Posted in Blog | Compliance | Leadership

Minimizing Compliance Risk

One of the most underappreciated benefits of a Workforce Management System is the reduction of compliance risk. Compliance is challenging for organizations since requirements grow more complex and numerous each year. In the midst of this complexity, many organizations remain unaware of the requirements and underestimate the cost of noncompliance. According to The Department of Labor, 70% of organizations are in violation in some way. The costs of those violations can be in the tens, even hundreds of thousands of dollars. 

In our experience, these violations often occur when employers create policies to combat what they consider to be time inflation. In many cases, employers do not intend to violate the law, but they think their policies make sense and consider them an appropriate safeguard. If found to be in violation, however, these rationalizations will not suffice.  

Wage and hour requirements must be taken seriously, and appropriate policies must be applied consistently throughout the company. Failure to do so will result in violations. The price of fines, penalties, back-wages, employee morale and productivity will be much, much higher than the inflated payroll costs the organization was trying to control.   

There may be someone in your organization (or a small group of people if you are lucky) familiar with the regulations to which your company must adhere, but how do you ensure that those regulations are being followed in the day-to-day operations of your business? Often these violations are not the malicious acts of a rogue manager, but a lack of understanding of the rules, or decision made “in the heat of battle”.   

A workforce management system provided by a partner familiar with wage and hour requirements can safeguard your organization from the most common violations. This will bring consistency to your organization’s application of wage and hour rules. When supervisors each do their own thing, or managers use faulty decision making, you run the risk of finding your organization in violation. A good Workforce Management System will apply appropriate policies consistently across the organization and will also produce notifications when things happen outside of the norm. This will allow you to address and correct issues when they occur, not allowing them to become patterns leading to more serious violations.  

Wage and hour compliance may be the most important issue facing organizations today, don’t overlook it when evaluating your employee time and attendance processes.  With the Department of Labor allocating more and more resources to finding and punishing offending companies, your organization could be at risk. Education of your management staff and the consistent application of the right policies critical elements in combating this problem. Combining those with Workforce Management Software, supported by a knowledgeable partner, will significantly reduce your risk of violation.     

Have questions? We have answers. Contact our team.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for legal advice. If you have any legal questions regarding this content or related issues, then you should consult with a labor attorney for advice.

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