Will Indiana Adopt a New Payroll Tax?

Have you experienced a confidential moment with an employee as he tearfully shares that his wife was recently diagnosed with cancer? And that he absolutely must take time off work to drive his wife to doctor appointments and chemotherapy treatments? That moment is terrible, isn’t it?

But then it only gets worse when you, the trusted employer, must look the guy in the eye and explain that any time off from his job will be unpaid as soon as he uses his vacation days. Employers really want to do anything to avoid such a painful moment. The good news is that The Payroll Department can help you help your employees.

According to a recent article printed in the Boston Globe, President Obama highlighted the issue of paid leave during the White House Summit’s discussion about working families. In the United States, only 12% of workers receive paid leave through employment, making America the only developed nation which does not guarantee paid leave for all employees.

Since the 1993 implementation of the Family and Medical Leave Act, job stability has been protected by law when family emergencies require an employee’s long-term absence. However, in the majority of those instances, as previously noted, the leave is unpaid. According to the Department of Labor, in nearly 50% of instances when workers must address home and family issues with reasons ranging from maternity leave to terminal illness of a spouse, employees cannot financially afford to utilize the allotted 12 weeks away from their jobs without pay.

Three states, including California, New Jersey and Rhode Island, found a viable solution to this problem by funding workers’ time off through a small employee payroll tax.

As a small business owner in Indiana who genuinely cares about the welfare of your employees and their families, you might find this option to be exactly what your company can provide. Just as The Payroll Department addresses other bookkeeping issues, such as wage garnishment, tax law changes, FICA and unemployment tax information, we are more than ready to provide payroll services that would handle all employee payroll taxes for you.

-Sherri of The Payroll Department Blog Team