Posted on May 23rd, 2019
Below is a full transcript of this video.
What’s going on fellow entrepreneurs? John Fagerholm again with Metal Law Group. Today I wanted to discuss EDD audits.
I’m not sure if they’re picking it up in California or not, but I’m starting to get a lot of calls about what to do if there’s an EDD audit.
Well, first thing to do is cooperate fully, because these guys have a lot of power. A lot more power than you would think.
The person that you come into contact with is the one responsible for looking through your documents and deciding if they want to take this first.
I’ve been in situations where I thought my client had some issues, but because of the relationship with the EDD auditor it didn’t turn out to be such a big deal.
And then I’ve had other situations where I thought my client looked pretty good.
But because the auditor and my client didn’t get along for some strange reason it became a bigger problem than it was.
For example, I’ve had one auditor insist in the subpoena that my client show up, which is very rare and very odd. When I asked about it, she indicated that she wanted to ask some follow up questions related to the documents that we had already submitted.
I still thought that was odd so I said, “Well give me your questions and then I’ll ask my client, and we’ll get back to you.” However, my client said, “No, no problem. I’ll show up.”
What I didn’t know is that they had had a phone call previous, before my client ever hired me, and in that phone call it had gotten pretty heated.
And so this auditor was holding a grudge. We show up to the subpoena. We walk into a room and there’s three armed sheriffs in the room. It was absolutely ridiculous.
There was no reason for a sheriff to be in there … or sheriffs to be in there. There wasn’t any reason other than the auditor wanted to show the power that she had.
We walked in there and I said, “Well, this meeting is over because we’re not going to do this here under these circumstances.” And that was that, but it just shows you the type of power that they have. They have a lot of power to determine interpretations of things, when things can go either way. They have the power to accept or reject certain finds.
They have the power to give you discounts, and they have the power to give you payment plans.
My suggestion is always to turn over everything that needs to be turned over.
Put it in a way where you front load the good things and you back-end load maybe some of the things that may be questionable.
And then you’re just polite and respectful, and you do your best to make your arguments and your points when there’s something that could be interpreted either way.
But do it in a way where you’re not going to cause a problem for yourself.
All right people, until next time. See you in the next video. Bye-bye.
