Any business structure or corporation stands firm on its foundation laid by the employees. An LLC is no exception to this rule. Hiring employees in your LLC comes with some rules, regulations. Before understanding the rules of hiring employees in Louisiana LLC, we must understand what an LLC means.
A Limited Liability Company is a business structure that protects the owners from any personal responsibility of the debts or liabilities arising out of the LLC. If an employee action succeeds to liabilities, the owners get the protection against it. LLCs are a combination of the characteristics of a partnership firm & a sole proprietorship.
On this page, you’ll learn about the following:
- Hiring Employees in Louisiana
- Can an LLC Hire Employees?
- Laws Relating To Wages Of Employees
- Rights of The Employees in Louisiana
Hiring Employees in Louisiana
In order to hire employees in LLC in Louisiana, there are many requirements that a business has to fulfill. One should keep these points in mind while hiring employees in an LLC. These requirements include:
1. Federal & State Employment posters in Louisiana
The employers in Louisiana are required to show both Federal & State Employment posters mentioned in Equal Employment Opportunities Act, Americans with Disabilities Act, Fair Labour Standards Act (FLSA), etc. You should seek professional help to fulfill all the norms or requirements.
2. Federal & State Required Forms
Hiring employees is a lengthier process that involves the filing of different forms & applications. Suppose you wish to hire employees in Louisiana. In that case, you must ask your employees to submit the Employment Eligibility Form, the Federal Tax withholding form, the W-4 Form, Workers Compensation Claim Form, Disability Self- Identification Form, U.S. Citizenship and Immigration Services Form, etc. These Legal forms are easy and free to download.
3. Requirements of Louisiana New Hire Reporting program
Employers of Business owners are bound by Louisiana’s New Hire Reporting Program, under which they have to submit a report consisting:
- Company Name
- Company Address
- Company federal tax ID number
- Employee’s Name
- Employee’s Social Security Number
- Employee’s Address
- First Day of paid Work
In addition to the forms mentioned above, payments, taxes, tax forms, & requirements, there may be some additional compliance for hiring in Louisiana; you must adhere to those norms as well.
Can an LLC Hire Employees?
An LLC or a Limited Liability Company can be regarded as a corporation, partnership, or sole owner business. The owners of the LLC are often referred to as members. Individuals, Corporations &, in some cases, other LLCs can form an LLC as members.
The members form LLCs because of their limited or no liability provided to the owners or members. In the event of liabilities arising out of an employee’s action, the members of the LLC are not personally liable- the LLC is liable for the actionable claim.
Any LLC (even one with a single owner) can hire unlimited employees on wages or salary. (The single-member owner LLC may have different rules and regulations). In addition to the salaried employees, the LLC can appoint Independent contractors for certain tasks on a contract basis.
Rules to Hire Employees in an LLC in Louisiana?
Just like any other business corporation, an LLC is also not immune from certain procedures & rules of hiring. An LLC files many documents & pays a number of taxes to various Government Agencies while hiring employees. Some of the essential rules or steps to hire employees in an LLC are:
- Federal Employer Identification Number – Every LLC must obtain an Employer Identification Number (EIN) from the Internal Revenue Service. EIN helps report taxes & a few other documents to the IRS.
- Employee Eligibility Form – It is mandatory for an LLC owner to check if the employee is eligible for employment in the U.S. An LLC has to ask the employees to submit the I-9, Employment Eligibility Verification Form to verify the identity of the employee & to authorize the employment. the I-9 form is a mandatory requirement while hiring an employee.
- Employee’s Social Security Number – The employee has to have a valid Social Security Number (SSN) to work. LLCs have to ask the new employees to submit their SSN before employment. The SSN is helpful in payment & tax purposes.
- Setting up a process for collection & payment of the appropriate taxes – There has to be a due process for the employees’ future collection & payment of taxes. This process needs to be set up by the employer (in this case, the LLC)
- Employee handbook – In the hiring process, one of the crucial elements of hiring paperwork is an Employee Handbook. Although it is not essential in Louisiana, it is usually needed as one of the legal documents in many other states. An Employee Handbook consists of a complete list of all the basic rules & policies of the company.
- Louisiana payroll Taxes – An LLC that is running a business with employees or businesses with employees has to pay many federal taxes & state Taxes. Following the rules on payroll taxes is also an essential requirement. After hiring employees, an LLC is subject to the State Unemployment Compensation Act. Under the said Act, an LLC will have to pay Unemployment tax to the state & to do that; the LLC must register itself with the Louisiana Workforce Commission. The process involves simple steps & can be completed in 20 minutes.
Payroll taxes also include Federal Income Tax withholding, an employer can withhold money from the employee’s account for the income tax.
- Workers’ Compensation Insurance An LLC operating in the state of Louisiana has to carry workers’ compensation insurance & has to display relevant posters.
- New Hire Report or Report of the New Employee – An LLC has to
- Report about hiring the new employees in the form of “Report of New Employee(s)” to the Louisiana Workforce Commission within 20 days from the date of hire.
- Deposit and report federal employment taxes as per the IRS procedures for payroll reporting & payment.
Laws Relating To Wages Of Employees
Louisiana labor laws provide minimum wage, overtime pay, payday standards, union memberships, etc. State statutes also determine which are the legal holidays for employees, as well as the pay rate during holidays and overtime hours.
- There is no state determined minimum wage in Louisiana. Employers operating their businesses in the State of Louisiana shall pay their employees at a minimum rate of $7.25 per hour.
- Employers must compensate employees for scheduled breaks of less than 30 minutes.
- Labor restrictions set by federal and state legislation must be followed by all business LLCs and corporate employers.
Structure Of Wages Of Employees
Louisiana companies must adhere to compensation requirements established by the federal Fair Labor Standards Act (FLSA). The hour and wage restrictions are also part of the standards. We have listed below the major aspects of the wage structure followed in the State of Louisiana.
Louisiana Minimum Wage
Louisiana does not have a state-mandated minimum wage. It follows the federal minimum wage which currently is $7.25 per hour. Employers must pay employees at the highest minimum rate stipulated by state, federal, or municipal legislation. However, there are certain exemptions to the minimum wage rule in Louisiana.
- Tipped Employees: Employers have the authority to pay employees who earn tips a lower hourly rate if the wage plus tips meets the entire minimum hourly wage. Employers in Louisiana can pay tipped employees as little as $2.13 per hour.
- Trainers and Learners: Because Louisiana has no minimum wage legislation, companies are free to offer subminimum wage rates to trainees and student learners.
Louisiana Overtime Wage
The State of Louisiana does not have its own enacted regulation covering the wage rate and overtime pay for employees working in the State. For overtime compensation, employees are covered under the Fair Labor Standards Act (FLSA), which requires employers to pay 1.5 times the usual pay rate of the employees for any hours worked after the first 40 hours in a workweek. Commission and sales employees are exempt from the class of employees who are eligible to receive overtime pay.
Work hours of children under the age of 16 are strictly regulated in the State. Employers are prohibited from employing children to work beyond 3 hours during their school days and more than 8 hours on non-school days. In total, the minors should not work beyond 18 hours during a school week, and for more than 40 hours in a non-school week, or outside of the hours of 7 a.m. and 7 p.m. All minor workers are entitled to a food break between 5 hours work schedule.
Rights of The Employees in Louisiana
Employees’ rights in Louisiana are to protect them from getting exploited. These rights are governed by the State and should be followed by all the LLCs.
The Louisiana Employment Discrimination Law (LEDL) forbids employers from discriminating against employees based on protected characteristics such as color, sex, disability, age, gender, nationality, race, religion, etc.
Upon termination of an employee, whose employment is terminated either voluntarily or involuntarily, must be compensated by the following normal payday or 15 days after separation, whichever comes first. If the business has a policy that allows it, the final check should include reimbursement for any accumulated but unused vacation days.
Time Off and Leaves of Absence
Many businesses provide paid leave in the form of vacation time, sick days, or paid time off, but the benefits are up to the employer’s discretion. Employers may be compelled to provide unpaid leave for a variety of reasons, including jury duty, military duty, and family reasons.
The Family and Medical Leave Act mandate firms with at least 50 workers to provide qualified employees with up to 12 weeks of unpaid time per year. Caregiving, bonding with a new kid, and illness are all covered under the statute. Employees in Louisiana are entitled to time off for disabilities connected to pregnancy, delivery, and medical issues associated with either condition.
All businesses are required by the federal Occupational Safety and Health Act (OSHA) to maintain a safe workplace for their employees. They are responsible for providing the appropriate training and safety equipment for their industry to the employees to avoid any kind of mishaps from happening at the workplace.
If employees believe their company is breaking safety regulations, they have the authority to request an OSHA inspection. Employees who report such unlawful activities of their employers are protected against any retaliation by the employer against employees under the whistle-blower protection laws.
How to Hire Employees Fast in Your Louisiana LLC
If your business is growing, you will need to hire employees, but the process of hiring new people can be intimidating. It is important to have an understanding of exactly what job responsibilities each employee will be responsible for. Some companies simply hire people for a specific task without having any clear idea of what those responsibilities will be. Instead, look one to three years into the future and create an organizational chart based on your goals. Write down the titles of the positions you’ll be hiring and their descriptions.
As an LLC, you’ll need workers’ compensation insurance and display appropriate posters for your employees. You’ll also need to file a new hire report with the Workforce Commission within twenty days, report federal employment taxes, and follow labor laws and state statutes regarding legal holidays for employees. The LLC can be treated like a corporation, a partnership, or a sole proprietorship, depending on the number of owners. By hiring employees and creating a comprehensive employment manual, you’ll be able to streamline your hiring process and increase your bottom line.
The first step in hiring employees is to register with the Louisiana Workforce Commission. This registration takes just twenty minutes and involves filing the necessary forms. You should be aware of the requirements to hire employees in Louisiana, including the minimum wage, hiring young workers, immigrant workers, and the IRS guidelines for independent contractors. You should also understand the laws regarding hiring employees, as well as the various requirements for paying minimum wages, overtime, and payday standards. Lastly, you need to keep the employee files for four years and retain employee ID numbers.
An LLC is a business entity that can be treated as either a corporation, a partnership, or a sole owner business.
The owners of the company are not personally liable for the actions of the employees, the LLC is liable for any such actions.
Before hiring an employee, under federal law, the business has to verify an employee’s eligibility to work in the United States with the (IRS Form I-9). The business owner also has to make sure the employee has a valid SSN or Social Security Number.
LLC members, or LLC owners, are self-employed according to the IRS because they pay themselves through the earnings of LLC.
All the LLCs with employees are bound by many rules and regulations with reference to wages. It is always advisable to register a registered agent service to understand the laws better. Feel free to share your feedback with us in the comment section below.