HR Advisors Practices Compliance Audits to Support P3 Initiative
The Department of Labor (DOL) is beginning increased enforcement and they expect to generate $7 Billion of additional revenue over the next 10 years.
The DOL’s Goals are to implement the PLAN – PREVENT – PROTECT Program designed to assure that employers regulated by the DOL take responsibility for employment law compliance as Congress requires.
The Regulations will require:
- PLAN – Require employers to prepare a written plan for identifying and remediating risks of legal violations (for example: explain why certain workers are classified as independent contractors)
- PREVENT – Require employers to implement the plan in a manner that prevents legal violations and risks to workers.
- PROTECT – Requires employers to ensure that the plan’s objectives are met – for example: implement a misclassification initiative, including working with the IRS and state labor agencies to target employers who are not classifying workers properly.
What should a company do? – the answer is: AUDIT – AUDIT – AUDIT!!
It’s back to basics. Attorneys Gray and Joseph suggest that you look closely at the following areas:
- Exempt/Non-Exempt classifications
- Independent Contractor Classifications
- Improper Deductions/Docking
- Paying for all “Work” – Bonuses Calculated in Overtime, Travel Time, Waiting Time/On-Call, Working off-the-clock, etc.
The DOL isn’t the only source of challenges – the IRS is also mobilizing to combat misclassification with a National Research Program that will target 6,000 businesses. Targets will be selected at random and will cover five employment tax-related issues:
- Worker Misclassification
- Fringe Benefits
- Officers’ Compensation
- Employee Expense Reimbursements