It’s tough being an employer, especially here in Hawaii

If I am a business, or even a nonprofit, in Hawaii and I want to hire paid staff, there are all kinds of things to consider.

Before I hire the worker, I need to comply with laws saying what I can and can’t ask the prospective employee. I might get in trouble if I ask the prospect what he or she was paid at the prospect’s previous job, for example. If I clear that mine field and find a prospect that I want to hire (which is challenging because our unemployment rate is so low) there are laws saying I need to check on things like immigration status and documentation, or whether there is an outstanding child support obligation.

When I pay the worker, I need to comply with wage and hour laws, meaning that I need to pay the worker at least a certain amount per hour, provide breaks at various times, and if I go over a certain number of hours in a week I need to provide for overtime pay. The definition of exempt employee who can be paid on a salaried basis has been shifting, so I need to be sure my understanding of that is current as well.

Then, I need to set up withholding for federal and state income tax, unemployment tax, and Social Security.

I need to have some required insurance in place, like temporary disability insurance, workers’ compensation, and Obamacare-compliant prepaid health care insurance. Each of the insurers then has the right to audit my operations, to make sure I am in the proper risk category. So, I can look forward to a bit of extra work whenever one of these audits takes place.

At the place of employment, I need to make sure that I have a number of signs and placards that are required by federal, state and local employment laws. There are different agencies that specify the content of these placards, and from time to time the required language changes. So, I need to have a current set of these signs and placards.

Besides having all of these required items, and I probably missed some, then there are items that I as an employer need to provide just to be competitive. For the overall work schedule, I provide for paid holidays, sick leave, family leave, vacation. Providing a simple “here’s x days of paid time off,” although previously legal, now might lead to problems.

Some workers want to see that employers have a retirement plan (that the employer pays into). Having one of these is not a piece of cake. When I had one, IRS requirements shifted every year, so I would have to have a law firm review the plan every two or three years, and of course the firm charged a princely sum for their services. When a financial advisor I knew found out how many employees I had that were covered by the plan (I could count them on one finger), he burst out laughing. I got rid of the plan at the end of that year.

Man, it’s not easy being an employer.

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Tom Yamachika is president of the Tax Foundation of Hawaii.

4 Comments
  1. harry oyama July 1, 2018 1:47 am Reply

    Try and fire a bad attitude employee with “cause”, good luck on that! Hawaii is not a business friendly State because of its union influence encouraging slackers so long as they pay dues. Most employees these days are lazy and unproductive, always wanting more than what they’re really worth.

    Those who smoke often waste at least one or more hours puffing away at their poison while non-smokers usually have to carry their load while being away at their desk, yet during the end of the day, they get the same pay for working less. These smokers should be made to make up for the lost time and and not get OT, besides smoking will cause additional health problems that cause the employer to paid more for medical coverage.


  2. numilalocal July 1, 2018 11:29 am Reply

    When I owned a business, payroll burden – taxes, withholding, insurance – was about 40% of total payroll. Money that the business does not get back. 40 cents of every dollar paid to someone went to government-mandated costs. Remember that when complaining about prices and the cost of doing business.


  3. harry oyama July 3, 2018 9:52 am Reply

    Another big rip off is the State’s mandatory yearly vehicle safety check inspection that requires auto shop owners to not just document a list of safety checks, but electronically input digital pictures of each vehicle they inspect, then download that information into the State’s database.

    One the average it takes roughly between 20-40 minutes of his time that is not compensated if you average 1 hour per vehicle and often each shop gets a least a dozen cars per day. So 12 hours is lost considering a shop charges about $50 an hour, all lost time he has to absorb.

    Besides, now cops and law enforcement now has a detailed data base to access at no cost to them, since the auto shop owners created it, then they should be the rightful owners of such data base and charge cops a fee each time they access it to cover all the lost time it took creating it.


  4. Oingo boingo July 3, 2018 1:24 pm Reply

    All this whining about the cost of doing business here……What about the cost of living…..Rent,food,etc…


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