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Idaho Small Business Solutions - Taxes
Idaho Small Business Solutions - Licenses
Idaho Small Business Solutions - Insurance
Idaho Small Business Solutions - Employer Issues
Idaho Small Business Solutions - Forms
Idaho Small Business Solutions - Agencies

State of Idaho Web Site

 


Employer Issues

Click here for Employee vs. Independent Contractor informationBusinesses with employees must comply with numerous regulatory, tax and insurance issues. Some businesses attempt to avoid these issues by engaging independent contractors rather than hiring employees or by classifying permanent workers as independent contractors, not as employees. Both Federal and state regulations govern worker classification. Make sure you fully understand them. Heavy fines may be imposed if you misclassify people who work in your business and you may have to pay outstanding back employment-related taxes.

For a list of the primary agencies you need to contact when you have employees or independent contractors, do a search using the Business Wizard. In Section 3, choose "Employee, Independent Contractor, or Both."

Following is a list of most of the issues businesses in Idaho may encounter when hiring or working with employees or independent contractors.  For a brief description of an issue and a link to the related website, click on the name of the agency or activity.

Alien Labor Certification
Idaho Department of Labor 
  U.S. Department of Labor
Background Checks - Pre-employment
Performing Background Checks
Child Support Payroll Deductions
Idaho Department of Health & Welfare
  See Child Support Issues below
Criminal Record/Convicted Felon - Hiring
  U.S. Department of Justice - http://www.justice.gov/olp/pdf/employmentstdssumary.pdf
  Privacy Rights.org - https://www.privacyrights.org/fs/fs16b-smallbus.htm#3
Disabled Employees - Hiring or Accommodating
Federal Disability Employment Information
Americans with Disabilities Act
Idaho Council for the Deaf and Hard of Hearing
Idaho Commission for the Blind and Visually Impaired
Employee or Independent Contractor
Idaho Industrial Commission
Idaho Department of Labor 
Internal Revenue Service 
Employee Training
Idaho Department of Commerce
Idaho Department of Labor
U.S. Department of Labor - Opportunity.gov
Employer Identification Number 
Internal Revenue Service 
Employer Tax Incentives/Tax Credits
Idaho Department of Commerce
Idaho Department of Labor 
  Idaho State Tax Commission
Employment Posters
U.S. Department of Labor
Idaho Department of Labor  
Idaho Industrial Commission
E-verify (Alien Verification Initiative)
Social Security Administration
Department of Homeland Security
Family and Medical Leave Act
U.S. Department of Labor
Farm/Agricultural/Migrant Workers/Farm Labor Contractors
U.S. Department of Labor
Idaho Department of Labor 
Firing/Terminating Employees
Terminating Employees
Health Plans and Benefits
U.S. Department of Labor
Idaho Labor Laws 
Idaho Department of Labor 
Insurance - Workers' Compensation
Idaho Industrial Commission
Visit the Insurance section of this website  
Legal Right to Work in the U.S./Employment Eligibility Verification
Bureau of Citizenship and Immigration Services    
Licenses - Professional
Bureau of Occupational Licenses
Visit the Business Wizard
Military Service - Employer Responsibilities
U.S. Department of Labor 
Minimum Wage
U.S. Department of Labor
Idaho Department of Labor 
Misconduct Investigations 
Employee Misconduct
New Hire Reporting
Idaho Department of Labor  
Overtime Payment
U.S. Department of Labor 
Pension/Retirement Plans
Internal Revenue Service
U.S. Department of Labor
Rehabilitation of Injured Workers
Idaho Division of Vocational Rehabilitation
Idaho Industrial Commission 
Idaho Commission for the Blind and Visually Impaired
Social Security/Medicare Withholding
Social Security Administration
Internal Revenue Service
Substance Abuse in the Workplace
See the Hot Topics page on this site
Taxes (withholding & reporting requirements)
Idaho State Tax Commission
Internal Revenue Service 
Visit the Taxes section of this Web site
Teenaged Employees
  U.S. Department of Labor
   OSHA
Unemployment Insurance Tax - Federal and State
   Idaho Department of Labor 
   Internal Revenue Service 
   Visit the Taxes section of this Web site
Veterans - Hiring
   Idaho Department of Labor
    U.S. Department of Labor
Union Members
    Hiring Union Members
Wage and Payment Practices
   U.S. Department of Labor
Wage Garnishment
      U.S. Department of Labor
Working Conditions
   U.S. Department of Labor
   Occupational Safety and Health Administration (OSHA)
    Nondiscrimination Compliance

Bureau of Occupational Licenses 

link to Idaho Bureau of Occupational Licenses
The Bureau of Occupational Licenses examines and licenses employees and business owners who are engaged in 28 professions. If you or your staff members are required to be licensed and are not, you could be held liable for any consequences set forth by your professional licensing board.  

For a list of professions licensed by the BOL, visit their website at http://ibol.idaho.gov/IBOL/Home.aspx. Occupations not managed by the BOL may be licensed by their specific occupational board, such as the Board of Medicine, Idaho Department of Insurance, Idaho Department of Finance, or State Bar. To find a list of these agencies, visit http://www.accessidaho.org/business/licensing.html

Some professionals may be able to renew their licenses on-line at https://secure.ibol.idaho.gov/eIBOLRenewal/login.aspx?ReturnUrl=%2feIBOLRenewal%2fdefault.aspx.


Idaho Department of Health & Welfare     
   
Division of Family and Community Services

Child Support Deductions: The Division of Family and Community Services receives payroll deductions made by employers for payment of their employees' court-ordered child support payments. When you hire new employees, the Idaho Department of Labor submits a copy of your New Hire report to this agency. If an employee is determined to be in arrears on child support payments, Health & Welfare will send the employer an income withholding order. The order indicates when to begin withholding payments, how much to withhold, and where to send the withheld funds. The employer may charge the employee a small fee to cover administrative costs. 

An employer may be required to enroll an employee's dependent children in the company's health insurance plan if the children have no other coverage. For information, see http://healthandwelfare.idaho.gov/Children/ChildSupport/ChildSupportServices/MedicalSupport/tabid/376/Default.aspx.

Health and Welfare has created an Employer Portal where employers can electronically manage child support income withholding payments and medical support notices. The Portal is found at http://healthandwelfare.idaho.gov/Children/ChildSupport/tabid/76/Default.aspx.

If an employee owes child support in another state, the designated agency in that state may contact the employer with an income withholding order. Failure to comply with the order can result in the employer being held in contempt of court and being fined. If an employee holds a professional or occupational license and is in arrears on child support payments, the license can be suspended, as can the employee's driver's license.

For further information on employer responsibilities call the Department of Health and Welfare at (208) 334-5500 or toll-free at 1-800-356-9868. To find your nearest H&W office, visit http://healthandwelfare.idaho.gov/ContactUs/tabid/127/Default.aspx.

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Idaho Department of Labor                                                                             

The Department of Labor provides a wide variety of information and services for employers through its offices located throughout the state. To find your nearest Department of Labor office, click the icon to the right. The department's website is http://labor.idaho.gov. IDOL oversees the following employee issues: link to Job Service local offices

Unemployment Insurance: Information about unemployment insurance (actually a tax, not insurance) can be found in the Taxes section of this website.

Independent Contractors:  If you are considering using independent contractors in your business, click here for a detailed description of the difference between an Employee and an Independent Contractor. You could face serious penalties if you misclassify workers.

Employment and Training: For a description of available programs, see http://labor.idaho.gov/dnn/EducationTraining/tabid/654/Default.aspx.

New Hire Reporting: Employers must report all newly hired employees within 20 days of the date of hire. Employees who are rehired after an absence of 12 months or more must also be reported. For information, visit https://labor.idaho.gov/newhire/default.aspx.

Minimum Wage: For information on Idaho's minimum wage requirements, visit http://labor.idaho.gov/dnn/Default.aspx?tabid=695. Required minimum wage posters can be printed from the Idaho Department of Labor's website at the location listed below.

Employment Posters:To find the 9 labor posters employers must post, as well as optional posters, visit http://labor.idaho.gov/dnn/Businesses/EmploymentServices/FormsPosters/tabid/649/Default.aspx. Posters are available in both English and Spanish.

Farm Labor Contractors: Contractors who represent workers in securing employment in agricultural positions in Idaho must register with the Idaho Department of Labor, obtain a license, and be bonded. For information, visit http://labor.idaho.gov/dnn/JobSeekers/FarmWorkerServices/tabid/660/Default.aspx. Information is available in both English and Spanish. Farm labor contractors must also register with the Federal government. For information, see U.S. Department of Labor below.

Employer Tax Incentive/Tax Credit: Your business may qualify for a Work Opportunity Tax Credit for hiring an ex-felon, a welfare or food stamps recipient, a recipient of Supplemental Security Income benefits (SSI), or another hard-to-place individual. For information, visit http://labor.idaho.gov/publications/WOTC_Info_Brochure.pdf.  

Alien Labor Certification: This program is designed to insure that admission of foreign workers into the U.S. will not adversely affect wages, opportunities and working conditions for U.S. citizens. Employers planning to bring foreign workers into the U.S. on a temporary work visa must apply for certification. For information, visit http://lmi.idaho.gov/Default.aspx?TabID=764&AspxAutoDetectCookieSupport=1.

Hiring Veterans: For information on hiring a veteran, visit http://labor.idaho.gov/dnn/idl/JobSeekers/VeteransServices/tabid/666/Default.aspx.

Idaho Labor Laws: http://labor.idaho.gov/dnn/idl/laborlaws.aspx

Hiring an Employee with a Criminal Record:  For information about hiring someone who has been convicted of a crime (not just accused), visit http://www.eeoc.gov/laws/guidance/arrest_conviction.cfm and http://www.lac.org/toolkits/standards/standards.htm. It is possible to obtain fidelity bonding for high risk employees through a Federal bonding program administered by the U.S. Department of Labor and Idaho Department of Labor. For information, see http://www.bonds4jobs.com/program-background.html

The Fair Credit Reporting Act, administered by the FTC, covers information that can be legally gathered in a pre-employment background check (see Background Checks below). The Act states that records of arrest cannot be included in an employment background check after seven years. However, a criminal conviction can be reported indefinitely. The Fair Credit Reporting Act can be found at http://www.ftc.gov/os/statutes/fcradoc.pdf. Information on the rights of someone with a criminal record can also be found on the website of the Equal Employment Opportunity Commission (EEOC) at www.eeoc.gov.


Idaho Department of Commerce

Tax Incentives: Find tax incentives for hiring new employees in certain rural counties, for creating jobs, and other opportunities at http://commerce.idaho.gov/business/incentives-/.

Workforce Training: Find information on the Workforce Development Training Program at http://commerce.idaho.gov/assets/content/docs/WorkForceTrainingFund_LH_red.pdf.


Idaho Commission for the Blind and Visually Impaired           logo of ID Commission for the Blind and Visually Impaired

This agency provides rehabilitation services for workers who are losing their vision or have lost it due to an injury, illness, or congenital condition. For information, call the Commission at (208) 334-3220 or visit their website at http://www.icbvi.idaho.gov/


Idaho Council for the Deaf and Hard of Hearing

This agency serves the deaf and hard of hearing and their employers. Find interpreters, assistive devices, and information at http://www.cdhh.idaho.gov/resources.htm or call their office at (208) 334-0879 or (800) 433-1323.


Idaho Division of Vocational Rehabilitation                                                                      Idaho Vocational Rehabilitation Logo

The employer of a worker who has suffered an injury or illness resulting in a permanent or long-term disability that interferes with her/his ability to perform their job should contact this agency for information about rehabilitation services. Workers who qualify to receive Social Security Disability Insurance (SSI) payments should also contact this agency to learn about assistance programs. The agency's website is http://www.vr.idaho.gov/index.shtml.


link to Idaho Industrial Commission Idaho Industrial Commission

Business Registration: 
If you have employees or make retail sales, you must register your business by submitting IBR-1, Idaho Business Registration application, which can be completed on-line at https://labor.idaho.gov/applications/ibrs/ibr.aspxBy completing the form, you will register your business with the ID Industrial Commission, ID State Tax Commission and ID Department of Labor in one easy step. (Please note: submitting this form does not register your business name or entity type. You must register those with the Idaho Secretary of State before completing form IBR-1.)

Workers Compensation Insurance: 
Employers having one or more full-time, part-time, seasonal or occasional workers are required to provide workers’ compensation insurance coverage unless specifically exempt under Idaho law. Information is available at http://www.iic.idaho.gov/publications/ec_idaho_workers_compensation.pdf or contact a compliance representative by calling (208) 334-6000 or toll free 1-800-950-2110. If you have employees who are based in Idaho but work across state lines in a near-by state, they may be covered by your Idaho workers compensation insurance. Visit the website listed above for information.

Workers Compensation Exemptions pop-up box

Exempt Employees: Not all employees or professions need to be covered by Workers' Compensation Insurance. For more information on exempt employees or professions, click on the button to the right. Also see Workers' Compensation on the Insurance section of this site.   

Independent Contractors:  If you are considering using independent contractors instead of employees, be certain you can legally do so. For information on the difference between an employee and an independent contractor, visit Employee vs Independent Contractor or http://www.iic.idaho.gov/publications/ec_ic_vs_employee.pdf. If you classify a worker incorrectly, you could be fined for failure to carry worker's comp insurance.

Rehabilitation Assistance:  If an employee is injured on the job or suffers a serious illness as a result of his/her employment, the Industrial Commission provides rehabilitation assistance. For information, visit http://www.iic.idaho.gov/publications/rd_benefits_injured_workers.pdf.

The IIC offers an informative brochure, Facts for Employers, found at http://www.iic.idaho.gov/publications/ec_idaho_workers_compensation.pdf.

Posters: Employers are required to display a poster indicating their business has worker's comp insurance. The poster should be provided by your worker's comp insurance company. For information, visit http://www.iic.idaho.gov/posters/posters.html.link to IIC regional offices listing

To find your nearest Industrial Commission office, click on the box to the right.                                       


Idaho State Tax Commission

Withholding: If you have an employee who physically works in Idaho, or if you withhold Idaho income tax from a paycheck, see http://tax.idaho.gov/i-1026.cfm

Employer Tax Credits: See http://tax.idaho.gov/s-results-form.cfm and look for Forms 83, 83R, 84, 84R, 85, and 85R, Idaho Small Employer Investment Tax Credit, Idaho Small Employer Real Property Improvement Tax Credit and Idaho Small Employer New Jobs Tax Credit.


Internal Revenue Service

The Internal Revenue Service website, http://www.irs.gov, is an easy-to-use resource to help with Federal business and personal tax needs. You will find information on how to obtain tax forms and publications, tax statistics, tax regulations, taxpayer help and education, IRS news, electronic services, how to contact the IRS via phone and the Internet, and more.

Employer Identification Numbers (EIN): The IRS issues Employer Identification Numbers (EIN), also called tax identification numbers or tax ID numbers. For information, see http://www.irs.gov/businesses/small/article/0,,id=98350,00.html

You will need an EIN if you have employees, make retail sales, or do business with corporations and government agencies. Your bank may require an EIN to open a business banking account. If your business offers employee health insurance, your EIN will serve as your National Standard Employer Identification number for electronic claims reporting.

If you change the name of your business or the entity type, you may need to obtain a new EIN. For information, click on the IRS link above. Idaho does not issue a state EIN; your federal number is sufficient for conducting business in Idaho.

Independent Contractors vs Employees: To learn the difference between an employee and an independent contractor and how it affects your tax reporting, see http://www.irs.gov/businesses/small/article/0,,id=99921,00.html.

Federal Unemployment Insurance Tax: See the Taxes section of this website. 

Tax Withholding: See Employer's Tax Guide, http://www.irs.gov/pub/irs-pdf/p15.pdf and Employer's Supplemental Tax Guide http://www.irs.gov/pub/irs-pdf/p15a.pdf

Social Security and Medicare Withholding: Social Security and Medicare payments withheld from employee earnings are paid to the IRS. For information, see http://www.irs.gov/businesses/small/international/article/0,,id=104936,00.html

Pension/Retirement Plan: For information on establishing an employee pension or retirement plan and required tax reporting, visit http://www.irs.gov/Retirement-Plans/Plan-Sponsor/Small-Business-Retirement-Plan-Resources Information on terminating a pension or retirement plan and the required tax reporting is found at http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics---Termination-of-Plan.

Closing a Business or Changing the Legal Structure: If you close your business, see http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Closing-a-BusinessYou may need to file a final tax return and withholding report at the time of closure.

If you change your entity type (legal structure), you will need to file form 8832 found at http://www.irs.gov/pub/irs-pdf/f8832.pdf.


Occupational Safety & Health Administrationlink to OSHA

OSHA is the division of the U.S. Department of Labor that regulates working conditions. They publish the "OSHA Small Business Handbook" found at http://www.osha.gov/Publications/smallbusiness/small-business.pdfFor information about OSHA and the services they provide, visit their website at http://www.osha.gov or their Office of Small Business Assistance at http://www.osha.gov/dcsp/osba/index.html.  

Information about OSHA's various training programs is found at http://www.osha.gov/dte/index.html. Information for Hispanic employers and workers is found at http://www.osha.gov/dcsp/compliance_assistance/index_hispanic.html.

Teen Workers: If you employ teenagers, visit http://www.osha.gov/SLTC/teenworkers/index.html to find teen worker safety and health information in both English and Spanish.

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U.S. Department of Labor

link to U.S. Department of LaborThe U.S. Department of Labor regulates working conditions, wages, and payment practices through their Wage and Hour Division. The Division publishes the "Handy Reference Guide to the Fair Labor Standards Act" found at http://www.dol.gov/whd/regs/compliance/hrg.htm. 

Wage and Payment Practices: DOL guidelines classify all employees as either exempt or nonexempt. Nonexempt employees are entitled to overtime pay if they work more than 40 hours in a continuous 7 day period. Exempt employees are usually managers who spend at least 80% of their time (60% in retail and service businesses) on management duties. They must also supervise at least two employees and have some discretionary authority over accomplishing their jobs. 

Paying an employee a salary rather than an hourly wage does not automatically classify her/him as exempt from receiving overtime pay. Rather, the duties performed determine their status. If you have questions about the classification of your employees, contact the DOL. If you fail to pay overtime to a nonexempt employee, you could be fined. For information, visit http://www.dol.gov/dol/topic/wages/index.htm.

Employment Laws: To learn about Federal labor regulations that may affect your business, visit the Department's e-laws website at http://www.dol.gov/elaws. The "FirstStep Employment Law Advisor" helps employers quickly determine which of the DOL's major employment laws apply to their business. If your business is a government contractor or sub-contractor, visit http://www.dol.gov/elaws/ofccp.htm to be certain your business complies with all necessary Federal employment regulations.

The DOL Compliance Assistance website at http://www.dol.gov/compliance offers information on Federal employment rules and regulations and how to comply with them.

Employment Posters: If you have employees, you must post labor-related posters, including in a home-based business. To find a list of federal poster requirements, visit http://www.dol.gov/elaws/posters.htm. Posters concerning Idaho laws can be found at http://labor.idaho.gov/dnn/Businesses/EmploymentServices/FormsPosters/tabid/649/Default.aspx.

Health Plans and Benefits: If your business offers health insurance, visit http://www.dol.gov/dol/topic/health-plans/index.htm for information on complying with ERISA and COBRA requirements. Information is also available on the Employee Benefits Security Administration's website at http://www.dol.gov/ebsa/.

Employing Teenagers:  If your business employs teenagers, you will find much information at http://www.youthrules.dol.gov. Laws govern the number of hours teens can work, the types of activities they can perform, and the types of equipment they can operate based on their age.

Hiring Veterans: For information about hiring or retaining employees who are veterans, including information on available training grants, visit http://www.dol.gov/vets/

Employing the Homeless: The U.S. DOL offers programs to train and support homeless individuals and agencies working with the homeless to assist with employment. For information,visit http://www.dol.gov/dol/audience/aud-homeless.htm. Information is also available on training grants available to businesses that employ homeless veterans.

Farm Laborers:  The DOL administers the "Migrant and Seasonal Workers Protection Act" found at http://www.dol.gov/whd/mspa/index.htm. The Act requires farm labor contractors to be licensed by the U.S. Department of Labor as well as by the Idaho Department of Labor. Additional registration is required for contractors who provide housing or transport workers.

Alien Labor Certification: The program is designed to insure that admission of foreign workers into the U.S. will not adversely affect wages, opportunities and working conditions for U.S. citizens. Employers planning to bring foreign workers into the U.S. on a temporary work visa must apply for certification. For information, visit http://www.dol.gov/dol/topic/hiring/foreign.htm and http://www.dol.gov/compliance/audience/foreign_workers.htm.

Family and Medical Leave Act: Businesses with 50 or more employees must comply with this act, which allows qualified employees to take up to 12 weeks of unpaid job-protected leave for specified family and medical reasons. For information, visit http://www.dol.gov/whd/fmla/index.htm. The act also provides 26 weeks of leave for caregivers of wounded military personnel.

Military Service: Employees who are members of the National Guard and who are called to active duty are covered by the Uniformed Services Employment and Reemployment Rights Act. The Act requires employers to reinstate returning employees with the status, seniority, and same rate of pay they would have obtained if they had been continuously employed. The law also prevents discrimination in hiring, promoting, or retaining employees who are in the National Guard. For information on the law and how it may affect your business, visit http://www.dol.gov/dol/compliance/comp-userra.htm

Pension Plans: Find information on employee pension and retirement plans and benefits at http://www.dol.gov/dol/topic/retirement/consumerinfpension.htm. Information on the Pension Protection Act of 2006 can be found at http://www.dol.gov/ebsa/pensionreform.html.

Opportunity.gov: Find information about Federal programs to help unemployed workers improve their skills at http://federalstudentaid.ed.gov/opportunity/index.html. Eligible applicants must have been laid off and be receiving unemployment benefits.

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Bureau of Citizenship and Immigration Services  

Federal law requires all parties in a business to have a legal right to work in the United States. To comply with this requirement, a Form I-9, Employment Eligibility Verification, must be completed by all employees and owners of a business. Employees must complete the form during their first day of work. Employers must complete their portion of the form, including recording the documents presented by the employee to verify identity, by the end of the third day of employment. Employers need to keep the completed forms in their personnel records for at least three years after hiring a new employee. If an employee resigns or is terminated in less than three years, the form must be kept on file for one year after employment ends.  

Overtime Pay: The federal FairPay Overtime Initiative, found at http://www.dol.gov/WHD/regs/compliance/fairpay/main.htm, governs overtime payment requirements.

Minimum Wage: Both Federal and state laws cover minimum wage payment practices. For information on the Federal minimum wage law, visit http://www.dol.gov/dol/topic/wages/minimumwage.htm. Idaho's minimum wage is the same as the Federal minimum wage.

Wage Garnishment: Wage garnishment is a legal procedure in which an employer is required by court order to withhold a portion of a worker’s earnings for the payment of a debt, such as child support. A garnishment can be placed against wages, salaries, commissions, bonuses and pension payments. For information, see http://www.dol.gov/dol/topic/wages/garnishments.htm and http://www.dol.gov/compliance/guide/garnish.htm.

If an inspector visits your office and you can't produce the forms, you can be fined for each undocumented employee, including the business owners. For more information or to download Form I-9, visit http://www.uscis.gov/. 

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Social Security Administration

Federal Law requires employers to withhold Social Security and Medicare payments from employee wage and salary payments. For information and forms, visit http://www.ssa.gov/pgm/business.htm. (Business owners who do not receive a paycheck from their business that includes withholdings must pay self-employment tax, which is a form of Social Security, on their earnings. This tax is paid to the Internal Revenue Service when a business owner files his or her personal income taxes. For more information, see the Taxes section of this website.

E-verify (Alien Verification Initiative): This is a voluntary Federal program designed to enable employers to quickly verify eligibility of potential employees to legally work in the U.S. Participation in the program is voluntary and free, but you must sign up to participate. Enrollment information is available at https://e-verify.uscis.gov/enroll/StartPage.aspx?JS=YES. The initiative is jointly sponsored by the Social Security Administration and the Department of Homeland Security.

Social Security Number Verification Service: Register to verify employee Social Security numbers quickly on-line at http://www.ssa.gov/employer/ssnvs_handbk.htm

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Department of Homeland Security

E-verify (Alien Verification Initiative): This is a voluntary Federal program designed to enable employers to quickly verify eligibility of potential employees to legally work in the U.S. Participation in the program is voluntary and free, but you must sign up to participate. Enrollment information is available at https://e-verify.uscis.gov/enroll/StartPage.aspx?JS=YES. The initiative is jointly sponsored by the Social Security Administration and the Department of Homeland Security.

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Nondiscrimination Compliance

Businesses having five or more employees must comply with state and federal laws concerning various types of discrimination, including discrimination based on race, religion, ethnic origin, gender, disability, age, and pregnancy. These laws include the Americans with Disabilities Act and the Federal Fair Employment Practices Act. The Americans with Disabilities Act provides civil rights protection to individuals with disabilities similar to the rights provided to individuals on the basis of race, color, sex, national origin, age, and religion. It guarantees equal opportunity for individuals with disabilities in public accommodations, employment, transportation, State and local government services, and telecommunications. To learn about your responsibilities under the law, visit the ADA website at http://www.ada.gov/.

A guide containing ADA requirements for small businesses, as well as other publications, can be downloaded at http://www.ada.gov/publicat.htmYou may be eligible for a tax credit if you must make structural changes to your building or work area to accommodate a disabled employee's needs. Check with your accountant for details or visit http://www.ada.gov/taxincent.htm.

The Equal Employment Opportunity Commission's (EEOC) website, found at http://www.eeoc.gov/ and http://www.eeoc.gov/facts/qanda.html, provides much information for small businesses, particularly those without an HR department, to assist with compliance issues.  

The Idaho Human Rights Commission enforces both Idaho and Federal human rights laws. For information on laws that may affect your business, visit the Commission's website at http://humanrights.idaho.gov/.

Some Idaho cities have enacted local non-discrimination laws that may be more stringent than state law.  Check with your city clerk's office to learn your city's requirements.

Harassment:  On-the-job harassment is a federal offense. Therefore, every business, even a very small one, should have a written harassment policy that all employees read and sign. See Employee Handbooks in the Links section of this website for information on creating a harassment policy.

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Federal Disability Employment Information

Federal law requires businesses with 15 or more employees to hire and make accommodation for disabled workers or current employees who become disabled during the course of employment. For information about your responsibilities and for assistance in complying with the law, see https://www.disability.gov/employment.

Idaho law requires businesses with five or more employees to comply with anti-discrimination laws. Any government entity regardless of size, a contractor or subcontractor for the state and their agents must also comply. See http://humanrights.idaho.gov/discrimination/disability.html for information. 

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  Hiring Union Members

Idaho is a Right-to-Work state. Therefore, employees cannot be forced to join a union, nor can union or non-union members be discriminated against in hiring, promotion, or termination. If your business hires union members, you may be asked to negotiate a labor contract covering wages, benefits, and working conditions. A union negotiator will represent union members when problems arise concerning conduct, productivity, and other issues. When the labor contract expires, your employees could strike if the demands contained in their new proposed contract are not accepted. If your business hires union members, either as employees or subcontractors, be sure you understand the laws with which you may need to comply.

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Performing Background Checks

Many businesses are required by law to check the backgrounds of potential employees, independent contractors, and volunteers. These include businesses or positions within a business that work with children, the elderly, the physically or mentally disabled, bank employees, alcohol permit holders, truck drivers, and others. Other businesses may want to perform some type of background check to be certain applicants are honest and don't have issues that may negatively affect their ability to perform their work, such as an alcohol or drug problem, particularly if employees use company vehicles or have access to money or sensitive information. You may also want to check the background of a current employee before offering a promotion or a move to a more sensitive position.

At minimum, a pre-employment background check should include verification of references, past employment, and education as reported on a resume or employment application. It may also include fingerprinting, checking the applicant's driving record and/or past alcohol or drug use, verification of Social Security number, and/or past criminal history. If your business works with children or vulnerable adults, you may need to check the state sex offender registry.

Privacy issues - Employers do not have unlimited rights when investigating an employee or potential employee's background and personal life, so be careful. The person has a right to privacy in certain areas. If you plan to perform a background check, you must obtain permission in writing. The request cannot be contained in an employment application or contract. Rather, it must be a separate, clearly stated request containing a statement indicating that information obtained through the background check may influence hiring or promotion decisions.

The federal Fair Credit Reporting Act (FCRA), administered by the FTC (Federal Trade Commission), sets national standards for employers who want to learn more about an applicant or a current employee. The Act covers "consumer reports," and employment background checks are considered a form of consumer report. The Act covers information that can and cannot be collected about a person’s “character, general reputation, personal characteristics, and mode of living.” The Act also limits access to information contained in a background check to certain key individuals within a company. For an employment background check to qualify as a “consumer report” under the FCRA, it must be prepared by an outside agency, not by your business. For more information, visit http://www.privacyrights.org/fs/fs16b-smallbus.htm. The Fair Credit Reporting Act can be found at http://www.ftc.gov/os/statutes/fcradoc.pdf.

Credit checks - Employees and potential employees have privacy rights in credit checks. Congress is considering a ban on credit checks as a condition of employment because of recent high unemployment and mortgage default rates and their impact on credit ratings. Some states already restrict the use of credit reports in hiring and promotion decisions. Currently, you must obtain written consent before checking a potential or current employee's credit report. 

If you choose to perform a credit check, the three major credit reporting agencies (Experian, TransUnion, and Equifax) will provide a modified version of a standard credit report called an "employment report." An employment report includes information about an applicant or employee's credit-payment history and other credit habits from which employers might draw conclusions about the applicant or employee.

When background checks and/or credit reports are used to make employment decisions, including hiring, retention, promotion or reassignment, the employer must comply with the Fair Credit Reporting Act (FCRA). For more information on credit reports, see http://business.ftc.gov/documents/bus08-using-consumer-reports-what-employers-need-know.

Bankruptcies are public record. An employer, however, may not use bankruptcy as a reason to discriminate against someone, either in hiring or promotion.

Medical information - Medical records are private and cannot be requested or checked. According to the Americans with Disabilities Act, employers may inquire only about an applicant's ability to perform specific job duties, either with or without reasonable accommodation.

Military records - Military service records may be released only under limited circumstances, and consent is generally required.

College/high school transcripts - Consent is required to obtain these records. 

Volunteers - If your business, church, school, sports league, or non-profit organization uses volunteers who come in contact with children or vulnerable adults, they may be required to be to fingerprinted and/or undergo a criminal background check. This includes church volunteers, sports coaches, volunteer teachers/aides and more.

Not all businesses have the expertise or the time to perform a thorough background check and may therefore choose to use the services of a company specializing in background investigations. If you want to begin the process yourself, the Idaho State Police website contains helpful information. For information on fingerprinting, visit http://www.isp.idaho.gov/BCI/index.html. ISP can perform a criminal background check in five northwestern states. To make a nationwide check, visit the FBI website at http://www.fbi.gov/hq/cjisd/fprequest.htm. The employee or potential employee, not the employer, must submit the request for an FBI background report.

For more information about performing pre-employment background checks, visit http://www.sba.gov/content/performing-pre-employment-background-checks and http://www.fbi.gov/stats-services/business/business. Also visit the Idaho Human Rights Commission's website at http://humanrights.idaho.gov/discrimination/pre_employment.html.

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Employee Misconduct

Employee misconduct ranges from simple issues such as spending too much time on the phone or Internet to acts of violence. Some situations, such as repeated absences or tardiness, can be handled with a reprimand or warning. More serious offenses may require an investigation to substantiate allegations or suspicions. In rare instances, you may need to report the situation to the police or another outside agency. Situations warranting an investigation may include:

  • Misconduct relating to conditions of employment, including misuse of equipment, computers, and vehicles and/or refusal to comply with job-specific directions or instruction.
  • Violation of federal, state, or local laws or regulations, including laws against harassment.
  • Violation of the business's pre-existing written policies, such as those covered in employee handbooks.
  • Noncompliance with the rules of a self-regulatory organization that oversees your industry, such as an occupational licensing board, Department of Insurance, State Bar Association, or Board of Medicine.
  • Use of alcohol or drugs on the job or any situation that impairs the employee's ability to safely perform his/her work or that affects the safety of other employees, customers, or the public.
  • Aggressive or belligerent behavior toward the employer, other employees, customers, or the public
  • Dishonesty, including lying, to the employer, other employees, customers, suppliers or the general public
  • Theft
  • Conduct that creates a hostile work environment, including overt discrimination based on race, religion, age, or another protected factor

Depending on the nature of the offense, you may want to hire an outside investigator to assure that you and your business have some legal protection from a potential lawsuit. You may also want to notify your attorney before beginning the investigation. According to the Fair Credit Reporting Act, which covers employment and pre-employment investigations, you do not need to notify an employee or obtain permission to perform an investigation. 

If you decide to take action against the employee after an investigation is completed, you must give the employee an “adverse action” notice, but only after the action (such as a suspension or termination) has occurred. An employee who is the subject of a misconduct investigation is legally entitled to receive only a summary of the investigation report, but not the full report, which may include confidential information, including the names of people interviewed during the investigation.

Depending on the situation, the completed investigation report may need to be shared with:

  • Your attorney
  • Your company board of directors
  • The police 
  • Representatives of any federal, state, or local agency charged with oversight of the business activity in question, such as the Department of Finance or Department of Insurance.
  • Any self-regulatory organization with regulatory authority over the activities of the employer or employee, such as an occupational licensing board, State Bar, or State Board of Medicine.
  • Any other organization as required by federal, state, or local law.

The report should not be shared with other employees or with anyone who does not have a legal need to know. It is important to protect the privacy of the employee under investigation.

According to recent amendments to the Fair Credit Reporting Act, an employee cannot dispute the findings of an investigative report with the employer, but he/she may be able to file a law suit if wrongful termination can be proved. The Fair Credit Reporting Act, which is administered by the Federal Trade Commission, can be found at http://www.ftc.gov/os/statutes/fcradoc.pdf

For more information on this topic, visit http://www.employeemisconduct.com/ and http://www.privacyrights.org/fs/fs16b-smallbus.htm#9.

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Firing/Terminating Employees

According to the Idaho Department of Labor, 

"Idaho is a "work at will" state. This means there is no set length for an employment relationship and either the employer or the employee may end it at any time, with or without notice; with or without cause. If there is an employer policy, employment contract, or union agreement, the employment relationship may be subject to the terms and conditions of that agreement. There are some exceptions to an employer's right to terminate an employee. For example, employees should never be terminated for a discriminatory or retaliatory reason, or a violation of public policy."

Keeping an employee on the payroll when misconduct is occurring affects employee morale and may affect your bottom line. Terminating employment, however, should be handled carefully with respect for the person being terminated. Depending on the circumstances, an employee might sue the business for wrongful termination, harassment, or discrimination, so be careful. If you have a problem with an employee, before terminating him/her, be sure you have kept detailed written records of both offenses and warnings or reprimands, including dates and times.

The following website provides information about your legal responsibilities and your employee's rights:
Idaho Employee Rights -
http://www.accessidaho.org/job_labor/employee_rights.html
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Child Support Issues

If one or more of your employees is behind on child support payments, your business could be negatively impacted. If the employee is required to make child support payments through Health and Welfare in Idaho or another state, you may be required to withhold payments from the employee's income. See Child Support Deductions above. An employee's wages may also be garnished by court order to collect back support.

Your employee may have a professional or occupational license and/or her/his driver's license revoked or suspended. The state may file a contempt of court action, which could result in a jail sentence. For more information, see Idaho Child Support Enforcement Resource Center, http://www.supportcollectors.com/resources_idaho.php.

If an employee owes $2,500 or more in back child support, he/she may be unable to obtain a passport, or may have an existing passport revoked, which could create problems if your business activities require international travel. See http://travel.state.gov/passport/ppi/family/family_863.html.


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