Home Forums Discussions General Discussion Ethics versus it is my money

OK, these things always happen to me. As far as the ethical side, I could do nothing and sleep well. On the other hand, I could do nothing and sleep well. I would love advice from anyone on the board.

All the staff have been told verbally and in writing that the computers are the property of the office and anything that is put on the computer or downloaded is the property of the office and can be viewed at any time. They have also been told that they can use Outlook of O365 for business purposes only and may not, at any time, use web mail such as Gmail or Yahoo, etc. This is due to company email is more secure and all email needs to be archived for numerous purposes including HIPAA.

I have told them that from time to time I will send emails to them for communication purposes or policies that will be documented in the office manual.

There are times when an email I sent to everyone contains information that may not be suitable for one or more staff members to read. This rarely occurs.

A few days ago, I sent an email to the staff, after which I reconsidered and felt it would cause problems with employee morale, and it would be better talked about in an email. I then deleted the emails from each person's inbox. OK, so there is the ethical issue.

For reasons which are beyond me, the staff love to set up their emails so that it shows two lines of the email and there is a reading pane to the right. In going into one email account to delete the errant email, I couldn't help but see an email thread where one of my employees was asking for advanced bonus money. The questions specifically asked if the employee could receive her bonus for this month early as well as next month's and then she would forego next month's bonus. I give bonuses to each employee at Christmas, but it is a one-time thing, and I decide the amount based on performance.

I wasn't sure how to handle this, but since it was approved by my practice consultant, I asked her what the payment arrangements were for this particular employee. She stated hourly pay, overtime, vacation time, stipends and bonuses. The first four I knew. I was not aware of any bonuses. So, I sent an email back to her stating this and asked if she could give more information about the bonuses. She told me it was the Christmas bonus. Which was odd. I, of course, couldn't bring up the email conversation I had seen.

It then occurred that Payroll emailed and informed the employee that she had received all of the hours for the week, but she had received a standalone email from my consultant advising payroll to send a NET check for $1,000. She asked the employee was this over and above her normal pay. The employee stated that is correct. (OK, again, ethically I probably shouldn't have read this, but at this point when PayChex and my accounting firm and my practice consultant (business manager -- not in house office manager) and my staff member, all of whom I pay, were talking about bonuses that my payroll company clearly seemed to question, I felt entitled. Why is she receiving bonuses? Who is making these decisions? Why am I not aware? Is this a one-time bonus or is she receiving them all the time? I blame myself for not paying more attention to how my employees get paid, but as an aside -- even though I know what the stipend is for -- I would rather this employee to have her hourly wage and stipend rolled into one hourly amount, while overtime and vacation time would apply as it does for everyone. The annual bonus would be given per usual by me.

OK, so taking the ethical part first, was I wrong to even go there even when I saw this inadvertently? But, let's forget that for a minute and ask what people would do given this information. Keeping in mind that my practice consultant blatantly lied about the bonus.

1. I suppose I could confront the employee and ask the same question. What is her pay structure? If she brings up the bonuses, it makes it easy for me to ask what they are for.
2. Should I ask my practice consultant (this is someone who contracts to do all the business things, is very good at what she does -- and in some ways considers herself my equal).
3. Should I contact PayChex, letting them know I am the owner, pay everyone including them, and I would like to know how many of these bonuses have been given.
4. Should I contact my accounting firm?
5. Should I bite the bullet and just email everyone, not bring up the subject, but state that given that one day my consultant will retire and I think it is in my best interest to know more about the ins and outs of the financial side of the business. And, therefore, I would like to be copied on all emails to and from PayChex and accounting and to be given a statement of employee payment and salaries?
6. Should I contact my practice attorney who deals only with me and ask for advice.

The bottom line is while I may have and others may agree that I have come across this information in possibly an unethical way, how do I just let it go and not worry about it continuing? I suppose an analogy would be if the same happened, and I was reading an ongoing system of an employee and business manager taking money off the books. But, PayChex is clearly not involved in this, and everything they do goes to my CPA.

Any advice would be appreciated.

Thanks.

The information would've possibly been discovered on a bank statement for an unknown debit. Natural response would be to ask the payroll people or the practice manager. As the owner of the business, you have every right to know how funds are being allocated.

Putting the ethical dilemma aside, I would say a combo of 2,3, and 4. Employer dictates the pay structure so going to the employee or attorney isn't the best idea for that information. That's usually outlined in an employment agreement/handbook.

It sounds like you believe they are discretionary bonuses but the practice manager thinks they are earned bonuses (based on hours worked or something similar). It all depends on what's in your employment agreement/handbook.

First thing to find out is how much has been paid in bonuses either from the accountant or the payroll company. If you find that money is being embezzled out of the business, then it's time to get the attorney involved.

Think the practice manager should be supplying you with monthly reports on payroll, bonuses, etc. Would think all payroll policies have to go through you unless you signed over all the business side of the business to the practice consultant. get the data paychex can easily compile reports. I don't know but something making my remainig hair stand up a bit.

I would start with #2, the practice consultant. The employee is somewhat out of the loop. She asked for and received her bonus early. From her standpoint all was good. The payroll company did what they were told - pay the employee.

The question is what was the basis of the bonus and how did it become ingrained (i.e was a Christmas bonus made automatically into the pay structure without your knowledge). But you make mention of a monthly bonus - how is that determined and was this the monthly or the Christmas bonus. But you also state that you did not know about bonuses, I'm somewhat confused on this.

It appears you were inappropriately taken out of the loop. It appears to be through the practice consultant. On the surface there probably isn't any malfeasance. If the explanations of why you were not included are not clear enough from the the consultant, it might be worth having the accountant look for any other unexpected cash flows. (Then again, might be reasonable doing that anyway, just to make sure).

Thanks for all of the replies. Sorry it was so confusing. All of the employees get an end of the year bonus which is around Christmas based on their job performance. These bonuses are determined by me. Everyone gets paid for the same reasons:

Hourly wage including overtime
Vacation pay
Paid holidays
One annual bonus at the end of the year

My biller gets the same except she gets what is termed a stipend. My practice consultant, without whom I never would have been able to start the business, is paid a separate salary. My practice consultant moved out of town and does everything by phone, email and text and is still just as good as she was when she was here. She does everything and interacts with accounting and my bank and Payroll. She decides when bills should be paid. I can be included on the bill payment and almost all bills are paid by check, which I have to sign, and the bank knows that. There are a few automatic withdrawals. My practice consultant has done this for over 35 years and has done the same with a total of over 50 practices with never a complaint. Anyway, there was a one part of her job that she gave over to my biller as it is more hands on. What I used to pay for that, I pay my biller. So, that is considered the stipend. The stipend is the only thing that she gets that the others don't get.

When I first discovered this, here was my thinking. My biller asked my practice consultant if she could get her bonus a little early as well as next months' bonus. And, then she would not get the following months' bonus. This is all due to her not being able to pay her mortgage. The fact that she said can I get my bonus plus next months' early led me to two conclusions. One, she is getting a bonus I am not aware of and that they seem to be monthly. Then, I thought maybe she was referring to her stipend as a bonus, but that didn't make a lot of sense just due to the definition of the term bonus. But, I asked my consultant what my biller made including the above as well as her Christmas bonus. I asked if she received any other reimbursement. I felt that wasn't too direct.

Her reply was she made the above (what the others make and how) as well as the stipend and bonuses. She then stated she barely made enough to makes ends meet and that this year she should make $7,000 more. The only increase that I know of would be her 50 cent raise. But, she did state that she gets bonuses. I guess the issue is that I don't know what these bonuses are and what they are based on. She thought I was asking because I may have wanted to give her an extra bonus.

The weird thing is payroll specifically asked my biller if the $1,000 bonus would be over and above her usual pay as if they knew nothing about it. It would also imply that her monthly bonus is $500. Which would mean $6,000 net income that I am not aware of.

While I wouldn't necessarily agree with her making a certain percentage of the charges or receivables, I could sort of understand that. But, these would fluctuate.

One thing I didn't think of is when I asked what she made and how she made it, which is a perfectly legitimate question, the PC did mention "her bonuses." So, I suppose it would be easy to say to my PC, "Thank you. That is what I thought. Except I don't know what the bonuses are for." This would mean I have a legitimate reasons to ask her other than to say, I saw this in her emails.

Unless my PC thought she was "found out" whether ethically or not," the fact that she freely stated she was paid bonuses lends credence to the fact that they are legit. Maybe not something I would approve of but nothing fishy.

My other question seems straightforward:

1. My PC has dealt directly with the bank, PayChex, accounting, employee pay and bills for 14 years. All of these entities would feel that she is the go to person and has permission to ask them anything or be in the loop, but....
2. I pay the bank, PayChex, accounting, employees and the bills.

So, should I be able to talk to accounting or PayChex and make it clear it is confidential?

This may sound cold, but I couldn't care less that she can barely make ends meet. She accepted the job and accepted her pay and gets her raises, etc. All of my employees can barely make ends meet. I mean if someone came to me and needed a small amount for something extremely important, I would front them some amount or float them a small loan which would be paid out of their weekly pay.

What is the basis of the year end bonus, is it fixed, or tied to productivity or such.

If fixed, I would expect all employees would share equally including non clinical employees, so I would expect she would get a year end bonus. Yes, she asked for it early, probably cleaner than floating a loan.

If based on productivity it could be argued that being more productive gives her more work but her bonus would have more tenuous status. But the fact is she HAS been getting them and sort of expects them. The fact that she asked for it early could be understood other than the amount is thus variable so what was it based on.

I suspect there was a mix up on the term stipend and bonus. She gets a monthly stipend which she was calling a bonus for advance. This again may be easier to advance rather than giving her a loan, but needs to be followed.

Stuff comes up. There are creative ways of supporting your employees who I think we will all agree do not make a lot of money. Loans, vs vacation advances vs advance bonus or stipend are all legitimate but you should be aware of what's going on. It may be reasonable to review the entire structure with your PC and set guidelines that you thought were understood just to be on the same page. It might also be reasonable to have the accountant make sure that there were no unexpected transfers that neither you nor the PC were aware of because they may only be looking to make sure the books balance.

Ultimately it sounds like it may have been an acceptable advance but you were not notified. But it also made you more aware of what you don't know and probably should have been aware.

It is not fixed, and it is nowhere near $1,000. It is based on the employee's work performance. They almost always get a minimum of $400 and performance adds more. But, it is a one-time bonus, not monthly. And, certainly not something you would say I need $500 of my Christmas bonus and an early $500 on next years' Christmas, lol. Plus, this is an actual statement from the PC:

"Last year she made $ 31,997 for the year with all income , monthly stipend and bonuses." This clearly shows that the stipend is not the same as bonuses. And, the word "bonuses" means more than one. I really feel I have two choices.

One is to simply ask my PC what the bonuses are for. That I have forgotten. Second, would be to ask accounting. They would have to know unless it is under the table. Because even a bonus that is net has to have a higher amount that taxes are paid on. It would be like a draw. But, every penny must be accounted for, and the CPA would have to have the bonus listed on their ledgers. They have to know it was paid, and it was not profit. They may not know what it was for, but they would know where it went. The fact that my PC lists it in the open in her email to me, makes it seem legit. But, if she read between the lines and figured out why I was asking the question, she would be better off doing that and then coming up with a reason. What makes no sense is a bonus that is the same each month. You may as well tie it into the stipend or increase her pay.

Just as an FYI, we have never loaned anyone anything. We used to have this system where each hour you worked you earned time off, but the only ones who understood it was my PC and I. And, man, do they abuse that.

There are 2 issues. One is that you don't know what's going on. The second is that it is history and something for you to learn from. The money has been dispersed. If you don't think it should be dispersed in the future then you need to change the rules. If you and your PC come to an understanding then all is well. You can't punish the employee because everyone but you thought it was above board. You could punish the PC, but again she thought it was above board so there is a miscommunication, so would that even be fair.

You should discus it first with the PC and then possibly with all the employees as to what the rules are about loans, advancements, bonuses and such. Once everyone is on the same page, you hopefully will no have any further questions.

Related question: My employees are pushing to consider group health insurance rather than bonuses. (Yes I know it's cheaper to give a bonus... but) . I haven't talked to my insurance folks yet, but any great ideas before I do?

Thanks. It's not that complicated actually. Just saw her asking for her "bonus" early. That would be wrong and I would have gone to my accountant if my PC was giving out bonuses on her own. I think when I emailed the PC every which way to find out what the deal was she was trying to say:

Stipends: The monthly payment to the biller for taking over the onsite PM.

Bonuses: Any and all bonuses that she may get. This is where the confusion lies. She only gets one bonus.The Christmas bonus.

Bonus: She kept stating she gets the Christmas bonus like everyone else.

The problem was she kept saying she received: 1) pay 2) monthly stipends 3) bonuses and 4) a Christmas bonus. Which was a pretty stupid way to say it.

The way I figured it out was, I asked my biller if she received a stipend (should just call it a monthly salary or payment) for doing the extra PM work. Since she had asked for her $500 up front and her next one early, it couldn't be a percentage, like a bonus derived from charges, etc. So.....I figured all I had to do was ask her how much does she get paid monthly for the extra work. If she said ANYTHING other than $500, there would be an issue. But, she said. $500. Meaning, she gets $500 a month extra for the PM. She doesn't get bonuses on top of that. I think my PM was drinking or something. Still giving it early without my consent was wrong, but not a huge deal.

Great idea: DO NOT!!!

Biggest mistake I ever made. Providing health insurance (Blue Cross/Blue Shield -- the best here). Also gave 401Ks, but another story.

Bonuses:

Advantages:

1. Always a positive thing. They love it. It helps with Christmas.
2. You can go up and down but they still are happy especially with good performance reviews and explanations. You could even delay it or skip it one year and you haven't COMMITTED to anything.
3. Bonuses aren't premiums. They don't go up or down. You aren't tied to the whim of the biggest rip off racket in American history.
4. You can make it VERY, VERY clear that they CANNOT share the amount with anyone or there will be consequences. I have not had an issue with this.
5, It actually is in your control to decide how much someone should get.

Disadvantages:

They are all excited and thankful, but they may not remember it all year....but not a big issue.

Insurance:

Advantages:

1. You will feel good about yourself. In discussions with parents just in general about the healthcare system, you can say, "Yes, I can't believe what I pay for employee insurance...." Now, I can say, "Wow, I can't believe what I used to pay my employees for their insurance...."
2. You know they have insurance.
3. I don't know about taxes and deductions.

Disadvantages:

1. Pretty much everything. Having to listen to an insurance sales rep lie to you and sell something to you that is almost worthless.
2. It is generally tied into if the employee has so many hours. So, they go to part time or go to full time....could change things and even others' insurance.
3. The premiums ONLY go up. Have you seen them go down?
4. Be prepared to spend one to two weeks and a two-meeting with an insurance rep going over the new plans you must buy every year. Only about 20 options.
5. Imagine giving a bonus and hearing monthly from your employees, "Damn, I bought too many gifts for Christmas because of those bonuses." They suck.....
Well, that is all you will hear about the insurance. Do you know how many times I heard thank you for paying for the vast majority of the staff's insurance was? Ready. Correct. Zero. All I heard was, "Insurance sucks. This insurance is horrible. I am paying $25.00 a week, and it didn't even cover my lab work. I still had to pay a $30.00 copay for my prescription." It is like so someone on Medicaid complaining they can't get Ambien until they fail Trazodone. They say, "Medicaid sucks." Ummm, right.
6. Your insurance will likely be tied into the same group.
7. Just like 401Ks, if you end up having to stop the insurance, the employees don't say, hey thanks for four years of good Anthem insurance. No, they will look at it like, "Damn, now he is taking away my benefits."

Even if you went low on a bonus with a good reason, in May you could give some. But, you can't just start and stop insurance.

There are only a few bills like insurance. Every time I signed the check, I would nearly throw up. I would be so pissed off.

Oh, and then get ready for the fun part. You decide it is too expensive. Like mine went from Grade A insurance at $1850 a month plus their contribution to Grade B at $2200 plus. I decided to stop. But, I am nice. So, I figured I couldn't just stop it in a month. So, I told them that I would do it one more year. Wrote it down in the manual and everything. Told them at least four times near the next year that we weren't renewing the insurance. They still acted like they didn't know.

With the 401K, this is what I heard from one employee:

So, now you are lowering my pay by ~ $5,000 a year.

God....no I matched you ~ $5,000 a year for three years. You got a free $15,000 you would not have received.

It would be decent if they appreciated it. But, it's human nature. When I get my EOB for $450 worth of lab tests, and the insurance pays nothing, I complain to anyone within 500 feet. So, do they.

Of course, when you increase their pay, you increase the match possibility in the 401K.