Record retention for HR professionals can be a very daunting and time consuming task. If an organization fails to stay in compliance with human resource record retention requirements, it can be subject to litigation and penalties.
The table below highlights each major hr related law and their respective retention requirements.
In our last post, Building a Business Case to Purchase an HRIS (Part 1), we covered the first main reason to purchase an HRIS – elimination of costly errors.
In Part 2, we’ll be talking about Compliance.
Compliance is a hot topic nowadays. It isn’t necessary to be willfully negligent to be confronted with serious and very expensive problems. Even the most compliance conscientious employer who meets the variant interpretations of specific regulations may encounter unexpected litigation and find their efforts fruitless. Many companies presume that they are adhering to strict regulation guidelines when in fact they’re at fault for violating a compliance specification located somewhere in the fine print.\
For instance, an average of 450 employment lawsuits are filed in the U.S. each day, and 57% of companies have been named as defendants in at least one employment related lawsuit in the past five years. A simple google search of the term “employment lawsuits” results in over 17 million results. Lawsuits by disgruntled employees are one problem. But nowadays, a company can face suits from candidates who were never hired, as well as from former employees months after termination.
Compliance with federal and state regulations involves a mind-boggling array of topics, most of which fall within the purview of the HR department. OSHA, FLSA, COBRA, EEO, VETS, SOX, and EDA all have minutely detailed requirements, many of which are open to individual interpretation, and they all have severe penalties for infraction. It is a never-ending, full-time task to keep up with these requirements, ensure corporate compliance, and follow the required reporting procedures. Human error is seldom seen as an acceptable defense in cases of compliance infraction.
Compliance automation plays a critical role in both preventing violations by ensuring that requirements are automatically monitored and fulfilled, and in defending alleged compliance violations. The best defense against an alleged violation is a watertight reporting system and automatic documentation of everything related to a specific case.
For example, in a case of proving OSHA compliance, an updated, organized on-line injury reporting system in the factory is going to carry more weight than the standard illegible notebook. In addition, some compliance authorities, such as VETS-100 and COBRA will waive strict reporting requirements if it can be proved that appropriate data collection and tracking systems are being used.
Ascentis HR can reduce the likelihood of error as well as reduce the workload for HR staff in collecting such compliance information by providing compliance automation. The powerful report wizard can quickly generate reports such as EEO-1, VETS-100 and OSHA incidents reducing time spent on generating these reports as well as covering any liabilities in case of lawsuit.
Curious about how to make your company more compliant? Ask for more information by filling out this form or call Ascentis at 800.229.2713.
When considering automating payroll and time and attendance, many employers balk when they ask themselves how much the system will cost to implement. In the current regulatory enforcement-focused and litigious business environment, the answer may be entirely pragmatic: how much money do you not want to pay in a wage and hour investigation or lawsuit?
The American Payroll Association (APA) perrformed a study in the early part of the last decade that has become a benchmark for return on investment estimates when automating payroll and time and attendance systems.
The APA study found that employee time theft, where employees clock in late, clock out early and take long lunches and breaks, averages 10 minutes per employee per day; payroll personnel take 5–6 minutes to reconcile and calculate each time card each pay period; human error costs 1%–8% of total annual gross payroll. Using these three statistics, a Washington Business Journal article estimated the annual savings of automating the payroll process for a 25 employee company that paid an average wage of $10 per hour amounted to $8,400.
A different study estimated that the cost of unearned paid time off (PTO) averaged a conservative estimate of half a day per employee per year. Unearned PTO occurs when employees take advantage of manual time off tracking systems to take time off they haven’t earned.
Combining this fact with the APA’s findings and assuming full-time work with no overtime, employers who use manual payroll processes may pay an estimated additional 3.4% in effective wages to each non-exempt employee compared with their raw hourly wage rate. So, an employee earning federal minimum wage of $7.25 per hour could effectively cost an employer $7.50 per hour.
These raw estimates make a very effective case for automating payroll and time and attendance. Once implemented, the savings compound. (See how much by using this webapp.) Employers get back most of the 5–6 minutes per timecard per pay period, which gives time back to payroll and HR to focus on other strategic initiatives that save more time and increase productivity.
Now more than ever, it’s crucial that employers maintain meticulous recruiting records.
Employment discrimination lawsuits are on the rise, and the government has increased its monitoring and enforcement of compliance issues with companies that work with federal contracts. If you get audited and don’t have the ability to quickly and easily produce the required compliance documentation, you could experience substantial disruption in your business, possibly resulting in fines or other damages.
Just Google “Hiring Practice Lawsuit News”, and you’ll find hundreds of articles related to companies being sued for unfair or unlawful hiring practices, many of which may have resulted from failure to comply with EEOC regulations. Human Resource managers and hiring managers have enough on their plate without having to also be well-versed in every aspect of EEOC regulations, which is why having an applicant tracking system is such a critical investment for any company.
Recruiters, hiring managers and human resources departments are under constant pressure to fill critical positions with the right people as quickly as possible, and that’s where time and resources should be invested – not in worrying about compliance. But if you source candidates from various outlets, such as Internet job boards, social media and recruiting agencies, the risks that arise from poor recordkeeping grows on a daily basis.
Ascentis Recruiting applicant tracking system can protect you from compliance violations by collecting, warehousing and reporting on the records you will need to produce if you are audited. Ascentis Recruiting supports:
In addition, Ascentis Recruiting provides intelligence that will help you move beyond basic compliance management by delivering data that supports better business processes, such as:
And because Ascentis Recruiting integrates with Ascentis HRIS and other systems, recruiting and onboarding data can be parsed to your core HR database and automatically and accurately shared with your payroll, self-service and timekeeping systems.
Watch our archived Ascentis Recruiting webinar today to learn more about Ascentis Recruiting, or fill out an online demo request form. We’d be happy to answer all of your questions around hiring practice compliance and automating your most critical HR and payroll processes with easy-to-use Ascentis software solutions.