A single instance of overlooking the law could be enough to get your firm in serious trouble with the federal government. Penalties for failure to comply may include the payment of back wages and can progress to steep fines, prosecution and even jail time for repeat offenders.
Failure to understand and follow the law is no excuse.
Here are some tips to ensure that your company stays in compliance with the law and out of trouble with the government:
Study the law
The U.S. Department of Labor has an extensive database of regulations covering labor laws. If you’re not sure whether you are compliant with how you should be paying temp employees or how you determine full- and part-time status, visit the website at www.dol.gov.
Take the time now to make sure you’re doing the right thing and check in frequently for updates. And work closely with your HR team to make sure your firm stays in compliance, especially if you’re just starting your own staffing agency.
Be diligent about tracking hours worked
The Fair Labor Standards Act requires employers to keep certain records for every nonexempt worker. You need to track when the workweek begins, how many hours are worked each day and each week, and any overtime that has been accrued, among other information.
Don’t put yourself in a position where you don’t know how many hours your employees are working. There are plenty of staffing software options available to help you record hours worked and keep track of valuable temp agency payroll data. Find a staffing software system that works for you and stick to it.
Conduct regular audits
If you’ve implemented what you feel is a good system for tracking hours and complying with federal labor laws, that’s a good start. But you need to remain diligent and conduct regular audits of your firm’s records to make sure they are kept accurately and appropriately.
If you find a situation where someone on your staffing agency team has gotten lazy, remind that person of the importance of accurate recordkeeping. It’s not about trying to punish your employees for not working hard enough. Present compliance to your employees as a way to make sure you’re properly compensating them for the work they have done.
Don’t allow off-the-clock work
One of the most common complaints in labor law violation cases is that employees worked through their lunch break, or came in early or stayed late, and didn’t get compensated for their effort. Make sure your staffing agency enforces breaks and either prohibits employees from working off the clock or be prepared to compensate for that time.
If this is a common problem, work with those employees to see why they are working extra hours. Keep in mind that employees must be paid for time worked, even if they were instructed not to work.
If you’re not sure, pay them
If you find yourself in a situation where you’re not sure if you’ve properly compensated employees for hours worked and you’re waiting on legal guidance, it’s always safer to pay people for the hours they say they worked.
You are never going to face legal action for paying your employees too much. But if you take a hard line and it turns out you were wrong, it could end up costing you.