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Which bonuses affect overtime payment calculations (and which do not)? How are they affected?

Because overtime pay is based on an employee's "regular rate of pay" bonuses, incentives, and recognition payments must be carefully analyzed when calculated and paid with regards to the federal Fair Labor Standards Act (FLSA) and applicable state law. All bonuses are considered additional payments that employees receive over and above their ordinary regular earnings. However, bonuses are categorized two ways under the FLSA. In the first category are those bonuses treated as a "gift" from the employer. In this instance, the bonus is solely based on the employer's discretion. Bonuses falling into this category are accordingly "discretionary" may be ignored when figuring overtime pay required by the FLSA. Examples include the following:

  • End of the year (holiday) bonus
  • Gift bonus
  • Bonuses wholly within the employer's discretion
  • Profit-sharing bonuses paid pursuant to profit-sharing plans and trusts (as defined by 29 CFR SS 549)
  • Bonuses based on a percentage of an employee's total wages, both straight time and overtime.

Most bonus, incentive, and recognition plans, however, are "non-discretionary," and employers will have to reconfigure overtime payments as they relate to bonuses. Profit-sharing and bonuses based on a percentage of total income are the only common methods that employers may use to avoid the complicated recalculation. 

Some permissible factors for bonuses that still fall within the "gift" category, and thus do not trigger the calculation of overtime, include the following:

Bonuses paid with such regularity that the employees are led to expect it.

Bonuses that vary by employee on basis of salary, hourly rate, or length of service.

Gift bonuses may not be used to offset against overtime pay. Any overtime wages earned by employees must still be paid separately.

Bonuses Included in Overtime Pay Calculations

For many employers the calculation of overtime in relation to bonus payments that affect such payments can be handled by their payroll software service/vendor. However, if your software service/vendor cannot handle such calculations, the following rules and examples are provided to generally assist you in calculations. Most payroll services can double check your calculations for compliance. All employers should double check for any specific state-law requirements in these calculations (for example, California).

The following list give some, but not all, of the bonus types that must be included in overtime pay calculations for nonexempt employees: attendance, gain-sharing, on-call pay, commissions, production (both individual and group), quality, accuracy of work, efficiency, length-of-service, bonuses promised to employee at time of hire, number of overtime hours worked, etc.

There are two main ways to calculate wages with overtime and bonus figures. Examples are provided below and a MS Excel spreadsheet available for download can be found at under item 20, Legal Review.

What does "outsides sales" mean under the DOL overtime exempt regulation?

Section 13(a)(1) of the FLSA provides a minimum wage and overtime exemption for outside sales employees as defined in 29 C.F.R. Part 541. An outside sales employee is any employee whose primary duty is making sales within the meaning of section 3(k) of the FLSA and "is customarily and regularly engaged away from the employer's place or places of business in performing such primary duty." 29 C.F.R. SS 541.500(a)(2). Section 3(k) of the FLSA defines "sale" as "any sale, exchange, contract to sell, consignment for sale, . . . or other disposition." "Primary duty" is the "principal, main, major, or most important duty that the employee performs." 29 C.F.R. SS 541.700(a). The regulations further state that "work performed incidental to and in conjunction with the employee's own outside sales or solicitations, including . . . collections, shall be regarded as exempt outside sales work. Other work that furthers the employee's sales efforts also shall be regarded as exempt work including . . . attending sales conferences." 29 C.F.R. SS 541.500(b).

Under 29 C.F.R. SS 541.701, "[t]he phrase 'customarily and regularly' means a frequency that must be greater than occasional but which, of course, may be less than constant. Tasks or work performed 'customarily and regularly' includes work normally and recurrently performed every workweek; it does not include isolated or one-time tasks." The regulations further define "engaged away from the employer's place of business" for purposes of SS 541.500(a)(2) as:

[t]he outside sales employee is an employee who makes sales at the customer's place of business . . . . [A]ny fixed site, whether home or office, used by a salesperson as a headquarters . . . is considered one of the employer's places of business . . . . [A]n outside sales employee does not lose the exemption by displaying the employer's products at a trade show. If selling actually occurs, rather than just sales promotion, trade shows of short duration (i.e., one or two weeks) should not be considered as the employer's place of business.

29 C.F.R. SS 541.502. Also, under SS 541.500(c), "[t]he requirements of subpart G (salary requirements) of this part do not apply to the outside sales employees."

Are there OSHA requirements regarding wearing headphones (e.g., ipod) on the manufacturing floor?

Here is OSHA's position on them as they have two interpretations for the general industry, which includes printing, under the noise protection standard and under the General Duty Clause:

1. A 1987 OSHA interpretation letter ( states: "If Walkman[style] headsets are worn over otherwise effective ear protection, then the unit's volume control has to be adjusted to exceed the hearing protector's field attenuation. This obviates the effectiveness of the ear protection and is a violation of the noise standard 29 CFR 1910.95(i)(2)(i) or (ii).

Use of Walkmen in noise environments in excess of 29 CFR 1910.95, Tables G-16 and D-1 is a violation. Use of Walkmen over required ear protection is a violation. Use of Walkmen in occupational noise less than Tables G-16 or D-1 is at managerial discretion unless its use causes a serious safety hazard to warrant issuance of a general duty clause violation."

2. A 1985 interpretation letter ( states: "According to the Occupational Safety and Health Act of 1970, the employer is responsible for employee safety and health. Therefore, a number of employers have simply resorted to the outright banning of stereo headsets at worksites, since it is impractical to control individual volume settings for such devices."

Can the company establish a retirement age?

Generally, no. The 1986 amendments to the Age Discrimination in Employment Act removed the age 70 cap, mandatory retirement at any age was effectively prohibited. However, three exceptions were contained in the 1986 amendments: (1) bona fide executives and high policymakers with at least $44,000 of annual retirement income at age 65; (2) tenured employees and faculty at age 70; and (3) firefighters and law enforcement officers at the age specified by applicable state or local law.

The bona fide executive or high policymaker exception includes employees age 65 or older who have been employed in such a position for at least two years immediately prior to retirement, and who are entitled to an immediate nonforfeitable annual retirement income of at least $44,000.

The $44,000 amount is not indexed, so many middle-management employees easily will exceed that threshold. However, the Equal Employment Opportunity Commission's regulations make it clear that the exception does not apply to middle-management employees, no matter how great their retirement income, "but only to a very few top level employees who exercise substantial executive authority over a significant number of employees and a large volume of business."

Regulations first issued in 1988 (EEOC Reg. Sec. 1625.12) regarding the exception for bona fide executives reference Sec. 541.1 of the Fair Labor Standards Act that defines a bona fide executive as someone who:

* as a primary duty manages the enterprise or a department or subsidiary;

* customarily and regularly directs the work or two or more other employees;

* has the authority to hire and fire employees, or whose suggestions regarding hirings and firings are given particular weight;

* customarily and regularly exercises discretionary powers; and

* devotes 80% or more of his or her time to the above activities.

Sec. 4(f)(1) of the ADEA states that it is not unlawful for an employer to take any action otherwise prohibited by the ADEA where age is a bona fide occupational qualification (BFOQ) reasonably necessary to the normal operation of the particular business. Successful use of the BFOQ defense can result in a mandatory retirement system being allowed under the ADEA. Court cases interpreting the BFOQ exception have construed it very narrowly (e.g., airline pilots).  In Western Airlines v. Criswell, the Supreme Court said: "Unless an employer can establish a substantial basis for believing that all or nearly all employees above an age lack the qualifications required for the position, the age selected for mandatory retirement must be an age at which it is highly impractical for the employer to insure by individual testing that its employees will have the necessary qualifications for the job." (emphasis added)

The Court added that even in cases involving public safety, the ADEA does not permit complete deference to an employer's decision that retirement should be mandated at a particular age. The employer still must meet the two-pronged BFOQ test.

BFOQ Test:

(1) the qualification is reasonably necessary to the essence of the business; and

(2) age is a legitimate proxy for the qualification because--

     (a) there is a substantial basis for believing that all or nearly all employees older than that age lack the qualification; or (b) it is impossible or highly impractical to ensure by individual testing that each employee has the qualification at issue.

If the company gives employees clothes or accessories with the company logo on it, is it a taxable benefit?

Until recently, the IRS has taken the position that if employees received work-related articles of clothing and accessories, most with the taxpayer's logo, including tee shirts, polo shirts, sweaters, jackets, swimsuits, fanny packs, etc., which they were required to wear while performing services, that these were excluded from gross income as a de minimis fringe benefit. Now, under a new interpretation letter (September 2011) the IRS says that it can "no longer conclude, 'on a categorical basis, that the items were de minimis fringe benefits.'" The IRS letter does not provide clear guidance on if and when these are items taxable to employees; however, a high frequency appears to be a negative factor. The IRS also says their ruling will not be applied retroactively.

Are there OSHA requirements regarding first aid kits and supplies?

In general, the federal OSHA standard on medical and first aid issues (1910.151) allows companies to provide first aid supplies according to the specific needs of the workplace. In order to determine the appropriate supplies the company should perform an assessment of hazards, employee exposures, risk levels, liability issues, and of course the availability and capabilities of outside emergency services.

Appendix A of this OSHA standard is non-mandatory guidance that companies can reference and use to establish the appropriate first aid supplies. See below:

Appendix A
First aid supplies are required to be readily available under paragraph SS 1910.151(b). An example of the minimal contents of a generic first aid kit is described in American National Standard (ANSI) Z308.1-1998 "Minimum Requirements for Workplace First-aid Kits." The contents of the kit listed in the ANSI standard should be adequate for small worksites. When larger operations or multiple operations are being conducted at the same location, employers should determine the need for additional first aid kits at the worksite, additional types of first aid equipment and supplies and additional quantities and types of supplies and equipment in the first aid kits.

In a similar fashion, employers who have unique or changing first-aid needs in their workplace may need to enhance their first-aid kits. The employer can use the OSHA 200 log, OSHA 101's or other reports to identify these unique problems. Consultation from the local fire/rescue department, appropriate medical professional, or local emergency room may be helpful to employers in these circumstances. By assessing the specific needs of their workplace, employers can ensure that reasonably anticipated supplies are available. Employers should assess the specific needs of their worksite periodically and augment the first aid kit appropriately.

If it is reasonably anticipated that employees will be exposed to blood or other potentially infectious materials while using first aid supplies, employers are required to provide appropriate personal protective equipment (PPE) in compliance with the provisions of the Occupational Exposure to Blood borne Pathogens standard, SS 1910.1030(d)(3) (56 FR 64175). This standard lists appropriate PPE for this type of exposure, such as gloves, gowns, face shields, masks, and eye protection.

Clarification: In regards to what should not be in a first aid kit, employers should avoid any over the counter drugs like aspirin, pain relievers, cold medicines, eye drops, antacids, etc. The liability risks can include employees experiencing adverse reactions because of cross contamination, unknown medical conditions, expired drugs, and items taken by mistake. These issues occur as a result of poorly managing and monitoring first aid kits. While the chance of an incident may be small, the liability can be significant.

Need information specific OSHA regulations for your state? Visit

May an employer require that exempt personnel use vacation time?

Yes. According to a Department of Labor Opinion Letter, "[s]ince employers are not required under the FLSA to provide any vacation time to employees, there is no prohibition on an employer giving vacation time and later requiring that such vacation time be taken on a specific day(s). Therefore, a private employer may direct exempt staff to take vacation or debit their leave bank account . . . , whether for a full or partial day's absence, provided the employees receive in payment an amount equal to their guaranteed salary." See FLSA2009-2, Further, ("[E]mployers, without affecting their employees' exempt status, may take deductions from accrued leave accounts."). Therefore, it is our opinion that the employer may require exempt employees to use accrued vacation time for any absence, including one resulting from a plant shutdown, without affecting their exempt status, provided that employees receive a payment in an amount equal to their guaranteed salary. "[A]n exempt employee who has no accrued [vacation] benefits . . . or has a negative balance . . . still must receive the employee's guaranteed salary for any absence(s) occasioned by the employer or the operating requirements of the business." See FLSA2005-41,

Does a safety bonus have to be included in overtime calculations for the month?

Yes, if the bonus is nondiscretionary, overtime for the time period must be recalculated. According to a January 2009 Department of Labor Opinion Letter, "When the amount of the bonus can be ascertained, it must be apportioned back over the workweeks of the period during which it may be said to have been earned. The employee must then receive an additional amount of compensation for each workweek that he worked overtime during the period equal to one-half of the hourly rate of pay allocable to the bonus for that week multiplied by the number of statutory overtime hours worked during the week." See FLSA2009-21,

If the company gives employees gift cards as part of a "spot" bonus, is it taxable benefit or income?

Yes, according to IRS, gift cards, "no matter how little, are never excludable as a de minimis benefit, except for occasional meal money or transportation fare," thus they are taxable benefits to the employee. See IRS's Publication 15-B, under De Minimis (Minimal) Benefits,

What administrative fees may an employer charge for a garnishment or child support order?
Where do federal, state, and local employment posters have to be posted?

Most federal, state, and local laws require that required employment posters be displayed in areas that employees and applicants can readily see them. Depending on your facility's layout this may require two areas, such as a break room (for employees) and a waiting area or interview room where applicants normally reside. Note that some smaller employers are not covered under certain laws, such as the Family and Medical Leave Act.

What are the laws on paid and unpaid breaks?

You must look at both federal and state law for the answer.

For federal law, the U.S. Department of Labor's web site says:
Federal law does not require lunch or coffee breaks. However, when employers do offer short breaks (usually lasting about 5 to 20 minutes), federal law considers the breaks as compensable work hours that would be included in the sum of hours worked during the work week and considered in determining if overtime was worked. Unauthorized extensions of authorized work breaks need not be counted as hours worked when the employer has expressly and unambiguously communicated to the employee that the authorized break may only last for a specific length of time, that any extension of the break is contrary to the employer's rules, and any extension of the break will be punished.

Bona fide meal periods (typically lasting at least 30 minutes), serve a different purpose than coffee or snack breaks and, thus, are not work time and are not compensable.

Rest periods of short duration, running from 5 minutes to about 20 minutes, are common in industry. They promote the efficiency of the employee and are customarily paid for as working time. They must be counted as hours worked. Compensable time of rest periods may not be offset against other working time such as compensable waiting time or on-call time. (Mitchell v. Greinetz, 235 F. 2d 621, 13 W.H. Cases 3 (C.A. 10, 1956); Ballard v. Consolidated Steel Corp., Ltd., 61 F. Supp. 996 (S.D. Cal. 1945))

For state laws on meal breaks see

For state laws on rest breaks see

May an employer make deductions to an employee's salary without jeopardizing the employee's exempt status?

Deductions from a guaranteed salary are allowed only in limited circumstances.

Deductions from pay are permissible: when an exempt employee is absent from work for one or more full days for personal reasons other than sickness or disability, or is absent for one or more full days due to sickness or disability if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for salary lost due to illness; to offset amounts employees receive as jury or witness fees, or for military pay; for penalties imposed in good faith for infractions of safety rules of major significance; or for unpaid disciplinary suspensions of one or more full days imposed in good faith for workplace conduct rule infractions. Also, an employer is not required to pay the full salary in the initial or terminal week of employment, or for weeks in which an exempt employee takes unpaid leave under the Family and Medical Leave Act. SS 541.602(b).

Follow-up Question: If an exempt-employee (who is without accrued benefit time) is absent (full days) from work for part of a week due to their own sickness/disability do they get paid for the whole week?

Answer: Yes, they get paid the full week's salary.

Follow-up Question: If employee without benefit time is absent (full days) from work for a whole week due to their own sickness /disability do they get paid for the whole week?

Answer: Employers may take partial day deductions from an employee's leave bank, even if the deduction results in a negative leave balance; however, an employer may not dock an exempt employee's salary for a partial day absence. Under the final rules, employers may take deductions from employees' leave accounts for partial day absences, the same as under the old regulations. The preamble specifically states that "employers, without affecting their employees' exempt status, may take deductions from accrued leave accounts...." 69 Fed. Reg. at 22178. The preamble also cites approvingly to a number of Wage and Hour Division opinion letters allowing deductions from accrued leave accounts. Additional opinion letters, dated December 4, 1998, May 27, 1999, and February 16, 2001, similarly provide that employers may reduce the amount of accrued paid leave in an employee's Paid Time Off plan, even if the employee is absent only for a partial day. The employer may reduce the leave so that the employee has a negative leave balance. However, the employee must receive the full guaranteed salary, even if there is no leave in the account or there is a negative balance, if the employee has only a partial day absence." (see

Also, in order for executive, administrative, or professional employees to be considered exempt under the FLSA, such employees must be paid on a salary basis. Employees are considered to be paid on a salary basis within the meaning of the Act if under their employment agreements they regularly receive in each pay period a predetermined amount which is not subject to reduction because of variations in the quality or quantity of the work they perform. The only exceptions under which an employer may make deductions from an employee's salary without disturbing that employee's "salaried" status are when:

  • the employee is absent from for one or more full days for personal reasons other than sickness or disability;
  • the employee is absent for one or more full days due to sickness or disability if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for salary lost due to illness;
  • the deduction is used to offset amounts the employee receives as jury or witness fees, or for military pay;
  • the deduction is a penalty imposed in good faith for infractions of safety rules of major significance; or
  • the deduction is for an unpaid disciplinary suspension of one or more full days imposed in good faith for workplace conduct rule infractions, such as for sexual harassment or workplace violence.

Thus, because employees must receive their full salaries for any week in which they perform work without regard to the number of days or hours worked in order to be considered exempt from the minimum wage and overtime provisions of the FLSA, the effect of subjecting an exempt employee's pay to unpermitted deductions for being late or absent is that the exemption is inapplicable to that employee during the entire period when such deductions were made.

Indeed, such deductions are antithetical to the concept of a salaried employee, because a salaried employee is compensated not for the amount of time spent on the job, but rather for the general value of services performed. It is precisely because executives are thought not to punch a time clock that the "salary test" for such employees requires that their predetermined pay not be subject to reduction because of variations in the quantity of work performed, especially when hourly increments are at issue. (source: Commerce Clearing House)

Follow-up Question: For an exempt-employee where an absence is for one or more full days due to sickness or disability and a the deduction is made in accordance with a bona fide plan, policy, or practice of providing compensation for salary lost due to illness;
does this mean deductions from pay are permissible if made in accordance with bona fide plan, policy? And .......what is considered a bona fide plan, policy?

Answer: Yes, deductions from a bona fide policy/plan are permissible for sickness/disability (however keep in mind that this means that the employee is still getting their normal paycheck).

A "bona fide plan, policy" has been defined by the Department of Labor as a "...benefits that have been communicated to eligible employees, and that operates as described in the plan, will in general qualify as bona fide. In addition, to be bona fide, the plan must be administered impartially, and its design should not reflect an effort to evade the requirement that exempt employees be paid on a salary basis.... It is also our position that a reasonable number of absences on account of sickness ordinarily must be allowed without loss in pay to exempt employees.... The Wage and Hour Division, however, previously has approved leave plans that allow for at least 5 days of sick leave per year as bona fide under the regulations.... Moreover, with respect to a qualifying period, the Wage and Hour Division previously deemed a leave plan that required one year of service prior to payment of sick pay benefits to be bona fide." See, September 14, 2006, FLSA2006-32 letter.

For more information, see the DOL Wage/Hour Field Operations Manual (May 2016) and specifically 22g13 and 22g14.

Do employers have to pay for safety shoes?

In November 2007, the Occupational Safety and Health Administration (OSHA) issued a final regulation ( regarding payment of Personal Protective Equipment, which mostly takes effect in May 2008. The final rule states that employers must pay for most all Personal Protective Equipment that employees are required to use on the job, but there are a few exceptions, such as for "ordinary safety-toed footwear, ordinary prescription safety eyewear, logging boots, and ordinary clothing and weather-related gear." With regards to steel-toe shoes or boots, 1915.152 (f) says: "(2) The employer is not required to pay for non-specialty safety-toe protective footwear (including steel-toe shoes or steel-toe boots) and non-specialty prescription safety eyewear, provided that the employer permits such items to be worn off the job-site. (emphasis added) (3) When the employer provides metatarsal guards and allows the employee, at his or her request, to use shoes or boots with built-in metatarsal protection, the employer is not required to reimburse the employee for the shoes or boots."

What is the average turnover rate in the printing industry?

According to Printing Industries of America's 2013 national Wage and Benefit Survey, the average employee turnover in the printing industry was: 8.6%.

Does the company have to re-verify employment authorization on I-9 Forms for aliens?

It depends on which document the employee initially uses to verify employment authorization and identity. If the employee checks the third box in Section 1 of the I-9 form ("alien authorized to work until..."), indicating that he/she only has temporary work authorization, the employee must list the expiration date in Section 1 next to that third box. That's a deadline by which the employer must re-verify continued work authorization, if the employer wishes to continue the employment beyond that deadline. If the employee presented an "Employment Authorization Card" for I-9 purposes as a List A document, that card also has an expiration date (usually one or two years, sometimes a little longer), which means that the employment authorization will end on that date. This needs to be re-verified by the deadline also, if the employer wishes to continue the employment beyond that date. If the employer had sponsored the employee for an employment visa (e.g. H-1B visa, or L-1 visa, or TN visa, etc.), those visas also expire on a given day and need to be re-verified (usually, the employer requests an extension of the visa before the expiration date).

Green cards, on the other hand, which are called Permanent Resident Cards (the new gold-looking ones) or Resident Alien Cards (the previous pink & blue ones) or Alien Registration Receipt Cards (the very old white ones) DO NOT have to be re-verified, even though they may have an expiration date. These cards are evidence that the individual is a permanent resident in the U.S., who has permanent work authorization (just like US citizens). The only caveat is that when an employee is first hired and completes an I-9 form, he/she cannot present such a green card as a List A document, if at that time the green card is already expired (employer cannot accept an expired green card for I-9 purposes). (Source: Bernhard W. Mueller, Ogletree, Deakins, Nash, Smoak & Stewart, P.C.)

Does the Fair Labor Standards Act (FLSA) require an employer to pay employees who miss work because of the weather?

The answer to this question depends on whether the employee is exempt or non-exempt.

Exempt Employees: If the business closes because of the weather, the FLSA requires employers to pay an exempt employee his or her regular salary for any shutdown that lasts less than a week. Under the FLSA, an employer cannot deduct an exempt employee's pay based on the quantity or quality of the employee's work or when he or she is ready, willing and able to work but no work is available. Thus, deducting an exempt employee's pay for absences due to a business closing that lasts for less than a week would jeopardize the employee's exempt status. A private employer may, however, deduct the period of absence from the employee's paid vacation or paid time off, as long as the employee receives his or her full salary for the week.

If the business remains open but an employee cannot get to work because of the weather, an employer can deduct an exempt employee's salary for a full day's absence. Under the FLSA, an employer can deduct an exempt employee's pay for a full-day absence taken for personal reasons without jeopardizing the employee's exempt status. Employers cannot, however, deduct an exempt employee's salary for less than a full-day absence without jeopardizing the employee's exempt status.

Nonexempt Employees: Under the FLSA, employers generally are not required to pay nonexempt employees for any days that the employee does not perform any actual work. Thus, employers are not required to pay employees for days they did not come to work or for days when the business was closed because of a weather event. This does not apply to nonexempt employees who are paid on a fluctuating workweek basis (which is rare and difficult to administer). 

Employers often will have a policy in place determining weather-related closures, notification, and use of paid leave.

State Reporting Pay Requirements: Be aware that some states have reporting pay or "show-up" pay requirements that require employers to pay a minimum amount to employees who show up for work even if they do not perform any work. States that have such requirements include California, Connecticut (certain industries), Massachusetts, New Hampshire, New Jersey, New York, Oregon (this law only applies to minors), and Rhode Island as well as the District of Columbia. Employers should familiarize themselves with the requirements of these state laws. Additionally, collective bargaining agreements may require employers to pay employees for a guaranteed minimum number of work hours regardless of the number of hours actually worked.

If a person is out and they pay their portion of the medical deductions via check (after tax) is that in violation of our Section 125 plan where deductions are pre-tax?

No. Under SS1.125-3, Effect of the Family and Medical Leave Act (FMLA) on the operation of cafeteria plans, contributions under the pay-as-you-go option are generally made by the employee on an after-tax basis. However, contributions may be made on a pre-tax basis to the extent that the contributions are made from taxable compensation (e.g., from unused sick days or vacation days) that is due the employee during the leave period. See

If a new hire quits soon after he/she is eligible for the health care plan, is that employee (and dependents) eligible for COBRA even though the employee has not paid any premium yet?

Yes, if that employee had submitted the proper health care enrollment paperwork when eligible and before the notice of quit. (We are aware of this happening a few times in our industry where the employee was moonlighting and his/her real motivation was to obtain better/cheaper health care coverage. We suggest firms have a moonlighting policy and verify all prior work history.)

Can you throw away old background check information your company has obtained, including application forms and consumer reports?

Yes, but timing matters. According to the Equal Employment Opportunity Commission (EEOC), any personnel or employment records you make or keep (including all application forms, regardless of whether the applicant was hired, and other records related to hiring) must be preserved for one year after the records were made or after a personnel action was taken, whichever comes later. The EEOC extends this requirement to two years for educational institutions and for state and local governments. The Department of Labor also extends this requirement to two years for federal contractors that have at least 150 employees and a government contract of at least $150,000. If the applicant or employee files a charge of discrimination, you must maintain the records until the case is concluded.

The Federal Trade Commission requires that once you've satisfied all applicable recordkeeping requirements, you may dispose of any background reports you received. However, the law requires that you dispose of the reports -- and any information gathered from them -- securely. This can include burning, pulverizing, or shredding paper documents and disposing of electronic information so that it can't be read or reconstructed.

Source: Background Checks: What Employers Need to Know; Disposing of Consumer Report Information? Rule Tells How.

Must an employer provide ALL the directions for Form I-9 to new hires?

Yes, USCIS says that employers must provide to each new hire the complete directions for Form I-9. The employer may however, keep these instructions and reuse them for other new hires. Some employer laminate the instructions. 

If we perform credit and/or criminal background searches on applicants, do we have to give notice beforehand?

Yes, and it must be a separate notice from all other notices and information. See