Education

Does your business or employer have California payroll?  If so, you might want to brush up on the new law that has several law firms reporting a California Division of Labor Standards Enforcement crack down on out-of-state companies with multiple retail establishments.  Investigators are now checking to make sure pay statements and payroll records are kept onsite or at a central location elsewhere in the state.  Failure to comply will bring costly penalties assessed per employee per violation.

The law states that employers must keep a copy of an employee’s pay statement for at least three years either at the place of employment or at a central location within California (Cal. Lab. Code Sec. 226).  Fail to keep the appropriate and correct records and a civil penalty of $250 per employee per violation for an initial citation can be assessed.  Those who play “record roulette” and roll the dice to see if they will be audited again will find a $1,000 per employee for each violation for subsequent infractions.

So what should you do?  Any retail establishment that has a location within California should conduct periodic audits of their pay statement and payroll record retention practices to make sure they are in compliance.  Employers can also meet the requirement by having electronic records that can produce hard copies of payroll information.

Recently I happened to read an article about a new company.  They are a T-shirt company and I thought that's just what we need is another T-shirt company.  However, more reading proved that the company really is unique.  The name of the company is "Threadless" and their motto is simple:  "The customer is the Company".  I couldn't agree with this more.

Threadless turns out dozens of new items each month, without advertising, professional designers, sales force or retail distribution.  Yet it's never produced a flop.  Threadless started by running competitions on an online social network.  Members of the network submitted their ideas for T-shirts and then voted on which ones they liked best.  Tons of shirts were sold for $15 each.  Revenue was growing 500 percent a year, despite the fact they had no marketing or advertising plan, used no modeling agency or fashion photographers, or had no sales force.  As a result, costs were low and margins were above 30 percent.

This new innovation business "model" is reshaping many industries.  And this idea goes against a basic principle that has been taught in business schools since the invention of mass production:  Employees make stuff, and customers buy it.  But this archaic "model" isn't making it in a marketplace of ever-narrowing niches and nearly unlimited consumer choices. 

Regardless of the business, customers must have a larger say in what is produced that they will buy.  We've seen customer service becoming a "thing of the past".  Companies must rethink the products they sell if they are to survive.  This goes for every product, including education.  Providing accounting and bookkeeping education that will help people find jobs or advance is the primary aim of Gateway to Learning.  And this has taken quite a few years to put into practice.  We think we've finally got it right and hope you, our customers, think so too.