Compensation, Payroll and Deductions

It costs money to hire and pay your employees.

• Recruitment costs
• Workers Comp
• Pay and Bonuses
• benefits
• AND matching deductions

Additionally, you have issues around employees involving

• Federal minimum wage http://www.dol.gov/elaws/faq/esa/flsa/001.htm
• Federal minimum wage http://www.laborlawcenter.com/t-federal-minimum-wage.aspx
• California Wages and Pay FAQs http://www.dir.ca.gov/dlse/DLSE-FAQs.htm
• breaks http://www.dir.ca.gov/dlse/FAQ_RestPeriods.htm
• lunch http://www.dir.ca.gov/dlse/FAQ_mealperiods.htm
• vacations http://www.dir.ca.gov/dlse/FAQ_vacation.htm
• overtime
• postings of rights and responsibilities
• SB 198 Safety Training
• Research the California Labor Code California labor law

Employees earn money as Salaries, Hourly Wages, Bonuses and Commissions Earned. An employer must withhold and pay money for the employee to various government agencies to which the employee owes money. This is basically a service to the employee.

Self employed individuals and independent contractors must keep track and make the same payments to these government agencies. Additionally, the employer must match some of these payments. The bottom line is that your payroll costs will be approximately 15% above the salaries, hourly wages, bonuses and commissions earned.

Formulas:

Total Income - exclusions = Gross Earnings

Gross Earnings - deductions = Net Taxable Earnings

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