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Overtime pay laws are changing, are you ready for them?

(EMPLOYMENT) The Department of Labor announced new laws for overtime pay; it’s definitely not too soon to make sure that you are ready for the change.

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overtime pay

This past September, the Department of Labor announced new laws for overtime pay. These laws take effect on January 1, 2020; so it’s definitely not too soon for your company to take a look at your employees’ salaries and make sure that you are ready for the change.

As you probably already know, the Department of Labor requires employees who make a certain salary to be paid at 1.5 their normal hourly rate any time they work more than 40 hours in a week. This most recent change has reset the minimum salary for exemption from overtime pay laws to $646 per week or $35,538 annually. If an employee makes less, you are legally required to pay at the 1.5 overtime rate if they work more than 40 hours in any given week.

This is the first change in the exemption minimum since 2004. In 2016, the Obama administration attempted to raise the minimum to $47,476, but this was struck down by the court. However, this most recent change is based on the 20th percentile of salaries, which is exactly how the Department of Labor made the calculation in 2004. Because the Department of Labor used the same method to calculate the new minimum, it is unlikely to face an opposition from the court.

The Department of Labor estimates that 1.2 million employees will become eligible for overtime pay under the rule change. Most likely to be affected are workers who put in a lot of hours for a low salary, such as managers of shops and restaurants, people who work for nonprofit organizations or political campaigns, and even some part time workers.

Suzanne Lucas at Evil HR Lady breaks down the details of the eligibility requirements, and provides great tips for businesses to make sure they are ready to comply with the new rule change as of January 1.

She recommends reviewing every employee who currently isn’t eligible for overtime to figure out whether or not they will become eligible under the new law. If a newly eligible employee is paid a salary rather than an hourly wage, you will need to divide their annual salary by 2080 (that’s 40 hours per week for 52 weeks in the year) or divide their weekly paycheck by 40 to discern the hourly rate. The employee will need to start tracking their weekly hours, and if they work more than 40, you will be required to pay them at a 1.5 rate. If the employee rarely works extra hours, their paycheck won’t change much; but if they do, you’ll end up paying them more each week than you did before.

If you know your employees work a lot of extra hours, you do, legally, have the option of lowering their hourly wages (as long as it’s above minimum wage) so that the combined overtime pay adds up to a comparable annual salary. However, this will mean your employees will take home smaller checks than before, which Lucas warns could be quite “demoralizing.” After all, the point of the rule change is to make sure that more employees get fairly compensated for all hard work they do above and beyond the minimum.

Lucas also points out that these are changes in the federal law, which sets a nationwide minimum. However, some states, such as California, already have a higher salary rate for exemption; if this is the case in your state, your payroll may not be affected. She also helpfully notes that since January 1 falls on a Wednesday, which is likely mid-pay cycle, it might be less confusing if you implement any changes in wages the week before.

Ellen Vessels, a Staff Writer at The American Genius, is respected for their wide range of work, with a focus on generational marketing and business trends. Ellen is also a performance artist when not writing, and has a passion for sustainability, social justice, and the arts.

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Business Finance

Under-representation of women in fintech: Let’s talk about it

(BUSINESS FINANCE) Representation of women in fintech remains scarce despite a prevalent population of interest. Why is this the case, and what can we do about it?

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Woman reading a document in front of her computer, one of the women in fintech.

Women are 50% of the population – so why are there only 9 of us on the 2020 Forbes Fintech 50?

I’m personally shocked by how underrepresented women are in such a lucrative industry. By 2022, it’s predicted that fintech, or financial tech, will be worth $26.5 trillion, and we cannot afford to miss out.

And I’m serious when I say fintech is truly taking over. This includes payment processing, online and mobile banking, person-to-person payments (think Venmo or Cash App), financial software, to name a few. For some perspective, half of consumers use digital banking services as the primary way to manage their money. That’s a big deal.

So why does it matter that women are drastically underrepresented in leading roles at these companies?

  • Women CEOs receive only 2.7% of all VC funding – that is astonishingly low, considering that the remaining 97.3% is secured by their male counterparts.
  • While a study conducted by the Harvard Business Review on leadership skills found that women scored higher than men in 17 out of 19 categories (I could’ve told you that), women founders make up only 17% of fintech companies. Some of the categories tested on were:
    • Bold leadership
    • Taking initiative
    • Resilience
    • High integrity & honesty
    • Collaboration and teamwork (this is a big one!)
    • Inspiring & motivating others

If you’re a woman interested in business, tech, or entrepreneurship looking to break into the big leagues, here’s some exclusive advice from lady CEOs, founders, and COOs:

  • Stay Passionate
    Suneera Madhani, Founder + CEO of Fattmerchant, says: “…remember why you started and hold that close to your heart when times get tough.”
  • Be Open to Learning
    “Never behave as the smartest person in the room because you may miss some of the best ideas.” Says Snejina, Co-founder + CEO of Insurify.
  • Trust Your Intuition
    As the Founder + CEO of Tala, Shivani Siroya urges us to: “Stay excited, focused on results and be incredibly optimist. It’s okay to really believe in your gut – just make sure that you see the results with it.”

2021 is a new year full of opportunity – even though the odds are (and always have been) stacked against us, let’s have this be the year where women techies and business owners capitalize on their leadership skills. We have lost time – and profit – to account for.

Author’s Note: Thank you to CreditRepair for the linked infographic!

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Business Finance

TikTok users are making bank by copying Congress peoples’ investments

(FINANCE) TikTok, the short-form video platform, has users trading stocks tips. The newest strategy: following Congress peoples’ stock moves.

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TikTok isn’t just for funny dances, crude jokes, and kids born after the year 2000 (but crazy to think, they aren’t kids anymore, they could be 21…time flies). The short-form video platform that soared to be the #1 most downloaded app during the pandemic is giving tips to youngsters and millennials for their finances. The newest strategy: following and copying Congress’ stock moves.

This is in part to the not-so-surprising news of insider trading among politicians and the ability to duplicate trades of another user on platforms such as Iris, whose website says…

“Invest together with your family, friends, and brilliant people all over the world. Get real-time notifications when others make trades and copy their moves.”

Nancy Pelosi and her husband, Paul, are the prime examples of government traders (or traitors, you decide) to watch. For example, Paul made $5.3 million through call options to buy 4,000 shares of Alphabet before the House Judiciary Committee voted on antitrust regulations. He also exercised $1.95 million worth of Microsoft stock just 2 weeks prior to the company’s awarded contract worth $22 billion for the use of their VR headsets in military training. Lastly, before President Joe Biden announced another incentive program for EV manufacturers, he also paid Tesla stock options for $1 million.

Nancy Pelosi at the podium.

Christopher Johns, the cofounder of Iris, said that every trade “inevitably turned out to be such a long-term winner.” Wonder how that’s possible (eye roll). He adds, “if they’re the ones passing the laws, it’s probably smart to keep up and see what they’re buying.”

And yes, their stock picks are considered public trading activity and this is perfectly legal. Trading is no longer a lone man in a dark room behind 3 large computer screens of graphs or Jim Cramer screaming in the background- it’s a full-on social activity, just like everything else nowadays.

There is a whole community behind these meme cryptos, penny stocks, and short squeezes. You’ll find them on r/wallstreetbets, Elon Musk’s Twitter, Facebook groups, and of course, trading TikTok, all contributing to the “Eat the Rich” scheme of Gamestop/AMC, the elaborate rise and fall of Dogecoin, and the now trending, 2nd dog-specific coin, Shiba Inu.

Laugh all you want, but these kids are working smarter, not harder, and even outsmarting the best in the league, by following the best in the league.

AMC, Gamestop, and Dogecoin.

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Business Finance

Mastercard partners with Bakkt to offer crypto services to its vast network

(FINANCE) The thousands of banks and millions of merchants on the Mastercard network could soon integrate cryptocurrency in their products and purchases

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Man holding Mastercard

Mastercard has announced a partnership set to change the financial industry forever.

The major payments network is teaming up with Bakkt, a crypto-focused firm spun off of Intercontinental Exchange, that would be the provider of custodial services for users that sign up. This means that the thousands of banks and millions of merchants on Mastercard’s network could soon integrate cryptocurrency in their products and purchases. Bitcoin wallets, cards that earn rewards in crypto, and loyalty programs like airline travel or hotel points that convert to bitcoin would be included. The benefit is that the rewards or points in the form of crypto will allow users to earn a yield. Bakkt CEO Gavin Michael said in an interview,

“It’s an easy way to get going because you’re not using cash, you’re putting something that’s an idle asset sitting on your balance sheet, and we’re allowing you to put it to work.”

cryptocurrency

With Mastercard being a dominant force in the global payments industry alongside Visa, and 2.8 billion Mastercards in use, the announcement could bring a noteworthy expansion to how Americans interact with bitcoin and other cryptocurrencies. Sherri Haymond, the executive vice president of digital partnerships says,

“Our partners, be they banks, fintechs, or merchants, can offer their customer the ability to buy, sell, and hold cryptocurrency through an integration with the Bakkt platform.”

The development of crypto, and bitcoin in particular, has dramatically increased in just the last year. Bitcoin has reached the record price of $60k this month and U.S. regulators have now allowed bitcoin-linked ETFs.

In a U.S. Consumer Crypto survey by Bakkt consisting of 2,000 consumers, 48% said that they purchased some form of crypto in the first half of 2021. 32% that had not yet purchased crypto reported that they were heavily interested in purchasing by EOY.

According to the Mastercard New Payments Index, 77% of millennials stated their interest in learning more about crypto while 75% said that they would put it to use if they could understand it better.

“We want to offer all of our partners the ability to more easily add crypto services to whatever it is they’re doing.”

Cryptocurrency on top of US dollar.

And just announced, due to the popularity and interest in cryptocurrencies in the Asia Pacific, consumers and businesses there will have the ability to apply for crypto-linked Mastercard credit, debit, or prepaid cards allowing them to convert their crypto into traditional currency to use globally. Mastercard is partnering with Amber Group, Bitkub in Thailand, and CoinJar in Australia to offer this service. Be on the lookout for the rollout of these services in the States soon!

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