News in 2020

 Business Mileage, Medical, and Moving Rates Decrease

On Dec. 31. 2019, the Internal Revenue Service (IRS) issued the 2020 optional standard mileage rates, which are used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

Beginning on January 1, 2020, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 57.5 cents per mile driven for business use (down from 58 cents in 2019);
• 17 cents per mile driven for medical or moving purposes (down from 20 cents in 2019); and
• 14 cents per mile driven in service of charitable organizations (unchanged).

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Health Care Expenditure Rates

Under the Health Care Security Ordinance, employers must spend a minimum amount on health care for their San Francisco employees. As of January 1, 2020, the rates are as follows:

• $3.08 per hour for employers with 100 or more workers worldwide
• $2.05 per hour for employers with 20-99 workers worldwide

New San Francisco Labor Law Posters

OLSE has released two updated posters that must be placed at each job site or workplace location where employees can read them easily.

• 2020 Health Care Security Ordinance Poster
• New Fair Chance Ordinance Poster

The HCSO poster must be posted as of January 1, 2020. The Health Care Security Ordinance poster should be printed on 8.5" x 14" paper. The Fair Chance Ordinance poster may be printed on 8.5" x 11" paper. You may also receive copies of these posters in the mail.

On Dec. 11, 2019, Washington amended its wage and hour laws to increase the salary threshold white-collar employees must satisfy to qualify for the state’s overtime exemption. The amendments also update some white-collar duties tests to conform with the federal duties test under the Fair Labor Standards Act.

The updated salary levels will depend on employer size and will be based on the applicable state minimum wage rate. As a result, the threshold for the white-collar exemptions in Washington will rise as the minimum wage rate increases. 

The new threshold and duties tests become effective on July 1, 2020. 

Employers should review these amendments and update their payroll practices accordingly. Preparing to comply with this threshold increase may require reviewing employee salaries and responsibilities to ensure they are classified appropriately.

In the twilight amidst another government shutdown, Congress has signed and passed the budget for 2020. Amongst some of the provisions are an extension of the Work Opportunity Tax Credit (WOTC) program through December 31, 2020.

With the WOTC program renewed December 31, 2020, employers will be able to administer the program and earn up to $9,600 per qualified candidate. In addition, amongst some of the other provisions noted in the bill is the retroactive extension of the Empowerment Zone tax credit, also to December 31, 2020.

For the past two years that the credit had expired, in addition to the upcoming year, Employers will be able to receive tax credits for individuals that qualified under the Empowerment Zone criteria.

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