Mitigating the Risks of Time and Attendance Non-Compliance Within Your Organization
Labor laws worldwide mandate employment policies where every employee is entitled to vacations, time-offs, and overtime pay. The laws vary from region to region and the onus of compliance falls on employers. Every business — big or small — needs to ensure that their employees get paid for overtime, take their full meal breaks, get paid for rest periods, and work for the stipulated number of hours as required by federal and state laws.
The cost of time and attendance non-compliance is huge. If employers fail to prove compliance, they are at risk of class-action lawsuits and face wage theft allegations along with other fines and penalties. Furthermore, it negatively impacts workforce morale, recruiting efforts, and the company’s brand.
Most multi-location, global businesses are well aware of the challenges of compliance and the risks of non-compliance. This is why forward-thinking companies automate their time management and compliance processes and prevent disasters. With the right time and attendance solution, you can implement and track labor compliance requirements while keeping up with ever-evolving compliance and policy norms. You can even ensure compliance with union rules, collective bargaining, and enterprise agreements.
Replicon’s cloud-based Time and Attendance software with its built-in compliance library and dashboard capabilities enables organizations to better comply with today’s complex laws and regulations and provides fool-proof audit trails that meet any regulatory compliance or audit challenges.
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Mitigating the risks of time and attendance non-compliance within your organization is essential. With over 20 years of experience in the time and attendance industry, we have solved every use case around time and have built a solution that eliminates compliance risks.
In this blog, we are sharing how you can reduce compliance risk with these best practices.
Access Attendance Information for Payroll Processing
Accurate payroll processing is an integral part of time and attendance compliance. When the payroll teams don’t have easy and complete access to employee time data, there will be late payments, underpayments, overpayments, and pay corrections — increasing financial liabilities and compliance risks. When businesses use disparate solutions for attendance and payroll processing, manual data entries induce more errors. According to American Payroll Association (APA), manual tracking and processing of time data introduce anywhere between 1–8 percent human errors, directly affecting an organization’s payroll. This is a major compliance risk. Every year the U.S. Department of Labor (DoL) recovers several hundred thousand dollars of back wages for overtime violations.
What’s needed? A single source truth for time and attendance data that seamlessly integrates with a payroll system to streamline the automatic import of data. This enables accurate employee payouts. With our preconfigured global pay rule library, you can apply overtime, meal breaks, and other labor laws without any human intervention. The pay calculations are fully automated and data gets pushed to your desired payroll system for further processing. Since all the data is stored in the cloud, up-to-date information is always available for all verification purposes.
Manage Global Employee Pay Rules and Leave Laws in One Place
The growing remote and hybrid work environment has opened up a huge opportunity for businesses to hire and manage talent globally. This also means that employers need to comply with various federal and state statutes for pay rules and leave of absence. Organizations need to comply with varying overtime, time off, and other considerations, including meal breaks, rounding rules, premiums, and additional union rules. For instance, Canada requires employers to pay 1.5 times the standard pay for more than 40 hours worked per week. In Sweden, employers have to pay 1.5–2 times the standard pay. The variations can be seen in the leave policies as well. The national minimum leave entitlement in Canada is 14 days for every year of employment, but the annual statutory minimum leave in the UK is 28 days per year. Also, there are laws governing how these leaves can be accrued and paid out.
Employers need the ability in a time and attendance software to configure timesheets for specific types of employees — full-time hourly, part-time salaried, and contractor — to ensure each employee type gets their fair share of payroll and mandatory breaks. Employers should also set timesheet rules to mark an employee absent, late, early out, or early in, based on the times they punch in and out. Every time there is a violation of any rule, managers or supervisors need to be immediately notified to take necessary action. To manage overtime cases, create overtime policies to automate the application of local, province, state, or country-specific overtime rules at the department, group, or individual employee level. Automating all pay calculations based on the number of overtime hours worked will also aid in saving time and mitigating risks.
Replicon’s Time and Attendance solution supports global, multi-location businesses dealing with a wide range of variation in local policies. The pre-built validation rules keep current with changing laws with automatic updates from the compliance portal. Employers can even add custom validation rules to apply limits or checks — like maximum thresholds on the number of leaves pay period — to enforce their internal policies. These validation rules help to eradicate costly, time-consuming backtracking investigations to find the source of those errors.
Optimize Workforce Planning
Leave planning is important to prevent the overlapping of leaves of multiple team members in the same period. Advance leave planning gives managers and supervisors the time to create an alternate arrangement, rather than having to scramble and risk getting caught short. Without proper leave planning, team members will be forced to work extra hours to complete a job or project within the set deadlines and budget. When not monitored, this practice can pose a compliance risk.
With a time and attendance software, organizations can enable employees to plan their leaves well in advance while adhering to business policies. Employees can request vacation, sick leave, or any other time off from anywhere and anytime. The self-service capability enables employees to check balance leaves, accrued time offs, and expiring leaves before they book their time-off request. Supervisors and managers can see the used leaves, balance leaves, and team calendar to ensure that the time-off request meets the business policies and the team is adequately staffed.
Replicon Helps Organizations Stay Compliant, Always
Replicon’s Time and Attendance software helps organizations of all sizes to better comply with ever-evolving complex laws and regulations. Automated processes assist businesses to track time accurately, reduce errors, improve financial reporting accuracy, and manage compliance risks with an audit trail that is easily available to meet any regulatory compliance or audit challenges.
More than 2,500 global businesses trust Replicon to manage their enterprise time and stay in compliance. Check out our case studies to discover the different ways our customers have benefited from using Replicon.