Hiring Employees in Washington LLC – Wages, Laws, Compliance Guide


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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 Washington 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. 

Hiring Employees in Washington

In order to hire employees in Washington State LLC, 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 Washington

The employers in Washington 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 Washington. 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 Washington New Hire Reporting program

Employers of Business owners are bound by Washington’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 Washington; 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 Washington?

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 Washington, 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.
  • Washington 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 Washington 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 Washington 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 Washington 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

Minimum employment protection criteria, such as the federal minimum wage and anti-discrimination laws, are established by the federal government. States generally have their own employment rules that either complement or supplement federal restrictions. The State of Washington regulates the employer-employee relationship in the State through the State-enforced laws in addition to the federal legislation.

  • The minimum wage in Washington is greater than the federal minimum wage. The state’s minimum wage is $14.49 per hour.
  • Discrimination and retaliation against employees in a range of protected classifications are illegal in Washington.
  • Minimum wage, overtime, meal and rest breaks, and child labor are all regulated in Washington.
  • Employers must ensure a safe and secure working environment for their employees under Washington law, which includes adopting a documented accident prevention policy.
  • Employers in Washington must comply with relevant final pay after an employee’s employment terminates.

Structure Of Wages of Employees

Washington employment rules and regulations are covered in this section, including state civil rights legislation, payroll requirements, legal holidays, whistleblower protection acts, and labor laws impacting unions.

Washington Minimum Wage

The current minimum wage in Washington is $14.49 per hour. Washington minimum wage rules demand an annual review of the minimum wage beginning January 1, 2021. It needs to be increased at the same pace as the expense of living. Each year, the evaluation must be completed by September 30.

  • Tipped Minimum Wage: Washington is one of just seven states that does not establish a separate minimum wage for tippers. Therefore, the tipped employees must be paid at least $9.47 per hour, regardless of the amount of tips they get. This is different from the federal minimum wage for tipped employees, which is $2.13 if the employee’s total revenue is equal to or more than $7.25.
  • Student Learners: Employers can pay learners a subminimum wage of no less than 85% less than the statutory minimum wage provided they get a special certificate from Washington’s Department of Labor and Industries.

Washington Overtime Wage Rate

For all hours performed in excess of 40 in a week’s worth of labour, Washington employment rules compel a firm to provide extra compensation to employees at a rate of 1.5 times the worker’s usual rate of pay.

Child Labor

During school days, children aged 14-15 are permitted to work for 3 hours per day and 8 hours on weekends, for a total of 16 hours per week and 6 days per week. During holidays, minors may work for 8 hours a day and 40 hours a week for 6 days a week.

When school is in session, minors aged 16-17 are permitted to work for 4 hours per day and 8 hours on weekends, for a total of 20 hours per week; on non-school days, they are allowed to work for 8 hours per day and 48 hours per week. Working in hazardous situations is prohibited for all children.

Washington Employee Rights

Employers in Washington must follow the state’s labor standards while hiring personnel. Workers and employees have many rights under the laws. The following are some of the key laws that provide employees in Washington with a variety of rights.

Rights Against Discrimination

Employers are subject to the Washington Law Against Discrimination. Discrimination based on race, caste, creed, colour, religion, nationality, handicap, sex, and other considerations is prohibited in the workplaces by the employers.

Equal Pay

A Washington employer may not pay a female employee less than a similarly employed male employee or discriminate in any way in the payment of wages between the sexes when the employees are provided similar working conditions and same amount and quality of work.

Whistleblower Protection

Washington and federal laws make it illegal for businesses to fire or discriminate against employees who participate in public policy-protected behavior. Those who are courageous enough to denounce the wrongdoing of their employers should be protected against any form of retaliation in their occupation.

Occupational Health and Safety

The ‘Washington Industrial Safety and Health Act (WISHA)’ is a state law that requires all companies in Washington with one or more employees to develop and implement a documented accident prevention policy (safety and health plan). Most businesses are required to have safety and health committees.

The Paid Family and Medical Leave programme (PFML) is a statewide insurance programme run by the Employment Security Department (ESD) that provides qualified employees with paid family and medical leave for 12-16 weeks depending on the circumstances.

Exit Pay

Employers must settle the accounts and all the pending amounts of the employees who are dismissed, quit, or laid off maximum by the end of the pay month.

How to Hire Employees Fast in Your Washington LLC

If you want to hire fast in your Washington LLC, you need to follow certain steps. First, you should obtain the Employer Identification Number (EIN). An EIN is like a social security number for your business. This number is required by the Washington state government and the IRS. You can obtain it for free online through the IRS website. Follow the instructions in this guide to get your EIN. You can then hire employees.

Once you have hired employees, you must set up a payroll system. To make it easier on yourself, you can use payroll software. This software can help you keep accurate records and manage your payroll. You can either do this yourself or delegate it to an accountant. Regardless of the type of employee you hire, you will need to establish a pay period, determine compensation for variables, and account for deductions.

Next, you need to choose a name for your Washington LLC. It should be unique among Washington businesses. You can either choose a name by going online or by sending a paper application. Once you have your name, you can hire employees. There are many companies online that offer this service. If you’re thinking about setting up a Washington LLC, it’s important to choose a name that sounds professional. You can also search for free LLC formation services on the Internet. You can find hundreds of national and local LLC formation sites online. Then, fill out an application with your information and wait for the Secretary of State to issue your license.

Lastly, you must choose a registered agent for your Washington LLC. A registered agent is a person or a company who accepts legal documents and serves as a recipient for the LLC. The person or company is the registered agent and must be an active resident of Washington. You can also choose an individual within the company as the registered agent. If you choose to use a registered agent service, you should make sure they are available during business hours.

FAQs

What Is an LLC?

An LLC is a business entity that can be treated as either a corporation, a partnership, or a sole owner business.

Is the LLC liable for damages caused by employees?

The owners of the company are not personally liable for the actions of the employees, the LLC is liable for any such actions.

What is the IRS Form I-9?

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.

What is LLC self-employment?

LLC members, or LLC owners, are self-employed according to the IRS because they pay themselves through the earnings of LLC.

In Conclusion

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.

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