Don’t Be a Victim of This Yellow Pages Scam

You receive a fax from what you think is the Yellow Pages. The fax includes the “walking fingers” logo we’re all familiar with. The fax asks you to update your information for your local Yellow Pages listing. What would you do?

If you’re like the thousands of business owners in the U.S., Canada, and Australia who did receive this fax and didn’t read the fine print, you’d probably fill in your contact information and send the form back without a second thought.  Unfortunately, what the fine print revealed is that by returning the form, these business owners agreed to pay $89 a month for a two-year listing on a non-Yellow Pages online business directory.

This scam is alleged to have been perpetrated by a company based in Europe called Yellow Pages Marketing B.V., which collected millions of dollars in fees from U.S. small business owners alone. The company is now the target of a lawsuit filed by the Federal Trade Commission (FTC).

We’ve all heard this before, but it bears repeating: Always read the fine print.

For more on this scam, see The Wall Street Journal’s In Charge blog.

Why You Should Encourage Employees to Take Vacations

Businesses offer vacation time to their employees for a number of reasons. It boosts morale. Employees return to work with recharged mental batteries. And generous vacation policies attract new employees. Can it also uncover fraud?

Two of The Wall Street Journal’s blogs, In Charge and The Juggle, describe novel vacation policies at two different companies. One company pulls an employee’s name out of a hat each month; that employee is required to take two weeks off the following month. (Some workaholic employees don’t want their names to be chosen, if you can believe it.) Another offers employees who take off two consecutive weeks another two weeks of vacation time.

Why force employees to take time off? These companies say workers need time off to recharge. Employees are also forced to keep their co-workers in the loop on their projects, so no one employee is indispensable.

And, it seems, requiring employees to take time off helps uncover fraud, if there is any. Comments from readers note that employees involved in any ongoing fraud, like embezzlement, hate going on vacation. Fraudulent activity requires constant attention to prevent discovery, and forcing employees to take time off will usually bring the fraud to light.

IRS Issues Warning About Tax Scams

The IRS issued a warning to taxpayers this week about a recent increase in tax return scams where taxpayers are told to file their claim asking for tax credits, refunds, or rebates which they are not entitled to take. Many cases involve unsuspecting taxpayers who don’t have any obligation to file a tax return at all. These people are deceived into filing fraudulent claims by unscrupulous or dishonest tax return preparers who often charge unreasonable fees for advice on how to file the false claims.

The IRS advises taxpayers to watch out for the following:

  • Fictitious claims for refunds or rebates based on excess or withheld Social Security benefits.
  • Claims that Treasury Form 1080 can be used to transfer funds from the Social Security Administration to the IRS enabling a payout from the IRS.
  • Unfamiliar for-profit tax services teaming up with local churches.
  • Home-made flyers and brochures implying credits or refunds are available without proof of eligibility.
  • Offers of free money with no documentation required.
  • Promises of refunds for “Low Income – No Documents Tax Returns.”
  • Claims for the expired Economic Recovery Credit Program or Recovery Rebate Credit.
  • Advice on claiming the Earned Income Tax Credit based on exaggerated reports of self-employment income.

For more information, visit the IRS website at www.IRS.gov, call the IRS toll-free number at 800-829-1040, or visit a local IRS Taxpayer Assistance Center. For questions about rebates, credit, and benefits from a federal agency, contact the relevant agency directly.

 

Seeking Small Business Innovators

In the hopes of spotlighting American ingenuity, The Wall Street Journal is inviting small businesses to apply for its Small Business, Big Innovation competition. The paper is looking for small business owners who revolutionized their business models to prosper during the current economic recession. The deadline to enter is September 5, 2011. More information can be found on The Wall Street Journal’s website.

Vacations and Exercise: Keys to Success?

What does it take to build a successful small business? If we knew, we’d all be millionaires, but two things to add to the mix may be surprising to you: time off and exercise.

Taking time off when starting up a business may be counter-intuitive, but according to an article in the Wall Street Journal (“Time Off Is No Option: It’s Required,” by Sarah E. Needleman), time off is essential to avoid burnout and jumpstart creativity. One entrepreneur interviewed for the article describes how, in the day-to-day grind of building his business, he feels like he’s “constantly looking at trees and never seeing the forest.” (Sound familiar?) Vacations offer him a “mile-high perspective” over his business that he can’t get when his head is buried in his laptop.

Can’t afford to take off a week? Go away for a three-day weekend. Or tack on a day or two after a business trip to see sights and visit friends. It might also help to think of vacations as networking opportunities. And remember, with a smartphone or laptop and a wireless connection, you can easily keep tabs on your business while away.

Exercise is the cure-all for many ills: it helps you lose weight, prevents disease, and aids in getting a good night’s sleep. And, according to blogger Derek Flanzraich, it can also help your small business succeed. How? By boosting your energy level, sharpening your focus, and helping you come up with better ideas—all things an entrepreneur needs and could use more of. (Need help on starting up an exercise regimen? Derek’s got you covered. Read the comments for some interesting real-life tips from readers.)

 

Businesses Must Take Steps to Prevent Workplace Harassment by Non-employees

A business may be found liable for workplace harassment committed by outsiders, according to a recent decision of the U.S. Fourth Circuit Court of Appeals. In that case, EEOC v. Cromer Food Services, Inc., 2011 WL 733814 (2011), the court held that an employee could sue his employer for failing to prevent harassment he encountered on his sales route.

The Cromer case involved a lawsuit by a delivery driver whose job involved restocking snack and beverage machines owned by his employer but located in various businesses and other facilities. The driver’s route included a local hospital, the employer’s biggest client.

The driver alleged that over a period of several months, two hospital employees harassed him whenever he restocked the hospital’s vending machines. The driver asked his employer to change his route or intervene with the hospital to put an end to the situation, but the employer took no action.

After the driver sued, his employer argued that it could not be liable because it was not responsible for preventing harassment by non-employees, such as the two employees of the hospital. In a broad decision consistent with prior decisions in the 7th, 9th, 10th, and 11th Circuits, the court held that employers covered by Title VII of the Civil Rights Act of 1964 can be liable for on-the-job harassment committed by non-employees, if the employer had actual or constructive knowledge of the situation but failed to take action to protect its employee from the harassment. The court allowed the driver’s suit against his employer to proceed.

No small business wants to hear that its employees are being harassed, whether by other employees or outsiders. But Cromer confirms that if your small business learns that an employee is being harassed on the job by a customer or other outsider, taking action to prevent the harassment may not just be the right thing to do from a moral and ethical perspective but a legal requirement.

By: Guest blogger Steven Koprince, an attorney with Petefish, Immel, Heeb & Hird, LLP in Lawrence, KS. Mr. Koprince’s practice emphasizes government contracts and small business law.

IRS Increases Standard Mileage Rate for Last Six Months of 2011

The IRS has increased the standard mileage rate to 55.5 cents per mile for business miles driven from July 1, 2011, through December 31, 2011. The standard mileage rate is an optional rate that taxpayers can use to calculate their deduction for the cost of using an automobile for business purposes instead of tracking their actual costs. Small businesses also use this rate when reimbursing employees for business travel.

The IRS usually sets the standard mileage rate annually but decided to make this special adjustment for the second half of 2011 because of the recent increases in gasoline prices. The rate is 4.5 cents higher than the 51 cent rate that was in effect for the first six months of 2011. For more information, go to the IRS website at www.irs.gov.

Employees, Social Media, and Your Small Business

Can you legally fire one of your employees for a Facebook post critical of your small business? No, according to the National Labor Relations Board (NLRB), which issued a complaint in late May against an Illinois BMW dealership, alleging that the dealership unlawfully terminated an employee for making critical comments about the dealership on Facebook.

The NLRB’s complaint alleges that a car salesman posted complaints about the quality of food and drink served at a dealership event promoting a new car. Other dealership employees had access to the salesman’s Facebook page. The following week, management asked the salesman to remove the posts, and the salesman complied. However, soon after, the dealership fired the salesman.

According to the NLRB, the employee’s Facebook posts were protected “concerted activity” under the National Labor Relations Act (NLRA), because they were part of a discussion among employees about the terms and conditions of their employment. An NLRB administrative law judge was scheduled to hear the case on June 21.

The BMW dealership case comes on the heels of other NLRB complaints against employers for penalizing employees based on critical Facebook comments, blog posts, or other social networking activity. For instance, in February, a Connecticut employer settled a NLRB complaint alleging that the company fired an employee for posting a negative comment about her supervisor on Facebook. And in April, the NLRB filed a complaint alleging that a media company violated federal law by restricting its employees’ ability to use Twitter to discuss working conditions with coworkers.

The NLRB’s actions do not mean that every social media post an employee makes is protected by law. In fact, the NLRB recently held that a Tuscon-area newspaper did not violate the law when it fired an employee for unprofessional and inappropriate tweets that included remarks about how Tuscon was “slacking” because there were no overnight homicides and sexual innuendo to describe the employee’s television viewing habits.

While unprofessional and inappropriate conduct may not be protected, the intersection of social media and the NLRA is an evolving area of the law, and it is not yet clear when a Facebook post or tweet crosses the line from protected concerted activity to punishable offense. If your small business is concerned about the social media activities of one of your employees, proceed with caution, because the employee’s actions may be protected by the NLRA.

By: Guest blogger Steven Koprince, an attorney with Petefish, Immel, Heeb & Hird, LLP in Lawrence, KS. Mr. Koprince’s practice emphasizes government contracts and small business law.

Don’t Greenwash When Marketing Your Business

Have a product that you’re thinking about marketing as “green” or “eco-friendly”? You may want to tweak your marketing plans.

Responding to the rampant and unregulated marketing of products as Earth-friendly, the Federal Trade Commission (FTC) is set to update its Guides for the Use of Environmental Marketing Claims (also known as the Green Guides) later this year. One of the proposed changes is a bar on the use of unqualified claims of environmental benefit, such as “sustainable” or “Earth-friendly.” Other proposed changes include limitations on the use of green certifications or seals of approval, claims that the product was created with renewable energy or renewable materials, and terms such as “biodegradable,” “compostable,” “recyclable,” “non-toxic,” or “ozone-safe.” Violators of these guidelines may find themselves taken to court by the FTC.

What to do if you truly believe your product is green and want to shout it from the rooftops? Comply with the FTC’s guidelines. Make sure all of your claims are verifiable. And seek third-party certification from a company like Green Seal.

If you’re a consumer trying to wade through the sea of green labels on store shelves, check out GreenerChoices.org, run by the publishers of Consumer Reports.

Business in the Cloud

The talk of clouds in business is everywhere–mostly recently with the unveiling of iClouds for iTunes music storage. What is it? Simply put, with cloud computing, you pay to access an Internet-based service which hosts the software, hardware, and other resources you need to run your business. This eliminates the need for you to run software or other applications on your own computers; the cloud network handles everything. You use your own computers simply to access the system, and all your files and information are stored and managed and accessible through the cloud network.

The President and CEO of The Small Business Authority, Barry Sloane predicts that cloud computing will be the next big trend in the business community. “There is no doubt that business owners will embrace the cloud concept and over time gravitate towards its massive benefits. . . . Business owners will need to understand what the cloud is and what it can do for their businesses in the areas of cost control, data security, data protection, accessibility, efficiency and productivity to facilitate a smooth running technological platform for their business.”

There is certainly a lot of cost savings and work efficiency potential for small businesses with cloud computing. Users would have access to their files anytime and from anywhere, and it features shared usability. It is also designed to be scalable so that businesses can purchase only what they need, at the scale they need, and then the services can grow as the business and its needs grow. Fees for these services are usually charged on a month-to-month or annual basis.