Talent Management - July 2008 - (Page 51)

courage businesses to hire individuals receiving public assistance or those that face barriers to employment. Created in 1996 as part of the Small Business Job Protection Act, WOTC allows employers to earn a federal income tax credit based on the wages of certain categories of disadvantaged workers, such as former welfare recipients. The credit helps employers with some of the additional costs associated with training and retaining disadvantaged workers while moving people from welfare to employment. For a new hire to qualify an organization for tax credits, the person must meet the proﬁle of any one of nine targeted groups designated by the federal government. These groups include temporary assistance to needyfamily recipients; food stamp recipients; residents of federal empowerment zones and enterprise and renewal communities; qualiﬁed veterans; ex-felons; and supplemental security income beneﬁt recipients. Businesses can earn up to $2,400 for each qualiﬁed adult new hire and up to $9,000 for each long-term family assistance recipient hired over a two-year period. WOTC is calculated by hours worked and wages earned for each employee certiﬁed by the appropriate state agency as WOTC eligible. As with most general business-tax credits, WOTC has a carryback period of one year and can be carried forward up to 20 years. To determine if potential new hires are eligible for WOTC, talent managers must ask job seekers to complete IRS Form 8850 during the application process. The employer has to submit the form and all supporting documentation to the appropriate state agency within 28 days of the new employee’s ﬁrst day of work. After receiving certiﬁcation from the state agency that the employee is WOTC eligible, the employer tracks wages earned and hours worked to calculate the credit. Coordinating the appropriate paperwork and submitting the necessary information to the appropriate state agency can be a time-consuming process prone to errors and can ultimately result in lost ﬁnancial opportunities. Integrating tax-credit screening with a hiring management system allows organizations to build consistency throughout all processes, speed up on-boarding, ease hiring managers’ workloads and, ﬁnally, add tangible assets to the bottom line. While tax-credit programs often are championed at the corporate level, they do require participation at each relevant business division or property. For instance, in the retail industry, integrating tax-credit screening into a hiring management system can standardize processes across all retail stores in a chain and help ensure all new hires are screened for tax-credit eligibility. Beyond the hard-dollar return of tax credits, integrating tax-credit screening into an organization’s hiring management system can create operational efﬁciencies, including a 94 percent reduction in paperwork. Hiring managers in particular will see real time-savings beneﬁts. Aside from the reduction in paperwork — as they will only process information for new hires that have been screened as potentially eligible — an integrated system also can print pre-populated tax-credit forms as part of the new-hire paperwork package. The new hire signs the paperwork, and a hiring manager submits the forms to an outsourcing partner who coordinates certiﬁcation with the appropriate state agency. There’s also reduced printing expenses, reduction in salaries paid to HR and talent management employees, as well as the option to reduce the number of operational staff on hand to oversee the paperwork. Turning Promise Into Practice To get a clearer picture of the value capitalizing on these credits can represent, take the example of a retail organization that brings approximately 60,000 new employees on board each year. For companies that recruit large numbers of employees, particularly at different skill levels in an array of locales, there usually DASHBOARD continued on page 55 talent management magazine www.talentmgt.com 51 July 2008 http://www.talentmgt.com

Table of Contents Feed for the Digital Edition of Talent Management - July 2008

Talent Management - July 2008 Editor’s Letter Human Performance Leading Edge Learning Connections Guest Editorial Passive Candidate Recruiting: Evolving with a Changing Workforce How Do They Feel? Sec Regulations and Executive Compensation Performance Management: A Retail Perspective Train the Non-Trainer Management-Go-Round: Developing Future Leaders Netflix Creates Its Own Script for Talent Management Intuit Spotlights Strategic Importance of Global Employee Recognition Make HR a Profit Center: Automate Technology to Gather Tax Credit Data Offshoring and the Impact on Talent Management Advertisers’ Index Editorial Resources Full Potential

Talent Management - July 2008

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