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By now, you’ve probably heard about the landmark United States Supreme Court decision in the matter of Burwell v. Hobby Lobby (Most people just call it Hobby Lobby). The decision allows “closely held,” for-profit corporations to be exempt from federal laws if the owners object because of religious beliefs and if a less restrictive means of furthering the government’s interest exists.

Exemptions for Small Businesses with Less than 50 Employees

There are already exceptions to federal laws in place for small employers, defined as businesses with under 50 employees, as well as exceptions for religious employers such as churches. However, Hobby Lobby, founded by self-made Evangelical Christian billionaire David Green, is an arts and crafts company with about 21,000 employees. The decision in this matter pertains to companies that employ over 50 full time workers, and the mandates that the Affordable Care Act (“ObamaCare”) requires specifically of those employers.

The Hobby Lobby Decision

Green believes that life begins at conception, specifically fertilization, and objected to providing health insurance coverage to his female employees for four specific FDA-approved contraceptives, which he sincerely believes prevents implantation of a fertilized egg, and in his opinion constitutes abortion. Hobby Lobby’s case was consolidated with a case by Conestoga Wood Specialties, a furniture company owned by the Mennonite Hahn family, who hold the same beliefs. Conestoga employs approximately 1,000 people.

In this decision, the Court was careful to denote that the intent of its ruling was to only recognize a for-profit corporation’s claim of religious belief if it is considered to be a “closely held” corporation – not a conglomerate such as IBM or Bank of America (which are publicly traded). “Closely held” commonly refers to a company owned by a few insider shareholders, usually who also occupy the board. Though the ruling only applies to these “closely held, for-profit corporations,” who amass a small subset of the nation’s employers, many believe (based on a dissenting opinion written by Justice Ginsburg) that the ruling may have a more encompassing effect in future.

The Court interpreted the Religious Freedom Restoration Act (RFRA), a 1993 federal act aimed at preventing laws that substantially burden a person’s free exercise of religion. Following RFRA, the court completely overturned the “contraceptive mandate”, a regulation adopted by the US Department of Health and Human Services (HHS) under the Affordable Care Act (ACA), which requires employers to cover specific types of contraceptives for their female employees.

The Court said that the mandate was not the least restrictive way to ensure access to contraceptive care, noting that a less restrictive alternative is already being provided for religious non-profits (who are already exempt from the mandate). The decision was split 5-4 down gender and party lines, and both sides had much to say on the matter.

What Others are Saying

This was clearly a significant decision for employers, so we’ve compiled some thoughts from around the web that provide both neutral tone arguments and a few from opposing sides.

Six Myths And Facts About The Hobby Lobby Decision

Supreme Court Rejects Contraceptives Mandate for Some Corporations

At Supreme Court, baffling decision follows awful Hobby Lobby ruling

Hobby Lobby ruling much more than abortion

Hobby Lobby decision: 5 takeaways

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Employee Criminal background check

Here’s what to look for on employee background checks in the home healthcare industry

If you are a health care industry entrepreneur in Louisiana, you know that a nurse’s aide or a home health aide may be offered temporary employment prior to the receipt of the results of a required criminal history check – as long as they are under the direct supervision of a permanent employee or in the presence of a member of the immediate family of the patient. Then after the background check is completed, the Department of Public Safety and Corrections or authorized agency will provide to the employer only the information as is necessary, including:

  1. If the applicant was arrested for, or convicted of, or pled nolo contendere to any crime or crimes;
  2. The crime or crimes for which the individual has been arrested or convicted or to which the individual has pled nolo contendere;
  3. The date or dates on which the crime or crimes occurred, and
  4. If the applicant has a record containing information which has been expunged (which would include the date of the arrest and a notation that the individual’s record contains expunged information).

However, if you look at Louisiana statutes, Department of Health & Hospitals (“DHH”) regulations, or DHH policies, you may have a hard time finding a comprehensive list of the crimes that disqualify an employee. Louisiana lists specific crimes in pre-employment background check laws with regard to TWIC (transportation) and public schools, but nothing that answers the same question regarding healthcare workers. This means it falls on the business owner to have specific knowledge of what to look out for when reviewing the results of a background check.

If you are attempting to staff a home health care business, how are you are expected to know which former offenders you are still permitted to hire, without any clear guidelines? Also, how would an applicant know whether or not they should apply for certain jobs without any idea of whether they are legally eligible to be hired?

To answer these questions, the Home and Community Based Services division of DHH, upon request, recently provided our firm with an unpublished list of the specific charges which are considered “disqualifying offenses”. The list includes:

If a prospective health worker will be working with clients under the age of 21, these charges also apply:

Employers may also refuse to hire any applicant whose background check reveals a conviction of an offense that includes the distribution of, or possession with the intent to distribute, controlled substances.

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Have you received a “LAT Form” from Jefferson Parish in the mail recently? Don’t let the various tables and “legalese” intimidate you. Although the form may appear complicated and confusing, reporting your movable (sometimes called personal property) taxes is actually quite simple. Whether you conduct business in Metairie, Kenner, Harrahan or on the Westbank, this guide breaks down the process. Let’s start from the beginning.

LAT Form 5

What exactly is “movable property”?

Movable property is any physical property other than real estate which has a monetary value. Examples are inventory, furniture, fixtures, machinery and equipment. LA R.S. 47:2322. Some property, like motor vehicles have their own set of rules and are not considered taxable movable property in Louisiana.

Filing a Property Listing Form and Determining the Amount of the Tax

Like most property taxes, taxes on movable property in Jefferson Parish are ad valorem taxes. Ad valorem is a Latin phrase meaning “to value.” That means that amount of the tax is based on the property’s assessed value. In Louisiana, assessed value on all movable property is 15% of its fair market value. In Jefferson Parish, the law states that every person, association, company or corporation who owns or holds any tangible business personal property is required to report it annually to the parish assessor to determine its fair market value for the current tax year.

Prior to February 15th of each year, the Assessor’s Office, with locations in Gretna and Jefferson, mails self-reporting tax forms, or “LAT forms”, for all movable property. It’s the responsibility of Jefferson Parish citizens and businesses to mail the completed forms back to the assessor. East Jefferson residents should mail their forms to Jefferson, while Westbankers, living in areas like Westwego and Lafitte, should mail their forms to the Gretna office. In Jefferson Parish, unlike neighboring parishes, the LAT form is to be returned to the assessor by April 1st, or 45 days after receipt, whichever is later. LA R.S. 47:2324. Upon written request, the assessor may grant an extension of up to 30 days. If you did not receive your form on time, you can download it from the Louisiana Tax Commission’s website.

The assessor will use the LAT form to gather information to determine fair market value of the property. All movable property must be reported on the form and must also list the acquisition year and cost. The assets are depreciated according to a schedule furnished by the Louisiana Tax Commission.

Disputing the Assessment and Lowering your Tax Bill

For a period of 15 days between the months of August and September, the assessment lists of Jefferson Parish are open for public inspection. During this period, taxpayers are encouraged to check the values assessed to their property. If the property owner wishes to dispute a given valuation, he or she may fill out a “Notice of Appeal Request for Board of Review,” Form 3101, and schedule an appearance before the parish Board of Review for a hearing. The dates of hearings of the Board of Review in your parish will also be published by the assessor in the local newspaper. The Board of Review office in your parish will determine if any changes should be made to the assessment values in question. If either the assessor or the taxpayer is not satisfied with the determination of the Board of Review, either may obtain an Appeal Form, Form 3103.A, for further review by the Louisiana Tax Commission.

However, if the property owner failed to file the LAT report by the due date, the property owner gives up the legal right to contest the determination of fair market value by the parish assessor. LA R.S. 47:2329. Since you may lose those rights if you don’t report on time, it’s important to note this deadline.

Receiving your Bill and Avoiding Interest

Tax bills in Jefferson Parish for movable property are usually mailed in late November. They become due on December 1st and delinquent if not paid or postmarked by December 31st. The interest rate on any delinquent taxes is 1% per month from January 1st until they are paid in full.

Sometimes other charges besides the ad valorem tax may be added to your tax bill. Examples of these other charges include outstanding Parish liens, Louisiana Tax Commission fees, or special security district charges that are a flat amount rather than being based on the value of the property. If the bill becomes delinquent, monthly interest and other charges associated with collecting the bill are also added.

If the property owner has been notified of taxes due, yet has repeatedly failed to make any effort to pay the amount due, his or her property may be seized, advertised, and then auctioned to the public for the total delinquent amount due, including taxes, accrued penalties, interest and costs. All property is then auctioned and sold to the highest bidder for cash, LA R.S. 47:21412142, and the purchaser receives full ownership of the purchased property. LA R.S. 47:2142C. Not unlike a foreclosure “tax sale” on real property, the tax debtor is notified, and the sale is announced to the public through publication in the local newspaper.

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Last week as I was heading into the New Orleans Jazz and Heritage Festival, I noticed a food truck sitting in the parking lot at the corner of Esplanade Avenue and Lopez Street. The truck was giving out free food, and some promoters were asking people to take pictures of the truck, try the food, and share their experiences on Instagram and Twitter. Checkout the hashtag #tasteofnola. What kinda of food truck gives out free food?!

The truck even had Mardi Gras Indians and a prize wheel!

The truck even had Mardi Gras Indians and a prize wheel!

As it turns out, the food truck is an effort by the New Orleans Conventions and Visitors Bureau to promote the city. The Times-Picayune covered the announcement of the truck fairly well. Apparently, the truck will travel across the Southeast to promote the city, and this week will appear in Austin.

I guess you could say that I was more than a bit surprised to see that the City of New Orleans is now using a food truck to promote itself. After all, this is the same city that the food truck industry had to lobby with for over a year just for the right to do business. Before the laws were changed, the City had some of the toughest regulations in the country. Checkout the food truck tag on this blog to see some of those articles.

Even after all that lobbying, trucks still face plenty of restrictions. The number of permits available to mobile food vendors is arbitrarily limited to 100 (at last check, just over 50 were in use). And trucks are still banned from the French Quarter, Central Business District, and Warehouse District unless they go through a “franchise” process. So all those office workers are still too far away to lunch on award-winning tacos, King Cake Burgers, and empanadas.

NOLA has it's very own food truck!

This attorney is pretty happy that NOLA has it’s very own food truck!

Despite those restrictions, it’s nice to see the city jump on the food truck bandwagon. I’m wondering though: does this truck have all the required permits?

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Bed and BreakfastThe website AirBNB allows property owners and leasers to list their homes and apartments for short term rental. Recent press and blogosphere coverage has discussed the proliferation of this service and the convenience it provides to visitors to the city looking for a hotel alternative and residents who want to earn a separate income stream. It’s even a topic I’ve discussed before. If you’re interested in renting out your property, the city provides a quick primer, but does not cite the sources. Here’s a run-down.

To understand the city’s bread and breakfast laws, we need to start with the definitions of a bread and breakfast in the city’s Comprehensive Zoning Ordinance (CZO). So, what is considered to be a “bed and breakfast”? A “bed and breakfast” is defined as “an owner-occupied residential structure, originally constructed as either a single-family or a two-family structure that is easily converted to a single-family structure, which provides sleeping rooms for overnight paid occupancy of up to seven (7) nights.”

There are variants on the different structures seen and permitted throughout the city. For example, there are bed and breakfast family homes, which are limited to no more than 2 sleeping rooms, and bed and breakfast guest homes, that are equipped with 3 to 5 sleeping rooms; subject to a current certificate of liability insurance posted on the premises. Bed and breakfast historic homes contain between 3 and 9 sleeping rooms and are subject to approval by the Historic District Landmarks Commission, at least 3,000 square feet in size and a minimum of 50 years old. Bed and breakfast inns, which can contain as many as 9 sleeping rooms, but do not necessarily have to have historic value, are limited to commercial and neighborhood business districts.

Therefore, assuming you own your home and want to rent a room, you will need to determine your zoning and whether or not a bed and breakfast is a permitted or conditional use in your zoning area. This is determined on a case-by-case basis. Note that this CZO is currently being updated and should become law in summer 2014, so while your zoning may change to allow you to open bed and breakfast, the owner occupancy requirement remains in the current draft. You can determine your property’s zoning by using the New Orleans zoning look up tool.

The city’s Municipal code provides additional guidance on costs. First, anyone seeking to rent property for less than 30 days (or 60 days in the French Quarter) is required to have a permit. The fee for a bread and breakfast with 1 or 2 bedrooms is $200 per year, and the fee for a bed and breakfast rental with 3 to 5 bedrooms is $600 per year. Keep in mind that the actual fees charged by the city may be a bit higher than stated above.

Frequently Asked Questions

Q. I rent my living space from a landlord. Can I sublease my space on AirBNB?

A. No, this practice is prohibited by city law. In order to rent your space, you first need a mayoralty permit. City law requires proof of owner-occupancy in the form of a homestead exemption affidavit before issuing a permit. If you rent your apartment, clearly you won’t be able to claim a homestead exemption.

Q. I purchased a property that I intend to rent exclusively on AirBNB. Is this allowed?

A. No, for the same reason as above. The CZO requires bread and breakfasts to be owner-occupied, so if you don’t live in the house and claim your homestead exemption on the property, you will not receive a permit.

Q. Will I be required to apply for a food service permit to serve meals?

A. No, but in addition to the mayoralty permit required, you will need to apply for a standard business license and submit the usual paperwork to the Bureau of Revenue. The appropriate paperwork is linked on their website.

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The city of New Orleans requires every business operating from a location within Orleans Parish to pay an annual tax. This annual tax is called an Occupational License, and must be renewed between January 1 and the end of February each calendar year. This tax is in addition to annual registration with the Louisiana Secretary of State, sales tax due to the city and state (Louisiana Department of Revenue), and federal taxes.

The city allows businesses to pay the tax in person at City Hall and online. If you found this, chances are you’d like avoid spending an afternoon at the wonderful building on Poydras and Loyola and pay online. Unfortunately, the instructions included on the renewal flyer are limited to listing the city’s general website.

Photo Apr 06, 4 08 29 PM

The city’s instructions to pay online: “Go to nola.gov”

Fortunately though, I’ve had several clients ask about the process, so here’s a detailed guide on how to pay the man.

How to Pay New Orleans Occupational Tax Online

First, you’ll need to go to the City’s online portal and create an account. Click here, and you’ll be taken to a page that looks like the one below. Register for an account, then login.Screenshot 2014-04-08 16.53.06Once you log in to your account, you’ll need to scroll down a bit. You’ll notice a list of services the city has made available online (finally!!), but the one you want to click today is for the Bureau of Revenue. Checkout the red arrow below.

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Click Bureau of Revenue

If this is the first time you’re paying online, you’ll have to connect your business occupational license account to your login credentials. So click the “Add Account” link indicated below.

Screenshot_2014-04-08_16.53.50

Click Add Account

From the Tax Form drop down menu, select Occupational License Renewal, and enter your account code into the field below. Your account code can be found on your Occupational License. If you can’t find it, you’ll probably have to call the One Stop Shop or travel to City Hall.

 

Screenshot 2014-04-08 16.54.07

Enter your account details

It generally takes a day or two for the city to approve the registration. Check back here for Part 2 of paying taxes to the City of New Orleans.

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Generally, most small businesses will initially form their company as a limited liability company. But sometimes, the corporation makes more sense. One of the key questions when determining whether to setup your business as a LLC or a corporation is the number and nature of the investors you  are attempting to attract.

The Entities are Similar, but LLCs are Easier

For the most part, an LLC can perform the same functions as a corporation. It can issue membership interests that are similar to shares of stock, it can assign management to a group, like a board of directors, and it can appoint managers, similar to officers.

So, an LLC operating agreement can be written to make the company manage like a corporation, and since it has less-stringent annual requirements why even use a corporation at all? One reason is registration requirements.

Registration Requirements

The entities differ when it comes to what needs to be reported to the Louisiana Secretary of State. For a corporation, the officers and directors need to be listed with the business. But the investors who own the shares don’t need to be reported. A corporation’s ownership records are kept internally, and never need to be made publicly available. An LLC is different.

Every manager or member of a limited liability company must be listed with the Secretary of State. So every time someone buys or sells an interest in the company, those records need to be updated. That also means that everyone who is either a member or a manager of the LLC is listed publicly. This may make some investors a bit weary.

LLC May Still Be the Better Option

Generally, if your investors are ok with having their names appear on the Secretary of State, and you only plan on having a few investors, the LLC is still probably the better option for you. However, if you plan on having multiple investors, or your investors place a premium on their privacy and publicly available information, the corporation may be the better option.

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A Louisiana woman is suing her brother and sister in a Gretna court to liquidate the family netting and rigging business. The father started Arabi Sling and Rigging Company Inc in 1972, and passed ownership of the company to what appears to be his 2 daughters and his son.

Since 2009, the company’s expenses, and in particular the salaries paid to the executives, have significantly increased, and those increases amount to breach of fiduciary duty, unjust enrichment, wrongful termination and violation of state law, alleges the plaintiff.

The plaintiff has asked the court to liquidate the entire business. Hopefully, the parties are able to come to a settlement that allows the business to survive.

 

Read more about the lawsuit on LouisianaRecord.com.

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The following checklist is designed to flag the many  issues involved in wrapping up an individual’s employment with a company. This checklist assumes that the decision to terminate has already been made or that the employee has voluntarily resigned.

Notify Human Resources

As soon as you are aware of an employee’s intention to terminate employment, notify your Payroll Manager or Human Resources office. When the employee tells you of his or her intention to leave your employment, you should then ask him or her to write a resignation letter that states why he is leaving and his termination date.

Also, have them complete Form 77, provided by the Louisiana Workforce Commission, for unemployment insurance purposes.

Permissions / Access Termination

As soon as you know that an employee is leaving, notify your network administrator or other appropriate staff person of the date and time on which to terminate the employee’s access to computer. Make arrangements for how these accounts will be re-routed to ascertain that your organization will not lose contact with clients and customers.

Effective on the termination date, whether immediate in a firing situation, or at a mutually agreed upon end date, you also will need to terminate the employee’s building access. Depending on your access methods, you will need to disable the employee’s building entry code, disable his or her entry swipe card, or collect the employee’s keys. It is in both your best interest, and the former employee’s, that he or she cannot access any company property.

Return of Property

Exiting employees should be required to turn in all company books and materials, keys, ID badges, computers, cell phones, Blackberries/PDAs, card keys, company cars, parking passes, credit cards, telephone calling cards, laptops, printers/copiers/scanners/fax machines, marketing materials/other files, company phone lists, employee contact lists and any other company-owned items. Consider what procedure will be used to quickly facilitate the return of company property and the retrieval of the employee’s personal property with dignity.

Employees should provide their supervisors with all passwords and other information pertaining to accessing computer files and telephone messages. Is there any company information located on employee’s home/personal computers? You should lock access to the company’s system and backup data prior to the notification meeting, and remove access to external company databases and/or remote access software.

Set up an automatic e-mail notification to alert senders that the employee is no longer employed. Re-route all voicemails to someone available to cover for the employee until a replacement is found.

Status of Benefits and Pay

Terminating employees are usually paid up to a maximum of 30 days for unused, accrued vacation time. If the employee has used time not yet accrued, payment to the company for this time is subtracted from the last pay check. (If your company designates a certain number of sick days and they are accrued, you would also need to pay the employee for the time accrued.)

Following termination, former employees should receive a letter from the Human Resources office that outlines the status of their benefits upon termination. This includes life insurance, health coverage, retirement plans and expense account plans. (In the United States, organizations comply with the Consolidated Omnibus Budget Reconciliation Act of 1980 (COBRA), and extend to eligible employees and their enrolled dependents the right to continue health care plan coverage for a specified period of time at their own expense and at full cost.)

Any unpaid payroll advances will be subtracted from the employee’s final check. Determine if deductions are necessary for unpaid loans, wage over-payments, lost or stolen company property and whether those deductions are allowed by law. Discontinue any automatic payroll deposits.

Determine what “wages” are owed. Any unpaid expenses for company business purposes (turned in on an expense report), unpaid commission and bonuses will be paid in the final pay check.

Coordinate the preparation of COBRA notice, or state law equivalent, with the health insurance provider. Confirm that the health insurance provider allows coverage through the end of the month of termination. Confirm that health insurance provider allows employee to be continued under group plan if continued insurance coverage is to be offered in connection with termination employee benefits. Prepare information regarding rollover of any 401(k) plans and other benefit information and notify carriers/providers of termination. Discontinue Life/Disability Insurance premium payments and notify carrier(s) of termination. Determine if any action should be taken regarding any applicable medical reimbursement or dependent care reimbursement plan promissory notes.

In going over acquired benefits, consider past practices, verbal commitments, any written documents or e-mail correspondence, what is stated in the offer letter/employment agreement, company policies or any handbook, etc.

Confidentiality and Non-compete Agreements

Any confidentiality agreement or non-compete agreement that the exiting employee signed when commencing employment should be reviewed to make certain the employee understands what is expected.

Even if the employee never signed such a document, most employee handbooks have a clause or code of conduct paragraph about not sharing company confidential information or trade secrets. Review this and remind the employee that any breech of this confidentiality will be addressed.

Things to Review at the Exit Interview

Exiting employees are encouraged to participate in a confidential exit interview with the Human Resources department. (Exit interviews are an important process you can use to gather information regarding the working environment in your organization.) When notified that an employee is terminating employment, your HR office should schedule an exit interview.

If the separation is involuntary, you should discuss appropriate details regarding termination (effective date, business reasons for termination, pay and benefits after termination, if any, unemployment benefits eligibility, etc.) with the employee. Exiting employees, who plan to seek employment, must sign a form giving the company permission to provide reference information when potential employers call.

Give the employee an address update form to fill out if they move. This goes especially for large companies, or those with high turnover, because W-2s will come back as non-deliverable if the address has changed. Without new contact information, it is difficult to provide needed information to the former employee. As a backup, verify that the employee’s emergency contact information is up-to-date and that you can contact that person to locate them if you have trouble getting their W2s to them.

These are simple, but important, tasks to remember. If you follow these guidelines, the difficult process of releasing an employee should go as smooth as possible in the future.

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Contract and Pen

Sign your contracts the right way, every time!

The primary reason most businesses form a limited liability company (LLC) is to avoid personal liability for business dealings. Unlike Louisiana’s strict corporate formalities, Louisiana law does not impose strict formalities on LLCs, but that doesn’t mean just having an LLC will protect you.

If you sign a contract with the intent of binding your business, but don’t mention your business in the contract or signature block, you may actually be binding yourself to the contract, personally. That’s an easy way for a plaintiff’s attorney to get around your LLC (“piercing the corporate veil” in legalese) in a dispute. Avoiding this is easy.

Sign Contracts the Proper way, Every Time

Whenever the owner, members, managers, or officers sign a contract, document, letter–anything!–on behalf of the LLC, the LLC’s name should be in the signature block and the person signing should indicate their title. This is an example of an appropriate signature block:

[LLC name]

By: __________________________
Name: [name of individual] Title: [Member, Manager, etc.]

Or, for a real example

Andrew Legrand Law, LLC

By: /s/ Andrew Legrand
Andrew Legrand, Member

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