Mailer - HR Compliance ThumbnailFrom employment law to benefit requirements to employee pay provisions, maintaining employer compliance is no easy feat. It’s time to sharpen your compliance focus! Get the facts on how to comply with top HR regulatory issues.  

 

Are You Prepared for these Top 4 Compliance Issues?

From employment law to benefit requirements to employee pay provisions, maintaining employer compliance is no easy feat. Surviving in today’s regulatory environment requires agility and the ability to keep up with the rapidly changing compliance world.

In 2016, agency and elected officials are focused on income inequality and the lack of wage growth. This year’s top compliance issues reflect these priorities, compelling organizations to evaluate and adjust their HR practices. The key to compliance success for 2016 and beyond will be having accurate data, efficient processes, and most importantly, streamlined technology.

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“Maintaining compliance is a never-ending challenge, but it doesn’t have to encompass all of HR’s time and resources. With the right technology at their fingertips, organizations can take the guesswork and stress out of compliance,” said Jayson Saba, vice president of market strategy at Ceridian.

2016 HR Compliance Priorities

Read on for insight into this year’s top compliance priorities and for tips on how to meet the current regulatory requirements.

Affordable Care Act

The Facts: In 2016, two new Affordable Care Act (ACA) provisions went into effect:

  1. Organizations with 50-99 full-time equivalent employees must offer full-time employees who work an average of at least 30 hours per week minimum essential health coverage that is affordable and provides minimum value. (This provision went into effect for employees with 100 or more full-time equivalent employees in 2015.)
  2. Employers must begin reporting employer-sponsored coverage information to employees and the IRS. In December, the IRS extended the reporting deadline, giving organizations more time to meet this complex reporting requirement.   

For more detail information about ACA compliance requirements, read our article ACA Snapshot: 3 Focus Areas for 2016.

Action Steps: To effectively comply with ACA requirements, ensure that your organization has HCM technology in place to:

  • Automate the collection and organization of employees’ health care coverage data
  • Transition new hires from the initial measurement period to the measurement period of ongoing employees
  • Flexibly and accurately perform average hour calculations

Employee Misclassification

The Facts: The government is focusing on identifying organizations that mistakenly or intentionally classify individuals as contractors when they should be categorized as employees. In 2016, the U.S. Department of Labor (DOL), in partnership with the Internal Revenue Service (IRS), is working to stop the growing trend of misclassifying employees.

Action Steps: Verify that you are correctly classifying independent contractors by examining the relationship between your organization and these workers:

  • Are you using a workforce management solution to schedule the worker?
  • Does the worker manage other employees?
  • Do you track the worker’s performance in a system?
  • Do you pay the worker an hourly rate and overtime? Do you provide them benefits?

Answering yes to any of the questions above may indicate that the worker should be classified as an employee, not a contractor. In addition, be sure to review the U.S. Department of Labor’s economic realities test, which outlines how to properly classify employees.

A HCM solution like Dayforce HCM can help you clearly define workers’ roles in the organization and help you correctly classify employees.

Overtime

The Facts: Currently, administrative and professional employees who earn a salary of at least $455 a week, or $23,660 a year, are exempt from overtime pay under the Fair Labor Standards Act (FLSA). Proposed changes to the FLSA regulations would increase the current threshold to $921 a week, or $50,440 a year.

Action Steps: Prepare for the proposed changes to the FLSA regulations by taking the following steps:

  • Ensure you have an easy-to-use timekeeping solution in place for tracking overtime hours
  • Conduct an analysis of your workforce to determine which employees may be impacted by the proposed FLSA regulations
  • Implement a HCM solution that accurately tracks employee hours and the type of work performed. This will help your organization understand the impact of reallocating staff and responsibilities in adherence to FLSA overtime regulation parameters

Minimum Wage

The Facts: While the federal minimum wage has not changed, as many as 15 states increased their minimum wage at the end of 2015 or plan to do so in 2016.

Action Steps: Avoid minimum wage violations by correctly tracking employee information. Be sure you have systems and technology in place to:

  • Analyze your workforce by employee address, work location and pay type (hourly vs. salary)
  • Seamlessly adjust payroll information, overtime pay rates and employee exemptions from overtime requirements
  • Assess the impact of proposed changes, including its implications for payroll taxes, pay structure and the organization’s budget

As government and elected officials focus their attention on labor laws, your organization must be prepared to handle upcoming compliance changes. A comprehensive HCM solution will give you visibility into your workforce and equip you with the technology to adapt to ever-changing regulatory requirements.

For more information:

  • Read the eBook Compliance – Don’t Guess, KNOW
  • Visit the Ceridian Compliance Center
  • Learn more about Dayforce HCM