That’s what happened to an Illinois man, who’s now in court as a result of his great gig.

Anthony Armatys accepted a job with New Jersey-based Avaya, Inc., before he changed his mind and declined. But the company’s payroll system never removed his name from the list of employees.

So Armatys stayed quiet and received his salary until Avaya’s auditors discovered the mistake — nearly four and a half years later, the Associated Press reports.

Armatys has plead guilty to theft. Prosecutors are recommending six years in jail plus restitution.

Though the company will probably get the money back, some more careful auditing could have done the trick.

Here are three pitfalls to watch out for:

1. You get what you pay for

By and large, the cost savings from a wellness program will be driven by how much you’re willing to spend. Generally, you get what you put into them — both in time and money.

In addition, the program has to be tailored to your specific needs. What works at another company may be a giant flop with your workforce.

2. Tough to administer alone

Most employers find that it’s more effective to outsource wellness. Three reasons:

• Experience. Outsourced vendors have the expertise. They’ve been there, done that — and vendors that’ve been around for a while know how get results.
• Employees’ trust. Many employees are more involved in wellness programs when there’s no fear their employer is looking over their shoulders.
• Legal protection. Outsourcing helps insulate you from later claims that the company fired an employee because of his or her health risks.

3. Tax problems

Some of the most popular incentives offered to employees in wellness plans (think subsidized gym memberships) are taxable as compensation.

If you offer wellness participants discounts on their premiums, the Internal Revenue Service (IRS) caps the incentive at 20% of the total cost of coverage. Beyond that, Payroll has to withhold taxes or you could run afoul of the IRS.

In fact, 51% of employees said they’d accept a lower wage if their work contributes to something “more important or meaningful,” found a recent survey by Kelly Services.

So how can managers at your company make employees stick around, even if Payroll’s not cutting bigger checks?

Give employees more control

People enjoy their jobs more when they feel valued and in command of their own work.

To ensure employees feel this way, make sure their managers allow them to weigh in on important decisions — and give them complete autonomy over certain tasks, as well as the opportunity to take on more challenging assignments.

Keep them in the loop

Giving employees updates on the big picture makes them feel valued and important.

A few ways that work:

• Explain management’s decision-making strategies to employees
• Invite staffers to important meetings, and
• Provide workers with documentation and other proof of the company’s success.

Give them chances to grow

No one wants to believe he or she will be doing the same tasks five years down the road.

If your employees don’t see any opportunities on the horizon, chances are they’ll be updating their resumes before long.

To avoid high turnover, offer:

• education and training opportunities
• career-path advancement
• team participation, and
• cross training.

The agency’s alerting the public about a new wave of identity theft scams, one of which involves an e-mail about the Making Work Pay tax credit. That’s the recent legislation that allowed Payroll Departments to put more money into workers’ paychecks by following revised withholding tables. However, the e-mail tells recipients that consumers and retirees can get the money paid directly into their bank accounts – just by clicking the enclosed link. Those that fall prey to the scam enter their name and account info.

Let employees know two important facts:
1. Taxpayers who aren’t wage earners (like retirees) don’t qualify for the tax credit.
2. IRS doesn’t discuss tax account matters with taxpayers via e-mail. Recipients should delete these messages, even if they include the IRS name, logo or Web site. If an e-mail is questionable, call the local IRS office (with a number from your phone book, not the e-mail) to confirm its validity.

Passing on this info isn’t just a public service – it’ll prevent angry or upset employees from barraging HR and the Payroll Department with questions.

Other ‘phishing’ scams
IRS says employees will also want to avoid several other “phishing” scams now circulating, including e-mails from:

• the Department of Treasury telling the recipient he/she will receive millions of dollars in recovered funds or lottery winnings or cash consignment if they provide certain personal information, including phone numbers, via return e-mail
• fraudsters that modify a genuine IRS form, the W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding. The e-mail may request detailed personal and financial information, such as passport number, bank account and PIN numbers, spouse’s name and mother’s maiden name, etc. The message may include the official form name/number or may make up a new one, such as W-4100B2.

Go here for more info on phishing and identity theft, as well as learn how to report suspicious e-mails.

1. Adjust creditor garnishment amounts. Employees with creditor garnishments in place may start receiving even smaller paychecks. Payroll must base withholding for these orders using the federal minimum wage in effect when the person gets paid, not when the order was issued. So, if a creditor garnishment was received in January when the federal minimum wage was $6.55 per hour, withholding would be based on that amount through July 23, then on the new $7.25 rate beginning on July 24. (Give employees a heads up – otherwise, they’re bound to have questions about the increase.)

Be careful – there are limits to how much can be withheld. Under the Consumer Credit Protection Act, Payroll may only withhold from employees’ wages to repay a creditor debt the lesser of:
• 25% of disposable wages, or
• the amount by which the disposable earnings are greater than 30 times the federal minimum wage. That’s $217.50, or $7.25 per hour x 30, for someone paid weekly.

2. Watch out for improper deductions. Under the Fair Labor Standards Act (FLSA), employers can’t make deductions from an employee’s paycheck for items that reduce workers’ wages below the federal minimum wage, such as cash or merchandise shortages, employer-required uniforms or tools.

3. Check the tip credit. The FLSA says you may pay tipped employees $2.13 per hour, as long as tips are enough to make up the rest of the federal minimum wage. On 7/24/09, the tip credit changes to $5.12 ($7.25 – $2.13), up from $4.42 ($6.55 – $2.13).

More help
If you need additional info, the U.S. Department of Labor offers these useful resources:

1. Minimum-wage fact sheet.
2. Q&As.

You’ll be able to mask all but the last four digits of Taxpayer Identification Numbers (TIN) on 1099s that go from payer to payee. In addition to a Social Security Number, the number on Forms 1099 could be an employer ID or individual taxpayer ID number (ITIN).

Employers that choose to mask the numbers on workers’ 1099s will still have to include the full nine-digit number on the copy filed with IRS.

When the change comes, TIN-masking would be optional for 2009 and beyond, Deborah Wolf, director, IRS Office of Privacy, Information Protection and Data Security told attendees of the American Payroll Association’s (APA) Capital Summit.

The idea’s not being widely embraced, however. Only 37% of respondents in a recent APA survey said they’d adopt the practice for 2009 forms. Another 37% said they would begin masking in Tax Year 2010.

Those on the other side of the coin – the 26% who don’t plan to adopt TIN-masking – fear there’ll be no other way for the payee to verify that the payer has the correct number.

What about W-2s?
Don’t count on seeing a similar option for Forms W-2 any time soon. TIN-masking on them would have to be authorized by Congress because the Internal Revenue Code is clear that all nine digits are required on the W-2, says Wolf.

Sixty-seven percent of APA survey respondents said they’d mask SSNs on the W-2s, with many others again citing fear of using incorrect numbers as the biggest drawback.

Here’s a summary of three IRS updates you’ll need:

1. Forms W-2, W-3, 1098, 1099 and 5498 . Although there are no changes to the forms themselves, take another look at what IRS calls the “lead attention page.” This summary page says that on both the 2008 and 2009 Forms W-2, W-2c, W-2AS, W-2GU, W-2VI, W-3, W-3c, W-3PR, or W-3SS, the sentence “Do not file copy A with SSA” has been changed to “Do not file copy A downloaded from this website with the SSA.”

If you downloaded 2008 or 2009 Forms 1098, 1099, or 5498, note that on the lead attention page, the phrase “Do not file copy A with IRS” has been changed to “Do not file copy A downloaded from this website.”

The official printed version of IRS forms copy A is scannable, but the online version of it, printed from the IRS Web site, isn’t.

2. Publication 15-B, Employer’s Tax Guide to Fringe Benefits. Although the info in the printed copy isn’t accurate, IRS won’t issue a revised edition until next year. Note that on page 20, under the heading “Exclusion from Wages,” the first bullet point should read:

“For combined commuter highway vehicle transportation and transit passes:
a. $120 per month for the months of January and February 2009 and
b. $230 per month for the months of March through December 2009.”

This change was made as a result of the American Recovery and Reinvestment Act of 2009.

3. Publication 15 (Circular E), Employer’s Tax Guide. Chances are you downloaded the 2009 copy of this payroll bible before 3/31/09. If that’s the case, you’ll want a new one from www.irs.gov/formspubs/article/0,,id=109875,00.html.

Here’s why:

New tables for withholding and advance earned income credit (EIC) payments have been developed due to the American Recovery and Reinvestment Act of 2009. The new tables can be found in Publication 15-T, New Wage Withholding and Advance Earned Income Credit Payment Tables (For Wages Paid Through December 2009).

On page 11, the first sentence under “Employee Business Expense Reimbursements” has been changed and now reads, “A reimbursement or allowance arrangement is a system by which you pay the advances, reimbursements, and charges for your employees’ business expenses.”

On page 11 under Accountable plan:
a. The last sentence in item 1 now reads “The reimbursement or advance must be paid for the expense and must not be an amount that would have been paid by the employee.”
b. Item 2 now says, “They must substantiate these expenses to you within a reasonable period of time.”
c. Item 3 now reads “They must return any amounts in excess of substantiated expenses within a reasonable period of time.”
On page 20 in the “Caution” under the section titled “How to Figure the Advance EIC Payment,” amounts previously reported as “$35,464″ and “$38,584″ now read “$35,463″ and “$40,463,” respectively.
On page 24 under “How to deposit with a FTD coupon,” IRS added three new paragraphs at the end of this section to advise the financial agent can’t process foreign checks. If you send a check written on a foreign bank to pay a federal tax deposit, generally you will be charged a deposit penalty and will receive a bill in the mail.

Some employees may be shocked April of next year when they’re stuck with a big tax bill – because of the stimulus package that, ironically, was designed to add money to their paychecks. But an alert from you and your Payroll dept. can help workers avoid the problem.

Here’s why: President Obama’s “Making Work Pay” tax credit, a part of the recent stimulus package, is the lesser of:
1. 6.2% of an employee’s earned income, or
2. $400 ($800 for married taxpayers filing jointly).

While the credit won’t significantly alter most employees’ 2009 tax status, married employees filing joint tax returns and those working multiple jobs may not be so lucky.

Here’s why: The credit phases out for a married couple filing a joint return whose modified adjusted gross income (AGI) is between $150,000 and $190,000, and for other workers whose modified AGI is between $75,000 and $95,000. That means that by the end of the year, these employees could be significantly underwithheld compared with what they owe Uncle Sam.

Of course, Payroll’s not responsible for tracking employees’ personal tax circumstances – but it can’t hurt to make available to everyone:

1. An explanation (e.g., e-mail, paycheck stuffer, etc.) of how they could end up underwithheld for 2009 and 2010.
2. Copies of IRS Publication 919, How Do I Adjust My Withholding? A worksheet on page 22 will help employees calculate the credit amount.
3. New Forms W-4. That way, if receiving this credit puts workers into a higher tax bracket, they can adjust their withholding.

1. Implement new withholding tables. The “Making Work Pay” tax credit means Payroll will begin withholding less federal income tax from workers’ pay, probably in June. The average American worker will see about $13 more per weekly paycheck in 2009, and about $9 more in 2010. The credit, which amounts to 6.2% of earned income up to $400 for single taxpayers ($800 for marrieds) begins phasing out at $75,000 ($150,000 for marrieds). Those who don’t get the credit through payroll can also claim it on their personal tax returns.

Nonresident aliens don’t qualify for this credit – only employees with valid Social Security Numbers.

It’s still unclear how companies should handle new hires who may have already received a portion of the credit from a previous employer.

2. Begin new reporting duties on Form 941. To help workers who are involuntarily terminated from work, the government’s now offering to subsidize 65% of COBRA premium payments. Here’s how it’ll work: Once an employee pays his or her 35% share, the company must then front the rest of the money. The employer will pay the insurer directly, then claim the amount as an offset against payroll tax liabilities. Payroll will report any subsidies made and take the offset on an updated Form 941 the IRS will soon release.

Employers will have to pay the premiums for up to nine months for workers (and their families) who are involuntarily terminated between 9/1/08 and 12/31/09. Anyone who was terminated after the 9/1/08 start date and the date’s enactment but didn’t take the coverage because of the expense has 60 days to elect COBRA and take advantage of the subsidy.

Employees with an annual income of $125,000 ($250,000 for families) don’t qualify for this assistance.

This provision will take effect with the first COBRA payment period – March 1st, for most employers. Form 941 reporting will also likely be effective for first quarter 2009.

3. Increase reporting to your higher-ups. You may have to more carefully track the wages of certain employee populations. Under the new law, businesses can claim a work opportunity tax credit equal to 40% of the first $6,000 wages paid to employees in nine particular groups (e.g., unemployed veterans, “disconnected” youth between the ages of 16 and 25 who are not in school, etc.).

4. Change the amount of tax-free transit benefits. Under the new law, employers can offer employees $230 a month, tax free, in parking and transit benefits for 2009. Previously, there were different dollar amounts allowed for each benefit.

5. Process more Forms W-5. In 2009 and 2010, the stimulus package increases the Earned Income Tax Credit for working families with three or more children to 45% of the family’s first $12,570 of earned income. The bill also increases the start point of the phase-out for married couples filing jointly by $1,880. As a result of these changes, more workers may submit Forms W-5 to receive the credit. Look for revised Advance Earned Income Tax Credit tables in Publication 15, Circular E.

6. Process more Forms W-4. Other employees may need to fill out a new Form W-4 to adjust their withholding in light of changes to federal income tax withholding (e.g., the ATM patch) and other tax credits (e.g., first-time home buyer credit). Watch for revised withholding tables and additional guidance.

Here’s a sampling of what other Accounting/Payroll professionals are being paid, according to the Robert Half International 2009 Salary Survey. Keep in mind, however, that specific job duties and geographic location can widely influence these salary ranges:

Large companies ($250M + in sales):
Payroll Manager/Supervisor: $50,500 – $74,000 (3.8% increase over 2008)

Payroll Coordinator/Administrator: $36,750 – $48,500 (up 3.6% over last year)

Payroll Clerk: $30,500 – $39,00 (3.7% increase)

Midsize companies ($25M to $250M in sales):
Payroll Manager/Supervisor: $43,000 – $57,750 (3.6% over 2008)

Payroll Clerk: $29,750 – $38,250 (up 3.4% from last year)

Small Companies (up to $25M in sales):
Payroll Manager/Supervisor: $37,250 – $47,500 (up 3.4% over 2008)

Payroll Clerk: $27,750 – $34,750 (up 3.3% over last year)