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4 Ways to Strengthen Your Payroll Documentation Compliance

September 8, 2020

Strengthening your payroll compliance is a valuable way to minimize risk to your operation and avoid costly penalties. New regulations and requirements are imposed on farm employers every year so keeping track of them is a time-consuming process. Here are some best practices to help stay aligned with labor laws and minimize expensive risks to your business.

1. Neutralize Security Risks

The amount of time an employer must retain compensation records is 3 years. Best practices recommend 6 years to cover the statute of limitations for any related employee compensation claims. There is an inherent security risk when maintaining records for this amount of time. You should control who has access to the sensitive personal information of your current and past employees to avoid any risk of fraud such as identity theft. 

Performing a self-audit can help verify your data is stored securely and only approved members of the HR team have access to it. Annual self-audits are also a good opportunity to quickly review your company SOPs and ensure proper handling of payroll data during weekly payroll runs.

2. Stay Current On Labor Law Regulation Updates

Labor laws and employee compensation requirements are constantly changing. Staying informed and updating your company policies is necessary to be in compliance with these regulations. Attending industry events that include legal updates is a great way to stay on top of the changes and maintain compliance. In the agriculture industry, events like APMA’s annual forum, AgSafe’s  Activate conference, and CFLCA’s labor forum are good examples where presentations on regulatory updates are available to attendees. An added bonus is that these presentations are provided by industry-leading labor attorneys as well as the governing agencies who enforce the regulations so you are getting the information from the compliance experts.

3. Ensure Accurate Attendance Tracking

Buddy punches & ghost punches are expensive problems for employers. The problem is compounded when the rest of the crew is sharing their production-based compensation (group piece-rate) with an additional person who did not contribute to their efforts. An employer may be forced to deal with the added expense of higher than normal employee turnover that results from dissatisfied employees.

Additionally, there is a compliance risk when considering mandatory training documentation for absent employees. Consider if the employee missed a mandatory safety training on the day they were absent. The company’s training records may potentially be misrepresenting the actual attendance record of the employee. If the employee gets hurt from an accident that was covered in the training, the employer may have a difficult time refuting an expensive claim. Make sure to regularly communicate with your foremen & supervisors about the importance of accurate attendance and the high cost of deviating from company SOPs. There should be open communication in your organization so that all employees feel comfortable sharing when potential issues arise.

4. Automate Data Entry & Record-Keeping

Manual calculations are a common practice among employers who use paper timesheets for tracking employee time & attendance. Even seasoned payroll professional’s are prone to having a few errors once in a while. The manual calculations present an opportunity for mistakes to slip into your operation and cause expensive payroll errors. By automating your time and attendance tracking, you remove the opportunity for any variance in your weekly payroll runs. There are several quality solutions available that integrate directly into your payroll software. These products are collectively called digital labor management software and can solve many of the headaches that burden your payroll team. Not only will a digital system remove the potential payroll errors, it will cut payroll processing time in half and maintain your payroll records digitally without the piles of paperwork. 

HeavyConnect is one of the digital solutions that was designed to be simple and intuitive for field-based foremen & supervisors. When considering ways to strengthen your payroll documentation compliance, using a digital labor management system to capture employee time & attendance is one of the most significant improvements an operation can make.

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