By Corey Clacher
As we continue to move further into 2016, the promise of new and complex labor regulation changes mentioned last year – such as the Fair Labor Standards Act (FLSA) are nearing reality. Recently, the Department of Labor (DOL) confirmed that changes to the FLSA, which will increase the salary threshold for many exempt employees immensely, should be finalized by July, 2016. That means that these new regulations could take effect as early as September of this year, disrupting nearly every business in their wake.
With cases of FLSA violations expected to continue rising, it is more important than ever that your clients remain compliant at all times. Employers must protect themselves from potentially crippling penalties due to wage and hour regulation noncompliance. In 2014, companies paid $5.3 million on average to resolve an FLSA violation case1, which can be especially crippling for small and midsized businesses with limited resources.
How can you be certain that your service organization is handling your clients’ wage and hour conditions correctly? According to the Kronos white paper, Complex Labor Regulations Raise the Stakes for Organizations2, here are some of the questions you should review for each client:
- Are their independent contractors classified correctly? Should they be classified as employees?
- Did they provide accurate, up-to-date employee data?
- Are their exempt and nonexempt employees classified correctly? Could nonexempt employees be eligible for overtime?
- How are unapproved overtime practices handled? Are they paying earned overtime correctly?
- Are they tracking meal and rest breaks in accordance with regulations?
- When is work their employees perform off the clock compensable?
If you find yourself answering “no” or are uncertain when answering any of these questions, you may want to look into implementing new automation solutions for timekeeping and scheduling processes in order to minimize your clients’ error-prone manual processes and avoid compliance risk. The Kronos white paper also mentions to look for a solution that delivers centralized wage and hour policy administration, establishes local policy enforcement, and creates detailed audit records.
With the Kronos SaaShr platform, you can rest assured that you’re offering your clients the latest technology, minimizing compliance risk through both centralization and consistency. Because the Kronos SaaShr platform is cloud-based, it’s easy for businesses to adjust to new labor regulation changes in real time without the need to manually update on their end. With the ability to automate pay rules, organizations have the confidence of knowing that employees are being paid correctly and that documented policies are being followed.
The platform also allows businesses to reduce time and attendance policy violations through automation via pay rules. Pay rules automatically determine whether employee breaks should be paid or unpaid. It also applies pay rules directly to the employee’s timecard, so they receive proper credit for overtime hours worked. And because the system records employee punch information in real-time, it allows employers to closely monitor their employee time patterns and verify if the time captured is accurate, avoiding unrestricted timekeeping practices.
With a timeline more firmly set in place by the DOL to enact these labor regulation changes, are you certain that you have the workforce management solution that will keep your clients free from compliance risk? To learn more about the significant impact of upcoming labor regulation changes and how Kronos SaaShr can help your clients avoid compliance risk, download the white paper, “Complex Labor Regulations Raise the Stakes for Organizations” and watch a recorded demo of our human capital management solution in action.
Corey is a Marketing Specialist at Kronos SaaShr, responsible for creating marketing and educational content around Human Capital Management technology along with other responsibilities within the department.
1NERA Economic Consulting, Trends in Wage and Hour Settlements: 2015 Update, found at http://www.nera.com/content/dam/nera/publications/2015/PUB_Wage_and_Hour_Settlements_0715.pdf
2Kronos Incorporated, Complex Labor Regulations Raise the Stakes for Organizations 2015 Edition