Hiring, Motivating And Retaining Rock Star Marketers

This month, our strategic partners over at ODEA, decided on a new format for their bi-annual whitepaper. After being inspired by the community of members who attended and engaged at the Strategic Partner Night of Knowledge, they decided to record a podcast focused on getting the best possible marketers in the door. Listen as Patty Rioux discusses how she has found success in hiring, motivating, and recruiting truly rockstar employees and what it takes to keep them happy and keept them with her!


-EFBC Strategic Partner ODEA


Helping Our Businesses Weather Inflation

A blog, from our friends and strategic partner ODEA.

As business owners, we are always tackling the next challenge. We’ve previously shared some tips on how EFBC members and other businesses have weathered the pandemic and ongoing supply chain disruptions. Now let’s share some suggestions on surviving the latest storm to cross our paths, inflation.

Look for Lost Dollars

With everything from raw materials to employee benefits costing more, we are all seeing the expense side of our monthly accounting reports rising. Have you paused to take a deep dive into each line item for any dollars that may be slipping through the cracks? Do you have any monthly or yearly subscriptions that you are not using? Perhaps you switched from Harvard Business Review to Wall Street Journal but never canceled HBR. What about all the technology platforms you are no longer using? Monthly auto renews of those tried-but-never-really-caught-on platforms and technologies may be small but add up over time. (See you later Prezi!)

Spend now. Save later.

With all companies dealing with the same inflation-induced woes, many organizations are offering incentives to their customers to buy more or pay ahead to increase their cash flow. If your own cash flow allows such opportunities to lock in prices or pay-in-full before the next price increase can be significant. Publicly traded companies concerned about their next quarterly earnings report will often more freely negotiate as the end of a quarter approaches, especially if your salesperson can book a large deal from you. (Yes, we’re looking at you HubSpot and Salesforce.)

Get Creative with Cost Increases

There is only so far decreasing your costs will be able to take you in combating inflation. Reality is, most of us are having to consider raising costs as well. Go ahead and consider implementing your own “buy now, save later” deal to lock in your top-tier or most profitable customers. Think about bundling products or services to increase order size with items your customers likely buy anyway. Or what about offering a subscription that eliminates the need for your customers to remember to re-order? It works for Amazon, it just might work for you!

When it Comes to Cost Increases, Communication is Key

You already know this from being on the receiving end of price increases, but communication (like most things in life) is key. Give your customers as much notice as possible that a price increase is coming. Help them understand why you are raising your costs and if they can expect any additional increases in the short or long term. If possible, give them some ways you might be able to help them absorb these costs such as longer payment terms. In short, communicate early and communicate often.

Call On Your Team

Not only are we as businesses dealing with the onslaught of inflation, but we as humans are too. Those utility bills are increasing for us all! Your employees are needing to come up with creative solutions for combating inflation in their personal lives. Ask for their input! Involve them in the process and invite them to impact your organization’s income and outgo just as they are doing at home. With the collective brilliance in your organization and within our community at EFBC, you’ve got the resources you need to weather this inflation storm and keep moving towards sunnier days.


Now Hiring! From Anywhere!

Two of EFBC’s Strategic Partners share considerations when hiring employees who live out of state.

It seems like everywhere you look these days you see “Help Wanted” and “Now Hiring” signs. We know that many EFBC members are also trying to add talent to their teams, and for some, that has been a challenging process. With more and more companies adopting flexible work arrangements, expanding the talent pool and hiring employees outside of Chicagoland and even out of the state is becoming a more feasible option. But it’s not without complications. That’s why we went straight to the experts! EFBC’s Strategic Partners Karen Snodgrass at Cray, Kaiser Ltd and Rachel Bossard, at Burke, Warren, MacKay & Serritella give actionable guidance from a tax and legal perspective when contemplating hiring a team member from out of state.

We first spoke with Karen Snodgrass, CPA, Principal at Cray, Kaiser Ltd. and asked for her insights on the tax implications of hiring workers from out of state.

What tax considerations do employers need to keep in mind when hiring from outside their state?

It really depends on what that individual will be responsible for tackling. There can be some legal protections for the company from a tax standpoint. For example, if you have an employee that is only selling widgets from of a state other than Illinois, you may not be subject to all of the other state’s tax laws. But in general, anytime you hire an employee in another state, you are opening the company up to the tax provisions of that state. That could be anything from unemployment tax to withholding taxes, meaning you will need to withhold the other state’s taxes from the employee’s income. Hiring across the border could also open the business up to filing tax returns in that other state. Our recommendation is before you consider hiring someone in another state, definitely fully understand what your tax exposure will be.

Do the tax laws differ greatly from state to state?

Every state has its own rules, and every state has its own tax rate. For example, if your company is located in New York then you file income tax returns in New York. The New York tax rate is higher than Illinois. It doesn’t mean that you’re necessarily double-taxed, but it does mean less of your income will be taxed in Illinois and more is taxed in New York. Ohio, on the other hand, has different tax laws where only businesses that earn more than a specified amount are subject to tax in Ohio. So yes, tax laws do vary greatly.

I’ve had companies hire an individual in another state and based on that team member’s role, the company is not required to withhold state taxes.  Which means that the employee is then responsible for paying in-state taxes on a quarterly basis.   In terms of the employer/employee experience, especially in this labor market, telling a new employee their tax burden is increasing is not ideal.  This goes against why employers are crossing state lines to attract team members in the first place. Most companies want to make it as easy as possible for their new employees.

Does Illinois have any special agreements with border states with regard to taxes?

The state of Illinois has tax reciprocity with Iowa, Kentucky, Michigan, and Wisconsin.

Are there any major drawbacks from a tax perspective?

It is not necessarily a drawback, especially when finding top talent is a challenge, but you need to be aware that you are exposing your organization to the tax requirements of different states which may add complexity for your tax teams. There are added compliance costs when an organization has team members in multiple states, as well as the possibility of higher taxes in that other state, including higher unemployment taxes or higher business income taxes.

Anything else you would like to share on the subject?

As employers, we all have to think outside the box these days. If there’s talent sitting in another state, you simply have to understand the additional costs associated with hiring that person. Long term, this employee may be a better fit or a higher skill set than someone you can find locally. If so, it may well be worth those costs. It is all about understanding your exposure so you can make that business decision, knowing if those extra dollars are nothing (if hiring in a state with reciprocity), are a few hundred dollars a year or are substantial. As with most things in business, it is being armed with knowledge so you can make a purposeful decision.

Rachel Bossard, Partner at Burke, Warren, MacKay & Serritella, P.C. also shared her knowledge on hiring employees who live in another state from a legal perspective.

From a legal perspective, what are the top three things to consider when hiring out of state?

When hiring an employee who will be working in another state, it is important for the employer to consider:

  1. Whether it needs to form a corporate entity/apply for a tax ID number in the other state in order to pay payroll taxes
  2. Whether the employer will need to obtain workers’ compensation insurance and pay for unemployment insurance in the other state
  3. Whether there are any state-specific employment laws that will apply to the employee in the other state

How different are labor laws from state to state? Any states that are particularly challenging?

Many laws differ from state to state, in particular the laws related to employee family or medical leave and sick time. In addition, state laws can vary regarding restrictive covenants such as non-solicitation and non-competition agreements. California is probably the most challenging state to contend with. For example, in addition to a complex set of leave laws that can vary by municipality, California requires that employers pay overtime to non-exempt employees who work more than eight hours per day, whereas Illinois requires the payment of overtime compensation only in excess of 40 hours per week. Also, it is worth noting that restrictive covenants are unenforceable in California.

What happens when the employer state and employee state have conflicting laws?

In most instances, the employee state will prevail. However, this depends on the state and the particular law.

Does Illinois have any special agreements with border states regarding employment/labor laws?

Illinois has reciprocal agreements with Iowa, Kentucky, Michigan, and Wisconsin. As a result of these agreements, residents of those states who received compensation from Illinois employers, are not required to pay Illinois income tax on this income. This applies only to compensation received from wages, salaries, tips, and commissions.

Are there any major drawbacks from a legal perspective?

It can be complicated to have employees in several different states who may be bound by different laws, which require different employee policies and different employee handbooks or separate addendums for each state.

Anything else that you think is important to note?

While it can appear daunting, employers should not be so overly concerned about employing out-of-state residents that they stifle the needs of the business. Rather, employers should simply be mindful of the potential legal complications and should obtain the assistance needed to comply with the laws. Once compliance has been established, the monitoring necessary to maintain compliance should be minimal.

The key takeaway? Don’t be deterred if you find the perfect candidate and they live beyond the Illinois border. Simply do your homework – with the help of EFBC’s Strategic Partners – and understand the tax exposure for your business as well as the legal implications.