The election of Joe Biden and Kamala Harris on November 3 promises to bring sweeping changes to federal laws and policies concerning wage and hour, taxes, and much more. These changes will have a significant impact on the payroll profession. Here are some highlights of what may come, according to the Biden-Harris campaign's website.
Taxation Issues
The Biden campaign has promised to raise taxes on wealthy Americans. The campaign's webpage on tax policy includes tax priorities such as:
- Raising federal income taxes on anyone earning $400,000 or more
- Increasing the top individual federal income tax rate to 39.6% (currently 37%)
- Requiring those earning more than $1 million to pay a tax rate on investments equal to the rate of tax on their wages
- Adjusting the income tax benefits of participating in plans such as 401(k) plans "across the income scale, so working families also receive substantial tax benefits when they put money away for retirement"
- Offering tax credits for child care, home purchases, and health care
Wage and Hour Issues
The incoming administration has a number of priorities that affect the wage and hour issues payroll is concerned with, including:
- Raising the federal minimum wage to $15 an hour (currently $7.25 an hour)
- Increasing the enforcement of minimum wage and overtime laws to recover wages owed to hourly employees
- Enacting legislation protecting workers' rights to unionize
- Reforming and enforcing the classification of workers as independent contractors, including those working in the gig economy
- Reforming labor provisions relating to joint employer status
A number of the new administration's priorities on immigration policy also promise to impact payroll:
- Ensuring employers have the right tools to certify their workers’ employment status
- Eliminating workplace raids so threats based on worker status do not interfere with their ability to organize and improve wages and working conditions
- Expanding protection for undocumented immigrants reporting labor violations
- Reforming the visa program for temporary workers in selected industries
- Expanding the number of high-skilled visas and eliminating the limits on employment-based visas by country
To learn more about federal and state laws, regulations, and information to keep your company's payroll operations in compliance, check out Payroll Source Plus!
Edward Kowalski, Esq., is Managing Editor of Payroll Information Resources for the APA.
