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CAN IDA INCENTIVES HELP YOUR COMPANY

August 12, 2014

The purpose of the various Industrial Development Agencies  (IDAs) in the state of New York is to promote economic development within each of their respective counties.  Since 1969 the IDAs have been offering various types of financial incentives for business projects which are focused on the creation and retention of jobs and economic development, such as opening a new business, expanding or renovating your current business, or leasing or purchasing a new facility.  Project sizes range from one hundred thousand dollars to tens of millions of dollars.  In order to qualify for IDA assistance, your company would need to satisfy eligibility requirements and demonstrate a need for assistance.

Below is a list of some of the Financial Incentives the IDAs have to offer which your business may be eligible for.  

1.  Real Estate Tax Abatements

 The IDAs can transfer a portion of the value of its exemption from real property taxes to your company. To do so, the IDA takes temporary ownership interest in the property your company will use for the project, for the period of time during which the incentives are being provided. A “PILOT” (Payment In Lieu of Taxes) program is utilized to make reduced payments instead of real property tax payments. The PILOT program provides your company with valuable certainty as The PILOT payment, unlike actual real estate tax payments, will not rise above a set amount for the term in which the IDAs haslegal ownership of the property.

2.  Sales and Use Tax Exemptions

For projects in which construction or equipment purchases occur, the IDAs may issue a sales tax exemption letter for eligible construction materials, furniture and equipment your company purchases in connection with its project. This provides your company with a savings of at least 8 1/2 percent.

3.  Mortgage Recording Tax Exemptions

Your company may be entitled to a full exemption from mortgage recording tax for any mortgage recorded in connection with a project. The savings realized can be substantial.  For example, for a mortgage with a principal amount of three million dollars, the savings would be $31,500 (1.05% current mortgage tax rate in Nassau and Suffolk Counties x $3,000,000)

4. Tax Exempt Financing

The IDAs are authorized to issue tax-exempt bonds, and can act as a financial conduit by making the bond proceeds available to your company to finance an expansion. If your project meets the requirements for tax-exempt financing, your company may be able to obtain below market interest rates. Certain bonds are exempt from New York State and local income tax, while others are exempt from federal, New York State and local income taxes. An analysis will be undertaken by the IDAs to determine whether your project meets the requirements for tax-exempt financing established under the Internal Revenue Code.

 
The IDAs will undertake a wide variety of projects involving commercial or research facilities, as well as manufacturing, industrial or warehousing facilities, and is open to proposals from all economic sectors. If you are working on or considering a project which you think may be eligible for the financial incentives offered by the IDAs, or are just interested in hearing more about the financial incentives the IDAs have to offer, we will be happy to discuss them with you in further detail and guide you through the application process.
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10 ITEMS TO INCLUDE IN YOUR EMPLOYEE HIRING PACKAGE

June 16, 2014
Whether you are a large or small business, it is important to have a well-organized hiring package for new employees.  A hiring package is essentially a packet of employment-related forms and documents for the new employee, which is provided at the start of employment to help streamline the on-boarding process.  The hiring package provides an introduction about your company culture, while ensuring your company’s compliance with labor and employment laws.  In addition, a well-designed hiring package may help to mitigate against employment-related disputes.
THE FOLLOWING ARE TEN ITEMS TO CONSIDER INCLUDING IN YOUR COMPANY’S HIRING PACKAGE
empoyee benefits
1.  Welcome Letter.  A brief welcome letter from the company is a positive first impression to a new relationship.  The letter introduces your company, its mission statement, and expresses delight in having the new employee join the “team”.
2.  Application Form(s).  A copy of any job application form(s) filled-out and signed by the new employee should be included in the hiring package.  An application should at least include contact information (i.e., address, phone number), date of birth, and an emergency contact person for the new employee.
3.  Tax and Government Forms.  Some forms are required by the Government, including a Form W-4 and Form I-9.  New York State requires that every new employee be given a Notice and Acknowledgment of Wage Rate and Designated Payday, Hourly Rate Plus Overtime, which they are required to sign and return to their employer.
4.  Consent and Disclosure for Background Checks/Drug Testing.  If your company conducts background checks and/or drug testing, prior notice and consent of the employee is required.  Such consent is typically obtained at the interview process but, if not, include proper consents/disclosures in the hiring package.
5.  Employee Handbook.  Becoming familiar and acquainted with company policies and procedures is essential at the start of new employment.  Provide an Acknowledgment of Receipt of the Employee Handbook for the new hire to sign and return.  (If your company does not have an employee handbook, please contact us to discuss the importance of having one.)
6.  Benefits and Insurance.  If the new employee is eligible for health insurance on other benefits, such as a 401(k) plan, you should include a summary plan description in the hiring package.
7.  Payroll Documents.  If your company uses direct deposit, include the enrollment form in the hiring package.
8.  Company Directory.  The hiring package should include a company directory, which includes a list of personnel names, title, email addresses and telephone extensions.
9.  Confidentiality and Non-Compete Agreements.  Depending on the nature of your business, you may want your new employee to sign a confidentiality agreement if he/she will have access to any trade secrets.  If applicable, you may also want the new hire to sign a non-compete agreement.
10.  Resume/Work Schedule/Job Description.  It may be worthwhile to have the new employee initial his/her resume submitted to the company for the job opening, and attach it to a work schedule and job description.  Including such paperwork in the hiring package may prove fruitful in the event of any discrepancy(ies) following the hiring.
This list is not exhaustive, as each company may have additional information and documentation relevant to its particular business that it may include in its hiring package.  We are happy to assist you in developing a new hiring package suitable for your company.

Do You Actually Need a Lawyer?

August 8, 2013

Sometimes it’s easy to know if you need to find an attorney. If you’ve been charged with a crime, been served with a lawsuit, or need a divorce – a lawyer is exactly what you need. Lawyers, however, aren’t just for criminals or those in litigation. Qualified attorneys can also provide advice and knowledge to people who just need to talk to an expert.
A skilled lawyer’s advice can help you understand the complex rules associated with business negotiations and partnerships, estate planning, will and trust drafting, tax strategies and much more.

Lawyers improve their clients’ quality of life by protecting them from situations that might later bring emotional and financial hardship. A good, high-quality lawyer is there to help those in trouble now and those who want to avoid trouble in the future. 

Many people view legal representation as an all-or-nothing proposition: either you cede control of your issue to an experienced professional or take care of it yourself. While both approaches have their strengths and weaknesses, there is a middle ground. Preparing a document by yourself, and then having it reviewed by a lawyer can save you a significant amount of money in addition to having the peace of mind provided by a seasoned lawyer.

In less serious matters, self representation may also be an option. You may be able to resolve a minor legal dispute by writing letters or negotiating informally, or in a “small claims” court if the dispute has a value less than or equal to a certain amount (perhaps $5,000). Be sure to check with your local court for applicable “small claims” limits
 
 When in doubt, it is best to speak with a lawyer.

If you have any legal issues of concern you would like to discuss, please contact our firm.

Now that you survived the fiscal cliff, it’s time to plan for your future.

January 23, 2013

Whether you are a business owner or not, now that the fear of falling over the fiscal cliff has been eliminated, its time to focus on your future.  What are the legal issues that you might want to address in 2013?  Below is a suggestion of five things to consider looking at this year:

1. Review Your Employee Policies.   If you’re an employer, review your employee policies (and Handbook or Manual, if you have one) to make sure that they still reflect the policies being followed and to determine if any changes should be made.  Having a bad employee handbook can be harmful. Your company’s employee handbook shouldn’t describe policies and procedures that you don’t follow. It is not a place to describe your dreams for how your business ought to work. It is a place to describe the reality of how your business actually operates.

This year pull out your handbook or policies, sit down, and read them. Then update, edit, and delete as necessary.  Finally, distribute the revised handbook or policies to your employees and have them sign a form acknowledging receipt. Keep the form in your personnel files.

2.   Review Your Will.  The recently enacted American Taxpayer Relief Act of 2012 changed the Federal estate and gift tax laws.  Most Americans will benefit from theWill Signing.2 fact that the estate and gift tax exclusion was increased to $5,250,000 and that the “portability” election of exemptions between spouses remains in effect for decedents dying after 2012.  (If you don’t know what this is, you should probably be contacting me to find out.)  However, for those with taxable estates, the top tax rate increased in 2013 from 35% to 40%.

The new law provides some degree of certainty as to the Federal Estate Tax and allows for planing to fit the needs of each individual.  If you have a Will which was prepared prior to 2011, it should be reviewed to insure that there are no unintended consequences of any tax related provisions, such as credit shelter trusts.  Since the estate tax exemption for residents of New York State is still $1,000,000, a state estate tax of approximately $421,000 could be incurred upon the death of the first spouse, which tax can be deferred with proper planning.

3.  Update Your Shareholder/Partnership/Operating Agreement.  If you own a business or real estate and have a partner, it is critical to have an agreement in place with your partner or partners.  The type of agreement that is appropriate is dependent upon the type of entity.  If you already have an agreement with your partners, it is important to periodically review it to make sure that it accurately reflects the current business agreement between the owners.  Key issues to be addressed are buy-out rights, valuation issues, restrictive covenants, and obligations of indemnity between the partners for company liabilities.  If you don’t already have an agreement in place, make 2013 the year to do so.

4.  Consider Filing for a Tax Grievance.  With declining property values throughout New York, now is the time to make sure that your home or commercial property is not over assessed for real estate tax purposes.  The requirements to file vary depending upon the location of the property, as do the filing deadlinewhite houses.  For example, Nassau County requires that a tax grievance be filed by March 1.  The grievance can be handled by an attorney or non-attorney.  Aside from a small filing fee payable to the county or city, typically the fee charged by attorneys and companies that specialize in providing such services is a contingency fee – meaning that there is only a cost to you if you save money.  In most cases, you have little to lose and a lot to gain by filing for a grievance every year.

5.  Consider Whether You Need any New Agreements for your Business.  Depending on the type of business or industry you may be involved in, various types of written agreements are essential to avoid disputes and minimize liabilities later.  Further, a written agreement may serve to provide protections your business might not otherwise enjoy.  Some types of agreements to consider are as follows:

(a)     Agreements for key employees – Employment Agreements and Restrictive Covenant Agreements can be drafted to primarily protect the employer.

(b)     Confidentiality Agreements – such agreements are essential for employees, independent contractors, outside sales people or vendors who have access to valuable information of your company, including customer lists, product development and proprietary processes.

(c)      Standard Terms & Conditions for sales to customers – whether your business sells tangible products or provides services, among other benefits, Terms & Conditions are an effective way to reduce liability for warranty claims.

(d)     Independent Contractor/Subcontractor Agreements – to the extent your businesses regularly utilizes the services of third parties, a written agreement setting forth the obligations of such third party to you and the customers of your businesses is critical in the event of a dispute.

As the saying goes, “Don’t put off until tomorrow what you can do today.”  If you have any questions relating to the suggestions above, or need assistance in implementing them, please contact our office.

PAYING EMPLOYEES FOR WEATHER RELATED ABSENCES

November 9, 2012

The rules which apply to whether or not you have to pay your employees for whether related absences depends on whether they are considered exempt or non-exempt employees.

Most employees are considered non-exempt under the federal Labor Standards Act (FLSA) and are covered by the FLSA’s minimum wage and overtime pay provisions. Non-exempt employees generally must be paid only for the time they actually work. ImageTherefore, non-exempt employees who choose not to report to work during inclement weather conditions do not have to be paid under the FLSA for the time they do not work. The FLSA also does not require non-exempt employees be paid where the employer closes the organization due to inclement weather. Furthermore, nothing in the FLSA prevents non-exempt employees from choosing to use (or from employers requiring non-exempt employees use) available vacation days or personal days for weather-related absences.

While the FLSA does not require non-exempt employees be compensated for work missed due to inclement weather, employers should be aware that New York has a “reporting time pay” law. The “Reporting time pay” law (also referred to as “show-up pay” or “call-in pay” law) requires under certain circumstances for employees who report for work as scheduled or requested by the employer be paid for at least four (4) hours or the hours in the regularly scheduled shift, whichever is less, at the basic minimum hourly wage. This means that if an employer requests or schedules non-exempt employees to work a full day and then, due to inclement weather, has to close after a short period of time, the employer may still have to pay the employees who reported to work for at least four hours at the basic minimum hourly wage.

Employers who operate outside of New York State should become familiar with the reporting time pay laws (if any) of the states in which they operate.

Exempt employees under the FLSA are generally those who work in bona fide executive, administrative or professional capacities, as well as certain computer employees and outside salesmen.  Most exempt employees are paid on a salary basis, meaning their compensation is regularly set regardless of the quality or quantity of the work performed. The rules for compensating exempt employees for weather-related absences differ depending on whether the absence is initiated by the employer or the employee.

Employer Remains Open and Employee Chooses Not to Report to Work.

Under the FLSA, if an employer remains open during inclement weather and an exempt employee chooses not to report to work, the employer can deduct from that employee’s salary for the full-day absence. Note that deductions can only be made for full-day absences.  If an exempt employee comes in late or leaves early due to inclement weather, the employer must pay the employee his/her full salary for that day. To that end, an employee who misses one and one-half days due to inclement weather can have one day’s salary deducted for the full-day missed, but no time may be deducted for the half-day missed.

Nothing in the FLSA prevents an employer from requiring an exempt employee to use vacation or other accrued paid time off when the employee misses full or partial workdays and the employer remains open for business. However, if the exempt employee does not have any accrued paid time off left and comes in late due to inclement weather, the employer must still pay that employee for the full day’s work.

Employer Closes Operations.

Where an employer chooses to close operations and the closure lasts for less than a full workweek, the employer cannot make deductions from an exempt employee’s salary for any time missed. An employer, however, does not have to pay employees for any full workweeks where the employer’s operations are closed due to inclement weather (although these circumstances are rare).

Even though the employer cannot make salary deductions due to unavailability of work where an exempt employee is “ready, willing and able to work,” the employer can require exempt employees use accrued paid time off when the employer closes work due to inclement weather.  If the employee does not have any accrued paid time off left or has a negative leave balance, the employer must still pay that employee’s salary for the day the employer closes.

Other Considerations

In addition to federal and state laws that govern employee compensation for weather-related absences, employers should consider any promises made in employee handbooks, employment contracts, or collective bargaining agreements. While wage and hour laws provide the minimum requirements for compensating employees for weather-related absences, an agreement between the employer and its employees can certainly provide employees with “more” (in other words, wage and hour laws operate as a floor, not a ceiling, for how an employee gets compensated for weather-related absences).

Lastly, employers that intend to require employees use accrued paid time off during weather-related absences should include a statement to that effect in their employee handbooks.

If you have any questions regarding the information provided above, please contact our firm.

SPECIAL ALERT – BEWARE OF NEW CHECK SCAM

October 1, 2012

I have just become aware of a new scam targeting attorneys, which would also be “effective” against any company issuing checks.  Please read the article below so that you do not become the next victim.

The scam is very simple and involves the use of the technology that allows for the deposit of checks remotely (by using a cell phone or check scanner). I will use a real estate closing as an example, but any situation in which a company or person issues checks for any reason has the potential for this abuse.

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The attorney at a real estate closing writes a check to John Smith for $100,000 as a disbursement of a portion of the sale proceeds. The next day, John comes back to the attorney and explains that he needs to pay a debt but his creditor will not accept a second endorsed check. He hands the attorney the ORIGINAL check and asks for a replacement payable to Mary Jones. The attorney, having the original in hand, writes a new check and gives it to John. When the attorney’s bank account statement comes the next month, it shows that both checks were paid against the account.

How could this happen? The attorney has the original check in his hand. The answer: the original check was electronically presented for payment by the original payee just before he asked that it be replaced. Then the scammer deposited the second check into a different account.

How do you protect yourself? Besides the obvious solution of not issuing replacement checks, unless you are 10,000% certain that the person returning the check is completely and utterly trustworthy and honest, you should put a stop payment order on the original check and then wait at least 5 business days before issuing the replacement. This does not even give you complete protection, but I believe it would be difficult for the first presenter of the check to argue innocence if he or she somehow electronically presents a check five days after giving up physical possession.

There may be circumstances under which the risk of loss can be shifted to the bank; however, this is not a situation in which the same check is presented twice for payment. This is a situation in which the maker of the check is tricked into issuing two checks, hence the risk of exposure is likely to the person writing the checks.

If you have any questions regarding the information provided above, please contact our firm.

SHOULD YOUR COMPANY HAVE AN E-MAIL LIABILITY PREVENTION PLAN?

May 14, 2012

While e-mail has greatly increased the potential for better business communication and information access, it has its downside. Few employers have yet to fully appreciate the extent to which company e-mail increases their potential liability and few have taken steps to reduce the risk.

E-mail’s “oral-like” feel is deceptively dangerous, since employers and employees may be lulled into saying things in e-mail messages which they would never say in writing–not realizing that e-mail leaves a written record, even after it is deleted. In fact, e-mail has far greater potential for distribution and permanency than other forms of written communication, since it gives employees near instantaneous communication with co-workers, competitors and customers who may be local or halfway around the world, and it leaves a permanent record everywhere it is sent. In addition, messages can easily and cheaply be forwarded by one recipient to a much broader audience than the original sender intended.

Some Areas of Potential Liability For The Employer:
    
    * Invasion of Employees’ Workplace Privacy
    * Copyright Infringement
    * Defamation
    * Sexual Harassment, Discrimination and Cyberporn
    * Trademark Infringement
    * Employees Using E-mail for Criminal Activities
    * Trade Secrets Disclosure

What Can The Employer Do To Reduce These Risks?

An effective liability prevention plan will start with a comprehensive company e-mail policy, but also include continuous employee education and implementation of technological security measures.

Creating The E-Mail Policy:

The cornerstone of any effective e-mail liability prevention plan is a written e-mail policy. If it is to be effective, the drafters of the policy will need to consider not just the liabilities but also the corporate culture where it will be implemented. Otherwise even the most comprehensive policy runs the risk of becoming a document everyone ignores.

Ideally an email policy will start out with a general policy statement explaining about the potential dangers from e-mail and why these risks not only impact the employer, but also impact employee job security and the quality of the workplace environment. Then it should clearly inform employees that company e-mail belongs to the company just like the company fax machine, and is to be used only for business purposes (or within acceptable non-business limits). Employees should be informed that they have no reasonable expectation of privacy while using company e-mail, that e-mail may be searched and/or screened, and that e-mail is retained for a designated period of time, even if it appears on an employee’s computer screen that the message has been deleted. Employees should also be informed that every message they send on to the Internet is labeled with the company’s domain name, as if it were sent on company letterhead. The policy should discourage employees from copying and distributing large portions of documents or images to minimize the risk of copyright and/or trademark infringement. In addition, employees should be prohibited from downloading software from the Internet, both to avoid copyright infringement and to avoid infecting the system with viruses or worms. The policy should contain a section covering treating co-workers and customers with dignity and respect when composing e-mail messages and not using profanity, sexual or racial jokes or slurs. Employees should be encouraged to consider e-mail in the same vein as memoranda and letters. This is also important if e-mail is used to communicate with customers who expect good service and polite responses. Employers may also want to create a response time standard for responding to customer e-mail.

Define Your Goals:

Every employer needs to decide what results it wants to achieve from its e-mail policy.  Some goals to consider:

    – Eliminate any reasonable expectation of privacy on the company e-mail system.
    – Eliminate e-mail used for inappropriate communications, such as racist, sexist or        “sexually explicit” comments or “jokes”.
    – Reduce the risks of misuse by limiting which employees have Internet access.
    – Create an e-mail use policy that fits the corporate culture.

Some Issues To Consider:

    – Should the policy prohibit e-mailing some sensitive business messages, such as                promotions and termination?
    – Should the e-mail of some employees, particularly those with access to trade secrets, be     subject to closer scrutiny?
    – How long should e-mail be stored before being destroyed?
    – Before destroying e-mail, should messages be read?
    – How will violations of the e-mail policy be handled?
   
** Put The Policy In Writing!!! **

Employee Education:

Since it is designed to regulate their behavior, the best-drafted policy in the world is of little use unless it is effectively presented to employees. Employees need to be educated about the e-mail policy early and often.

Conclusion:

      Given the pervasive use of e-mail in business and the many faceted risk it creates for employers, no employer can afford to be without an E-mail Liability Prevention Plan.