreneurs even have solo plans available to them.

Myth #2: I cannot afford to match my employees’ contributions so I should not host a plan.

Just because you offer a retirement savings plan does not mean that you have to provide a match. According to the Society for Human Resource Management, approximately 42% of companies do match, and the most common match today is anywhere from 50-100% on the first 6% of employee deferrals. Regardless of the current trends, you are entitled to match based on your company’s budget. This includes opting not to match at all.

Before striking the notion of matching at all, you should educate yourself on the financial benefits. There are tax deduction benefits that should be discussed with your 401(k) administrator or your accountant.

Myth #3: Administration costs are too high.

It is true that 401(k) plans have fees associated with administering them. However, there are several ways these charges can be absorbed. Some employers opt to pay for all of the costs. Others chose to disburse them out of the plan assets (essentially divvying up the charge to participating employees). There is also an option to share these costs between employer and participating employees.

Danielle Ozer (dozer@BSGInfo.com) is the Executive Vice President of Brokerage Services at the Tandem Family of Companies. The Tandem Family of Companies consists of Tandem HR (HR outsourcing solutions), Benefits Solutions Group (benefits brokerage), Workplace Solutions (Employee Assistance Program) and Alliance Workplace Solutions (voluntary benefits). TFC has been providing custom HR solutions to businesses of all sizes since 1998.

Small Business Backed Ordinance Introduced to Simplify Chicago Sign Code


Today, Alderman Joe Moreno introduced an ordinance that would allow business owners to place non-structural signs and certain stickers on their windows for more than sixty-days without paying for a permit.  It would clarify current sign permit requirements and provide the opportunity for small businesses to address violations prior to being fined.

This marked a great step forward in the SBAC-lead advocacy effort to simplifying the sign code in Chicago and bring much-needed relief to entrepreneurs. Small business owners in Chicago want to comply with the law, but navigating the rules requires valuable time and resources that should be spent on serving customers and growing their businesses.

2017_Dec_MorenoSignCodePressRelease

Federal Tax Reform Legislation Passes Senate – What’s Next?


The Senate passed their version of tax reform, paving the way for a conference committee to iron out the differences between it and the House package passed last month. Republican leadership remains fixed on the goal of sending a final package to the President’s desk for signature by Christmas.

For more information about the two versions of tax reform and their differences, check out this article prepared by the Tax Foundation.

Are You Ready for Health Insurance Open Season?


ARE YOU READY FOR HEALTH INSURANCE OPEN SEASON?

By: John Gotschall

Thanksgiving, Black Friday, Cyber Monday and….Health Insurance Open Season? Indeed, tis the season to determine the best health plan option for your small business. The choices are not pretty, and not always easy to navigate.

When selecting which plan option is a best fit for your business, consider the following points:

1) Based on income and corresponding potential government subsidies, calculate if you and your employees would be better off either buying individual plans on Affordable Care Act Marketplace or selecting a group plan. Group coverage, which require at least two employees, typically offer lower rates, more plan options, larger networks and potential tax benefits. Open enrollment for individuals ends December 15.

2) Determine what your annual claims or medical expenses have been over the past year. Will your claims be about the same next year or are you expecting a large claim? This will help dictate how expansive the coverage you need, and in turn, the price of your premiums

3) What hospital(s)/doctors would you want to go to if you needed care? What networks do they accept?

4) Review quotes from several companies. The essential health benefits and maximum out-of-pocket costs are all basically the same between companies. The difference will be in the PPO or HMO networks offered and price. To determine the lowest cost option if the worst case happened, multiply your premiums by 12 and add your out-of-pocket maximums. Compare the maximum totals of different plan options and the lowest cost wins!

5) Find an experienced insurance agent, who you trust, to help you. An experienced agent will have worked with all of the available health insurance companies that market plans in your area.

John Gotschall is the founder of Coaching Financial Concepts, which provides individual and business guidance on financial planning, business insurance and benefits implementation. johng@coachfinancial.com

#GivingTuesday for SBAC Empower


SBAC Empower is the sister organization of the SBAC. The mission of Empower is to provide tools to would-be entrepreneurs, from the basics on up, in order to navigate the obstacles facing small business owners in Illinois. Empower is participating in a #GivingTuesday campaign to raise funds to support those just joining the small business owner family.

Learn more by visiting: https://sbacempower.org/sponsorship/

SBAC & Net Neutrality Coalition Respond on Cyber Monday


In response to the intention of Federal Communications Commission’s intention to hold a vote repealing current net neutrality rules in December, the SBAC joined with coalition partners around the country in signing the letter below to FCC Chairman, Ajit Pai.

The SBAC is committed to preserving equal access to the internet for both consumers and small businesses. The internet is a vital tool for businesses to reach customers, and without the current net neutrality rules in place, ISP’s could have the autonomy to choose which websites and companies have access to adequate internet speeds and search result placement.

For additional resources on this topic, see this story in the New York Times & the Washington Examiner.

Cyber Monday Net Neutrality Letter

Illinois Senate’s Surprising Failure to Override Governor’s Veto of Equal Pay Bill


ILLINOIS SENATE’S SURPRISING FAILURE TO OVERRIDE GOVERNOR’S VETO OF EQUAL PAY BILL
By: Jason Tremblay

As a follow up to a previous post, Illinois Equal Pay Act Likely to be Amended to Prohibit Salary History Inquiries, and in a surprising turn of events, the Illinois Senate did not overturn Governor Bruce Rauner’s veto relating to an amendment updating the Equal Pay Act of 2003 that would, among other things, prohibit employers from inquiring about the salary history of applicants. This amendment was aimed to mitigate the gender wage gap by eliminating the practice of “low balling” compensation for female applicants.

The Senate voted 29-17, which was far less than when the measure was first called in May. The measure had originally received 35 votes. In comparison, the House overrode the Governor’s veto by a much larger margin.

As such and at least for now, this law is not going to take effect. However, similar laws have been passed in other jurisdictions and there is an increasing trend to amend or enact laws to restrict the ability of employers to inquire about an applicant’s wage history.

Jason Tremblay is a partner at Saul Ewing Arnstein & Lehr LLP. Jason.Tremblay@saul.com

Protect Your Business & Employees from Sexual Harassment


PREVENTING SEXUAL HARASSMENT AT YOUR BUSINESS
By: Arthur  Ehrlich

As allegations of sexual harassment dominate headlines from Hollywood to the State Capitol, it is important to understand what actually constitutes sexual harassment and how to protect your business and employees.

Sexual harassment generally falls into two categories: quid pro quo sexual harassment, when a supervisor suggests that the employee may receive a benefit or favorable treatment in exchange for a date or sex, or harassment in a hostile environment, when there are repeated comments of a sexual nature or uninvited touching, which are deemed offensive to the employee.

Keeping this definition in mind, in addition seeking an experienced legal professional at the first hint of any potential issue, here are five tips to protect your business and employees from sexual harassment:

  1. Enforce a ZERO Tolerance Policy.  A single joke may seem innocent and the employee not appear to be offended, but tolerating a single incident encourages others to make similar comments, which ultimately creates a hostile environment.
  2. Provide Training to All Staff. Regularly educate your staff on what actions and statements might be construed as harassment and about other types of illegal discrimination. Provide a clearly written anti-harassment policy so employees understand what behaviors are prohibited.
  3. Set an Open Door Reporting Policy. Create an open reporting system that allows for employees to make any complaints of harassment. Designate who complaints can be made to and set up an anonymous hotline if possible. Employees should also be encouraged to report harassment of another employee.
  4. Establish Effective Internal Investigation Procedures.  It is imperative that a well-trained person investigates the complaint ASAP. The investigator must be fair, impartial and open minded. Failure to perform an effective and prompt investigation will result in a lawsuit. Any inappropriate act should be dealt with through appropriate discipline.  Separate the employee from the alleged harasser but not in a way that might inconvenience the employee.
  5. Take a Firm Stand on Any Hint of Retaliation. Transferring the employee might be seen as retaliatory even if done to separate her from the harasser. Be very careful before disciplining the employee in the future unless it is unequivocally justified.

Arthur Ehrlich is a partner at Goldman & Ehrlich, which primarily practices employment law.
Arthur@GoldmanEhrlich.com

LLC Fee Reform Legislation Passes Senate 55-0


SB 867, legislation spearheaded by the SBAC to lower LLC fees, passed the Illinois Senate last night with unanimous support by a vote of 55-0! The bill is now headed to the desk of Governor Bruce Rauner for his signature. The Governor previously indicated his support for the measure and we are working directly with his staff to get this bill signed into law in the coming weeks.

SB 867 would adjust LLC fees across the board to bring them in line with what corporations currently pay. For example, the current filing fee to create a new LLC in Illinois is $500. SB 867 would set it to $150. The current annual filing fee for LLC’s is $250, and SB 867 would lower it to $75. To review the legislation in full and see the adjusted fee rates, click here. Please note that these lower fee rates will take effect upon this bill being signed into law.

This initiative is about much more than reducing some of the highest LLC fees in the nation – it is about leveling the playing field for small businesses and ensuring the voice of small business is heard and acted upon in Springfield!