Agency Heads Highlight Valuable Payroll Relationships
APA’s 36th Annual Congress featured three agency keynote speakers during its Federal Government Executive General Session on May 18: Scott Lekan, Commissioner of the Office of Child Support Enforcement (OCSE); David Kautter, Esq., Acting IRS Commissioner and Assistant Secretary for Tax Policy at the U.S. Department of the Treasury; and Bryan Jarrett, Esq., Acting Administrator of the U.S. Department of Labor’s Wage and Hour Division (WHD). All three speakers emphasized the importance of payroll management and partnerships with APA in the success of their agencies.
OCSE Commissioner Lekan
Lekan said that 75% of child support is collected through employee wage withholding, which is why OCSE’s employer services group works so closely with APA to improve collection processes and procedures. In addition, he said that more than $32 billion is collected each year by state and tribal child support agencies with families receiving 95% of the money. The remaining 5% is for reimbursement of public assistance dollars. With $5.33 collected for the child support program for every $1 spent, Lekan said that his agency is one of the most cost-effective government programs.
In addition, Lekan spoke about OCSE’s Child Support Portal as a critical tool to help employers meet their compliance responsibilities under the child support program. Employers with employees in multiple states can report new hires to one state as long as they notify the Department of Health and Human Services, OCSE’s parent agency, through the Multistate Employer Registry located on the portal. Employers also can use the portal to report employee terminations and upcoming lump-sum payments.
IRS Acting Commissioner Kautter
Kautter thanked APA for assisting the IRS with its outreach campaign, “Paycheck Checkup,” which encourages taxpayers to use the agency’s income withholding calculator to check their withholding. He said that the IRS is well aware that many employees have not completed a Form W-4 in decades. However, Public Law 115-97, known as the Tax Cuts and Jobs Act (TCJA), created sweeping changes not seen in 30 years, so now is the time for employees to review their tax withholdings.
In addition, Kautter said the IRS has 140 integrated software systems that must be updated because of the TCJA. He said that while the IRS upgraded its hardware systems, taxpayer data and management programs are still operating on “assembly language code” that is now nearly 60 years old. Assembly language is programming information that is designed to work with a specific computer architecture, as opposed to programming that is portable across multiple systems. This means the IRS must change each of its systems separately and then test and retest each one for its impacts on all others.
WHD Acting Administrator Bryan Jarrett
Jarrett described a new pilot program the WHD launched in April called the Payroll Audit Independent Determination (PAID) program for employers covered by the Fair Labor Standards Act (see PAYROLL CURRENTLY, Issue 4, Vol. 26). In PAID, employers that decide to participate must first review compliance assistance materials provided by the WHD. Then, employers must perform an audit of their compensation practices and notify the WHD of the findings, including documentation, such as the calculation methods used. The WHD will then provide a summary of unpaid wages that, if undisputed by the employer and employees, settles the labor violations. PAID is limited in that situations already under investigation are not part of the program.
Jarrett said the WHD believes PAID will be a win-win for employers and employees. Cases could be settled quickly without litigation and added liquidated damages or civil monetary penalties against employers. Employees will receive wages owed faster. In addition, the process should prevent employers from further violations because they will gain a clearer understanding of the regulations.
The Federal Government Executive Session also is a forum to thank federal government agency employees for their commitment to APA’s Government Relations Task Force and is where the APA’s Government Partner Award is presented. The 2018 recipient was Charles Brady, Jr., Chief of the Customer Respondent Outreach Branch in the Planning and Coordination Division of the U.S. Census Bureau. Brady was recognized for his efforts to connect with payroll professionals before the 2017 Economic Census.