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Can small businesses survive the Fair Labor Standards Act changes on overtime

BRIDGEWATER, MA…

Effective December 1, 2016, an estimated 4.2 million workers will be eligible for overtime pay, according to the changes to the Fair Labor Standards Act (FLSA) overtime rules. Those eligible include salaried employees earning between 23,660 and $47,476 and highly compensated employees with an annual salary between $100,000 and $134,004. The new rules have more than a few large, medium and small-businesses scrambling to prevent the new rules from dramatically impacting their bottom line.

“Being a salaried employee was like a blank check for owners in terms of staffing. If staff was needed to stay late or work on the weekend, a salaried employee wouldn’t cost them extra,” said Mark Kilduff, president of Remote Quality Bookkeeping. “The new rules put the onus on a company’s operations and accounting departments to track overtime hours for salaried staff and make sure paying overtime doesn’t wipe out the bottom line.”

The new overtime rules do not affect every salaried employee. Some can be classified as exempt if they meet all of the following requirements: paid on a salary basis; paid a salary that meets or exceeds the minimum requirement; paid their full salary in any workweek in which they perform work; perform specific job duties that are considered executive, administrative, professional, computer, or outside sales.

“The good news about the new rules is that companies have known since May that these new rules were coming. The bad news for some companies is that they have only had since May to prepare for this,” said Kilduff. “The better news is that the rule changes will force companies to examine their operations and books to better prepare for the coming year and that’s always a good thing.”

For more specific details on whether or not employees are exempt can be found on the Department of Labor’s website, https://www.dol.gov/whd/overtime/final2016/overtime-factsheet.htm

Remote Quality Bookkeeping provides clients with a resource where they can outsource a few bookkeeping tasks or their entire accounting and bookkeeping department. Remote Quality Bookkeeping’s team approach ensures that the books are accurate and up-to-date all for one low monthly fee.

Remote Quality Bookkeeping hosts data on secure servers providing clients with a safe haven accessible from anywhere at any time. This allows accessibility and peace of mind so business owners can focus on their business.

Remote Quality Bookkeeping is located at 12 Spring Terrace, Bridgewater, MA 02324. For more information, call (508) 889-0201 or visit www.myrqb.com.

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SmartBooks Corp. launches IT division

Calvin Wilder, CEO of SmartBooks Corp.
Calvin Wilder, CEO of SmartBooks Corp.

CONCORD, MA…

SmartBooks, a Concord, MA-based firm that provides outsourced accounting and bookkeeping services, recently formed an IT division to better serve IT managed service providers (MSPs). The new division features accountants dedicated to IT companies, as well as support and resources for MSPs.

The division builds on the experience of CEO Calvin Wilder, who as a founder of Thrive Networks, an IT managed service provider (MSP) that was acquired by Staples, helped develop the managed services business model, build out the metrics and financial processes, and scale from 3 founders to 65 employees, all the while maintaining profitability and positive cash flow.

“IT MSPs have the dual pressure of keeping their clients’ systems up and running while simultaneously managing their own businesses and making sure that invoices go out, bills get paid, payroll is met, and financial performance is assessed and managed. That can be a difficult balance to achieve when your clients expect near immediate response to IT situations and crises,” said Calvin Wilder, CEO of SmartBooks. “With our similar business model—outsourced bookkeeping, accounting and payroll services—and our history with IT MSPs, our new IT division provides IT MSPs with an affordable option that will keep their business running while they help their clients stay up and running.”

In addition to general bookkeeping and accounting provided to all clients, some of the enhanced services offered to MSPs by the new division include: client profitability analysis; key performance metrics such as Gross Margin, Labor Efficiency Multiple, Contribution Margin, Cost of Client Acquisition and overhead rates; and support of ConnectWise and Autotask.  As SmartBooks works with numerous companies in the industry, this includes comparing results against industry benchmarks.

As an added service, SmartBooks’ IT division can help clients with budgeting by setting annual financial goals and tracking actual results vs. budget to gauge how well the business is performing against the annual plan.

SmartBooks will also provide forecasting services for IT MSP clients. The annual forecast can be updated either weekly or monthly. SmartBooks reporting can be set up to display forecast vs. budget or forecast vs. metrics goals.

“There can be a frenetic nature to IT MSPs. They receive a lot of ‘urgent’ calls from clients and have to put out a lot of fires. Rightfully so, that becomes top priority. Unfortunately, it does not provide them as much time as most companies would like to take a big picture look at things,” said Wilder. “With SmartBooks behind them, we can be the ones to provide that information and even go so far as to analyze the profitability of each business line and client on a monthly and cumulative basis.”

SmartBooks Corp. provides bookkeeping, accounting, payroll and finance solutions tailored to the needs of each client for a fixed monthly price. The price is driven by the volume, complexity, and mix of services provided.

For more information on SmartBooks services, visit www.smartbookscorp.com or call 978-202-3064.

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