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 South Carolina 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 South Carolina
- Can an LLC Hire Employees?
- Laws Relating To Wages Of Employees
- South Carolina Employee Rights
Hiring Employees in South Carolina
In order to hire employees in LLC in South Carolina, 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 South Carolina
The employers in South Carolina 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 South Carolina. 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 South Carolina New Hire Reporting program
Employers of Business owners are bound by South Carolina’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 South Carolina; 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 South Carolina?
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 South Carolina, 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.
- South Carolina 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 South Carolina 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 South Carolina 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 South Carolina 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
South Carolina doesn’t have any state-mandated labor laws. The State follows the federal regulations which protect the employees from any kind of discrimination and ensures payment of minimum wage, overtime pay, right to family leave, etc. The provisions relating to the rights of the employees are governed by the Fair Labour Standards Act.
- The federally determined minimum wage applicable in the United States is $7.25 per hour. This federal minimum wage rate is uniformly applicable across the State of South Carolina unless the employers and employees are exempted by any specific Federal or State law.
- Discrimination and retaliation against employees in a range of protected classifications are considered illegal in South Carolina.
- Employers in South Carolina are required to provide proper final pay to the employees once their employment terminates.
Structure Of Wages Of Employees
The State of South Carolina is guided by federal laws on matters involving employer-employee conduct. Listed below, we have mentioned the key provisions that structure the employee wages in the State.
South Carolina Minimum Wage
South Carolina does not have a state-mandated minimum wage. Because most firms and employees in South Carolina are covered by the federal Fair Labor Standards Act, the federal standard minimum wage would usually apply. The federal minimum wage is currently $7.25 per hour.
- Tipped Minimum Wage: There are no minimum wage or overtime rules in South Carolina, hence there is no tipped minimum pay. Thus, the federal tipped employee wage of $2.13 applies throughout the state. The final wage pay of such employees should add up to the minimum wage rate of $7.25 like the wage rate of regular employees.
- Trainees and Learners: The employers in the State of South Carolina shall pay the subminimal wage rate applicable under the federal law for students and learners.
South Carolina Overtime Rate
The payment of overtime in South Carolina is not regulated by the state’s labor laws. The federal overtime laws are in effect. When an employee works beyond the 40 hours schedule in a given workweek, then they must be compensated for the extra hours at an overtime rate of 1.5 times their usual pay rate, as per federal law.
Young children of 16 to 17 years of age can work for a usual number of hours without any restrictions. However, they are also prohibited from working for any dangerous occupation. The minor children up to the age of 14 and 15 years old shall not be allowed to work for more than 3 hours per day and 18 hours per week. During holidays or no-school season, children can work a maximum of 8 hours per day and no more than 40 hours per week.
South Carolina Employee Rights
Federal and state laws protect employee rights during their employment in South Carolina. The laws aim to strike a balance in the bargaining powers between the employers and the employees. On similar grounds, the State offers certain rights to the employees in South Carolina.
Employers in the State are subject to the South Carolina Human Affairs Law (SCHAL). The SCHAL outlaws discrimination in the workplace based on protected characteristics such as race, color, caste, creed, religion, nationality, handicap, and sex.
The federal Occupational Safety and Health Act of 1970 (OSHA) outlines rights and responsibilities for employers and employees in the area of workplace safety and health. Employers are required by OSHA and its rules to provide a workplace free of any foreseeable risks and hazards that cause or are likely to cause substantial injury. If an employee sustains any injury or damage due to workplace hazards, they can bring an action against the employer and seek compensation for their losses.
According to the South Carolina Whistleblower Laws, employers cannot fire or retaliate in any manner against an employee who makes a complaint, initiates a proceeding, or testifies concerning workplace occupational safety and health legislation, rules, or regulations to any law enforcement body or a governmental agency.
Paid Time-off and Leave of Absence
In South Carolina, an employer is not required by law to give paid sick leave or vacation days. A corporation that has a policy in place for these perks must follow it without exception.
- Employees in South Carolina are subject to a few rules regarding mandated time off and leaves of absence during maternity leave, jury or military duties, a victim of crime, or an emergency responder leave.
- Employers may be compelled under the Family and Medical Leave Act or other federal statutes to offer an employee with unpaid job-protected leave to take care of a family member or if there exists an emergency medical condition.
Employees whose employment is terminated or laid off must be paid all unpaid salaries within 48 hours after being fired or put off.
How to Hire Employees Fast in Your South Carolina LLC
To hire employees for your South Carolina LLC you need to verify if the person is eligible to work in the US and then report him/her as ‘new hires’ to the state.
If you are a member of an LLC in South Carolina, you may be wondering how to hire employees fast and efficiently. Although hiring employees can be a lengthy and stressful process, it doesn’t have to be. Following a few simple steps can help you get started with your new employee. Below are some of the key steps involved in hiring new employees for your South Carolina LLC. They include: * Establishing a company handbook
* Get an EIN. You’ll need an EIN (also called an employer identification number) to start doing business in South Carolina. This is the same number that you’ll need to register with the IRS. Once you’ve created your account with the IRS, you can begin hiring employees. Once you’ve hired your first employee, you’ll want to set up payroll and benefit from the benefits offered by payroll services. Remember that the state of South Carolina requires all employers to register their payroll accounts with their EIN.
You should also ensure that your LLC registers with the state Workforce Commission. This allows you to avoid delays in hiring employees. When you hire employees, you should follow the rules and regulations of the state. You must be registered with the Workforce Commission in South Carolina before you hire anyone. There are only a few steps involved in this process, and they’ll take you around 20 minutes. Remember, hiring employees should be done only if you have a legal business entity in South Carolina.
* Get an operating agreement in place. While an operating agreement is not mandatory for South Carolina LLCs, it is highly recommended. It is a legal document that outlines how the LLC functions, including how members vote, and how to dissolve the company. By signing an operating agreement, you’ll have peace of mind, which is important if you’re hiring employees. Also, a signed operating agreement is an important document that protects your limited liability status and ensures a smooth operation.
* Establish an EIN. EIN is the social security number of your LLC. It’s needed when hiring employees and registering for tax purposes. You can get one by contacting the IRS, filling out a form online, or mailing a copy to your local office. This document will protect your company’s assets from any missteps by employees. In addition to an EIN, you can register your South Carolina LLC with the state sales tax.
* Make sure to file the proper forms. An EIN is a nine-digit number assigned by the Internal Revenue Service (IRS) to identify a company. This number is essentially a business’s Social Security number. It is also known as a Federal Employer Identification Number or a Tax ID. If you are a member-managed LLC, you can file for a Certificate of Good Standing to make sure you are in good standing.
Choose a registered agent. This person must live in South Carolina or be employed by a South Carolina registered agent. He or she must have a South Carolina operating address and can receive mail and calls on the company’s behalf. The South Carolina secretary of state makes the process simple. Additionally, an LLC is required to designate a registered agent in South Carolina. These professionals charge a fee for their services, but the added security is well worth the expense.
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.