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SMBs and Enterprise-level companies alike are faced with daily challenges in effectively coordinating and managing their workforces. This whitepaper describes the complexities of regulatory compliance and outlines how to use workforce management technology to avoid potential penalties to your organization.
Whitepaper Reducing Labor Compliance Risks Using Workforce Management to Keep Compliance Under Control Oftentimes, an organization does not seriously consider the complexity of regulatory compliance or its potential impact until it becomes a problem. Complaints to regulatory bodies are more common than perceived, and are usually upheld SumTotal Systems following an investigation. acquired CyberShift Between October 2007 and June 2011, the U.S. Department of Labor collected in 2011 as part of our over $680,000,000 in back wages and assessed over $34,000,000 in civil complete Human Capital Management monetary penalties across 1,634,668 separate case violations. In 2008, it solution. CyberShift was took 97 days on average for the Department of Labor to resolve a regulation the leading provider compliance investigation. About 78 percent of those that included investigations of workforce and of FLSA violations were found to be legitimate and resulted in citations. expense management software and services, These risks to time, capital and reputation are often unintentional and focused on improving easily avoidable. The most common FLSA violation in 2008 was the payment organizational of straight-time pay for overtime hours worked, and similarly large numbers of performance and citations were issued for failure to pay employees for all hours worked. profitability. CyberShift’s products are part The Global Picture of SumTotal’s fully Globally, the situation is more complex; modern organizations need to consider supported core pillars. international standards in addition to the multitude of local and national laws in any number of countries. In the U.K., for example, while employers are permitted to ask employees returning from sick leave to provide proof of fitness to return to work, they are required to ask for a Statement of Fitness to Work for any sick leave period that exceeds seven days. Whether such “doctor’s notes” are company policy or national law, SumTotal Workforce Management, formerly CyberShift Workforce Management 3G, can help your organization collect and organize such documentation through a robust absence management system that allows employees and supervisors to The most common attach files directly to absence requests. FLSA violation Wage regulations vary widely from market to market as well. Even minimum wage in 2008 was requirements, which seem simple at first glance, can become quite complex for the payment of the global-minded manager. For example, in the U.S., most employees are straight-time pay entitled to at least the one national minimum wage, with some notable exceptions for overtime hours (e.g. waiters’ tips do contribute), while in the U.K., there are four minimum worked. wages based on age, with tips are not counted toward the minimum. SumTotal — Source: The U.S. Workforce Management can rein these complications in with a Time & Attendance Department of Labor system that allows multiple levels of rate configuration, set by employee, date, work type and more, like proving rate premiums based on time of day. www.sumtotalsystems.com 1 Reducing Labor Compliance Risks: Using Workforce Management to Keep Compliance Under Control And in all markets, even those with less strict regulations, employers must maintain labor standards consistent with their own internal ideals, or they risk damaging public perception, employee morale and relations with increasingly global trade unions, consumers and business partners. Managing Your Workforce to Reduce Risk Using a robust Workforce Management solution, an organization can reduce the risk of compliance violations, maintain morale and stay responsive to any compliance issues that do arise. SumTotal Workforce Management helps ensure that the organization stays within regulatory compliance by managing and tracking break times, pay rules, overtime and approvals. Using a combination of employee sign-off and supervisor approvals keeps everyone informed whenever any changes are made, ensuring that any inconsistencies are resolved before the records are even sent to payroll. And there is no need to leave anything to chance; SumTotal Workforce Management helps ensure that organizations faced with regulatory complaints have accurate historical records to properly and promptly respond with the necessary data. Consistency and Automation Even basic automation and record keeping would help prevent many of the inaccuracies that lead to the most common regulatory violations, such as failure to pay overtime or pay for all hours worked. The ability to report on scheduled time, worked time and breaks helps organizations stay within compliance consistently by identifying issues before they become problematic. SumTotal Workforce Management helps organizations stay within regulatory compliance by facilitating the following tasks: ■ Tracking meal and break times, and reporting on any exceptions ■ Regulating and tracking overtime pay ■ Employee- and supervisor-level approvals ■ Managing and reporting on scheduled work time ■ Managing and reporting on actual work time ■ Pay rule management Accurate Records Most regulatory compliance complaints are resolved in favor of the reporter. Proper record keeping and audit history, such as those offered by SumTotal Workforce Management, equip organizations with the tools they need to recognize issues early and defend themselves against invalid complaints. SumTotal Workforce Management helps organizations respond to disputes with historical record keeping, audit histories and reporting tools that make it easy to organize all available information. Employee sign-off and supervisor approvals help prevent record inaccuracies and incorrect payments by ensuring that all relevant parties verify the accuracy of recorded work time, and alerting those involved when any changes are made www.sumtotalsystems.com 2 Reducing Labor Compliance Risks: Using Workforce Management to Keep Compliance Under Control to previously approved time. By keeping employees involved in the approval process, organizations will not only reduce risk, but increase transparency and maintain employee morale. SumTotal Workforce Management also helps organizations maintain employee “Implementing the SumTotal information required by regulations such as the FLSA: Workforce Management solution has enabled us ■ Name, Address, Gender and Occupation to better manage our ■ Pay rules workforce, reduce costs and empower City employees to ■ Pay rate be more productive. We can ■ Hours worked each week, including overtime forecast staffing issues, track by shift, uncover trends, and ■ Additions to or deductions from the employee’s wages take a proactive approach each week in managing our workforce Addressing These Challenges – all of which contributes to maintaining and improving SumTotal Workforce Management helps optimize an organization’s labor service levels for the compliance by encouraging and maintaining automation, one-time configuration, residents of High Point.” direct employee involvement, high employee morale and accurate record keeping. Wherever an organization’s employees live and work, labor compliance —Tom Spencer Systems Project is a growing concern, and SumTotal Workforce Management can help you keep Administrator, City it under control with the following: of High Point ■ Configuration – Manage employee information, pay rules and default schedules by groups or individually to ensure accuracy and consistency across the workforce. ■ Automation – With most standard processes occurring automatically, employees and managers need only address exceptions…less time at the timesheet means more time on the job. ■ Accuracy – Historical records for all employees’ work and break times, change auditing and approvals at both employee and supervisor levels help ensure the accuracy of all recorded time. ■ Reporting – Easy access to the information you need organized, as you need it, makes it easy to identify and call out issues before any problems actually arise. SMBs and Enterprise-level companies alike are faced with daily challenges in effectively coordinating and managing their workforces. SumTotal Systems has experience in supplying workforce solutions across all industries, many of which face some type of compliance regulation. Tapping into our resources will give you a greater opportunity to use yours and avoid possible penalties. www.sumtotalsystems.com 3 Reducing Labor Compliance Risks: Using Workforce Management to Keep Compliance Under Control More Information For more information, send an email to firstname.lastname@example.org About SumTotal SumTotal Systems, Inc. is the global leader of strategic Human Capital Management (HCM) solutions that provide organizations with a new level of visibility to help make more informed business decisions and accelerate growth. Recognized by industry analysts as the most complete solution, SumTotal provides full employee lifecycle management, including a core system of record, from a single provider for improved business intelligence. The company offers customers of all sizes and industries the most flexibility and choice with multiple purchase, configuration, and deployment options. We have increased the performance of the world’s largest organizations including Sony Electronics (NYSE: SNE), AstraZeneca (NYSE: AZN [ADR]; London: AZN), Amway (KUL:AMWAY), Seagate (NYSE: STX), Dell (NASDAQ:DELL), and Google (NASDAQ:GOOG). For more information, or to request a demo, please call +1 (866) 768-6825 (US / Canada), +1 (352) 264-2800 (international) or visit www.sumtotalsystems.com Corporate Headquarters EMEA APAC SumTotal Systems, Inc. SumTotal Systems, UK SumTotal Systems India Pvt. Ltd. © 2012 SumTotal Systems, Inc. All rights reserved. SumTotal, and the SumTotal 2850 NW 43rd Street 59-60 Thames Street 7th Floor Maximus Towers logo, are registered trademarks or trademarks of SumTotal Systems, Inc. and/or Suite #200 Windsor, Berkshire Building 2B, Mind Space its affiliates in the United States and/or other countries. Other names may be Gainesville, FL 32606 USA United Kingdom, SL4 1TX Raheja IT Park, Cyberabad trademarks of their respective owners. 12_0125LS Phone: +1 352 264 2800 Phone: +44 (0) 1753 211 900 Hyderabad, AP-500081, India Fax: +1 352 264 2801 Fax: +44 (0) 1753 211 901 Phone: +91 (0) 40 6695 0000 Fax: +91 (0) 40 2311 2727 www.sumtotalsystems.com 4
"Reducing Labor Compliance Risks"