Who can tell me who won the Who can tell me who won the MNF game this week?MNF game this week?

What is the premise that What is the premise that underlies both the Federal and underlies both the Federal and

Ontario Tax system?Ontario Tax system?

Both systems can be described Both systems can be described as graduated or progressive as graduated or progressive systems in that the more an systems in that the more an individual earns in taxable individual earns in taxable income, the higher their income, the higher their

personal tax rate.personal tax rate.

What is meant by the term What is meant by the term “Taxable Income” and how does “Taxable Income” and how does

it differ from a person’s total it differ from a person’s total income?income?

Taxable Income = total income Taxable Income = total income from all Sources – allowable from all Sources – allowable

deductionsdeductions

What is the concept of a surtax?What is the concept of a surtax?

A surtax is a tax paid on your A surtax is a tax paid on your taxes. In Ontario it is known as taxes. In Ontario it is known as

the “Fair Share Health Care the “Fair Share Health Care Levy”Levy”

$28,000$28,000

FTP 28000*16% $4,480.00PTP 28000*6.05% $1,820.00PS 0 $0.00

$6,300.00

$32,300$32,300

FTP 5149 + 22% (32,300-32,183) $5,174.74PTP 32,300*6.05% $2,099.50PS 0 $0.00

$7,274.24

$40,000$40,000

FTP 5149 + 0.22 (40,000-32,183) $6,868.74PTP 1,962 + 9.15%(40,000-32,435) $2,654.20PS 0 $0.00

$9,522.94

$58,000$58,000

FTP 5149 + 0.22(58,000-32,183) $10,828.74PTP 1,962+9.15%(58,000-32,435) $4,301.20PS 0.20*(4,301.20-3,747) $110.84

$15,240.78

$63,200$63,200

FTP 5149+0.22*(63200-32183) $11,972.74PTP 1962+0.0915*(63200-32435) $4,777.00PS 196+0.56(4777-4727) $224.00

$16,973.74

$64,500$64,500

FTP 12230+0.26*(64500-64368) $12,264.32PTP 1962+0.0915*(64500-32435) $4,895.95PS 196+0.56(4895.948-4727) $290.61

$17,450.88

$95,000$95,000

FTP 12230+0.26*(95000-64368) $20,194.32PTP 4930+0.1116*(95000-64871) $8,292.40PS 196+0.56*(8292.396-4727) $2,192.62

$30,679.34

$263,000$263,000

FTP 22703+0.29*(263000-104648) $68,625.08PTP 4930+0.1116(263000-64871) $27,041.20PS 196+0.56*(27041.20-4727) $12,691.95

$108,358.23

Jeff Martin CaseJeff Martin Case

• Who has read the case and prepared solutions?

• Please get into your groups and discuss your ideas.

Immediate ProblemImmediate Problem

• What action should be taken to deal with Jeff Martin’s attempted theft of company property?

What is a policy?What is a policy?

• A policy is a guide to managerial decision-making for recurrent situations.

Why do organizations need to Why do organizations need to develop policies for recurrent develop policies for recurrent

situations?situations?

A well defined policy means that A well defined policy means that manager’s do not have to manager’s do not have to

rethink how a particular situation rethink how a particular situation should be handled each time should be handled each time that it occurs. The mgr simply that it occurs. The mgr simply

applies the policy that has been applies the policy that has been developed to deal with the developed to deal with the

recurrent situation.recurrent situation.

Policy vs. RulePolicy vs. Rule

• A policy is not the same as a rule.

• Good policies realize that circumstances surrounding recurrent situations will vary from case to case and allow for managerial discretion.

• A rule on the other hand is stated as an absolute and does not allow any flexibility in its interpretation

Primary ProblemPrimary Problem

• The company policy regarding employee theft – “Anyone caught stealing from the firm will be immediately dismissed without severance pay” – is extremely rigid. In reality it is not a policy, it is a rule

Decision CriteriaDecision Criteria

• It should be fair. Any disciplinary action taken should be in keeping with the nature of the offence. A basic tenet of good discipline is that it should be corrective not punitive.

• It should reinforce the company’s position that any form of employee theft is unacceptable.

• It should show that mgmt appreciates outstanding employee service.

AlternativesAlternatives

• Apply company policy and dismiss Jeff without severance.

• Ignore the entire incident in light of Jeff’s double shifting and past record.

RecommendationRecommendation

• The best solution should entail some form of disciplinary action for Jeff’s attempted theft.

• Any organizational system of progressive discipline should attempt to use the lowest level of discipline necessary to invoke a permanent change in employee behaviour.

ImplementationImplementation

• Jeff’s immediate supervisor should be informed of all of the details surrounding the incident.

• Supervisor should convene a meeting with Jeff and deliver a verbal warning.

• Jeff should be asked to acknowledged before a witness that he understands why he is being disciplined and the consequences associated with a second violation.

Implementation cont.Implementation cont.

• The supervisor should try to maintain some sense of perspective by acknowledging Jeff’s significant contributions to the firm.

• Most importantly mgmt must realize that their policy is far too rigid and needs to be rewritten.

Due Next WeekDue Next Week

• Tax sets #2 and #3

• Twin City Credit Union Case

• Should have registered for the Stock Market Competition by the. $25 online at invest.wlu.ca

• Read the Stock Market Game Player’s Manual