Four Approaches to Managing the Impact of the DOL Overtime Rule Changes

To comply with the Department of Labor’s overtime legislation, all employers must decide whether their salaried employees will be exempt or non-exempt from overtime by December 1^st of this year.  The DOL predicts the new regulation will cost private employers in the neighborhood of $1.8 billion in 2017.

There are four basic scenarios that employees will encounter in the coming months:

1. They will be paid the exempt base salary of at least $47,476 per year
2. They will be reclassified as an hourly employee and eligible for overtime compensation
3. They will be kept at their current salary level and payed for any overtime hours
4. Their typical overtime hours will be factored into a 40-hour work week to convert their current salary base into an hourly wage

Although these four scenarios differ greatly from one another, employers can navigate each one of them effectively if they follow the corresponding four phase engagement process.

Phase I – Employee Reclassification Checklist

1. Initiate a formal review of job descriptions to confirm exempt or non-exempt status
2. Review employee benefits, eligibility, and plan design
3. Retool employee handbook and policies (meal breaks, overtime, working from home, etc.)
4. Analyze workload  and overtime alert procedures to minimize overtime exposure
5. Firm-up hours, tracking expectations, and engagement goals for exempt supervisors
6. Restructure commission and non-discretionary bonus impact (only 10% qualify as salary)

Phase II – Employee Perception

1. Foresee various reactions from employees
2. Acknowledge that some employees will see this as a demotion, while others will see it as beneficial
3. Combat the negative stigma that comes with being salaried and then having to track hours
4. Anticipate negative employee feelings and determine how the employees, who have converted to hourly, fit within the new structure

Phase III – Employer Messaging

1. Propose an introductory meeting prior to December 1^st to notify employees of impending changes
2. Address the group as a whole concerning fairness and equality issues
3. Encourage follow-up communications and be prepared for informal employee inquiries
4. Issue the new policy with an updated employee handbook
5. Sample pay-stub layout for each affected employee
6. Reinforce employee value to company operations, explain rule is mandated by federal law
7. Update Job Description and Employee Acknowledgment signature

Phase IV – Employer Opportunity

1. Increase employee transparency with hours tracking
2. Improve performance reviews, productivity, and job cost
3. Minimize the risk of missing important issues that typically come to light for hourly employees

Although there is a lot of negative buzz concerning The DOL’s new overtime legislation, there is potential upside for employers. The DOL has prompted the need for a formal reset of how time is tracked and how jobs get done. If employers are able to comply with this legislation and minimize employee unrest simultaneously, they will be able to increase productivity and augment their bottom-line.

If you have any questions about this new overtime legislation or would like to talk with an expert to learn how Mosaic can help you navigate it successfully, call (303) 645-4270 or visit www.mosaices.com.

       

The Growing Cost of Ever-Increasing Benefits Administration Complexity

Health insurance premiums are expected to continue to increase:

• 77% of employers expect the Affordable Care Act will increase their company's health care costs dramatically
• 2017 premium increases are projected to be the largest in recent history (InternationalFoundation Survey)

Benefits administration complexities and increasing premiums are elevating the risk that your benefits cost will rise faster than the rate of overall premium growth.  To avoid this risk, you must carefully manage your employee benefits.  

Inaccurate or missed premium deductions are expensive, but fixable.  Understanding the causes of increasing benefits cost is half the battle.  Some of the most common causes include:  

• Competing payroll timetables vs. carrier cut-off dates and retroactive limits
• Challenges recovering lost premium dollars after the fact
• On-going age-banded rate adjustments
• Carrier customer service challenges (poor communication and follow-up)
• Numerous carrier invoice delivery methods (electronic and paper), including confusing self-bill invoices
• Inefficient, outdated, and inaccurate carrier technologies
• Matching plan premiums with employee pre- and post-tax deductions
• Competing demands of payroll and carrier invoice deadlines
• Post open-enrollment and renewal invoice confusion

Mosaic HR Services delivers customized solutions that save you time, increase accuracy, and manage your premium costs.  Our benefits administration solutions are designed to complement your benefit administration strategy. To learn more and to see how Mosaic HR Services' benefits administration service can help, visit www.mosaices.com/mosaic-hr or talk with an expert at (303) 645-4270.  

The Power of a Single-Platform HCM System

Organizations are quickly moving away from disparate workforce management systems that attempt to share data through integrations that are slow and unreliable.  The best Human Capital Management systems are those that house Human Resources Information Systems, Payroll, and Time and Labor Management functionality on a single-platform with a single database and a single user interface.  Integration between disparate systems is not only inefficient, it is becoming impractical in today's complex employment environment.  A single-platform HCM system is now the industry standard for managing your workforce.  

Benefits of a single-platform HCM solution:  

• Electronic Forms - Deploy your forms and allow employees to complete and sign them electronically.  Schedule forms for completion and the system will manage employee compliance.  Save the forms in the system for easy retrieval from any functional area of the platform.  
• HR Actions - Automate process and activities so that the software guides employees through the process.  Automatically update payroll when HR actions change benefits or payroll information.  
• Workflows - Processes that require the involvement of multiple people, including approvals, can be automatically directed by the software using the workflows that match your requirements.  Workflows can be implemented for electronic forms, HR actions, applicant tracking, employee onboarding, and other processes you want to automate.  
• Applicant Tracking - Candidates can view your job openings and apply directly through your platform and track their progress to hire.  When an applicant is hired, you can automatically make the applicant an employee without migrating, or worse, manually entering employee data captured during the application process.
• Onboarding - When an applicant is hired, the employee can review and electronically sign forms directly within the system and be immediately activated as a hired employee.  Tasks can be assigned to other employees to provision the new hire's work environment.  
• Performance Management - Manage your employee review process natively within the system.  
• Other areas of an all-encompassing HCM platform:  
• Training and Certification Tracking
• Asset Management
• Online Benefits Enrollment and EDI Carrier Feeds
• Workers Compensation Tracking
• FMLA
• Turnover, Job History, and Position Management
• Skills, Education, and Credentials Tracking
• Compensation Management

Single-platform HCM systems are imperative to comply and thrive in an employment landscape that is increasingly complex.  To learn more and to see how Mosaic's Workforce One platform can help, visit www.mosaices.com or talk with an expert at (303) 645-4270.  

The Ugly Truth about Affordable Care Act Compliance

Many employers do not have the systems in place to support efficient compliance with the Affordable Care Act (ACA).  Deploying the right solution is critical given the requirement that 1095-C forms need to be delivered to employees by January 31^st.  The ugly truth of ACA compliance is that it will remain painful for employers until they embrace technology that can make compliance truly efficient and accurate.

An efficient solution for ACA compliance must have four core capabilities:

1. Track the data necessary for reporting compliance:

• Group health premiums, coverage dates and, for self-funded plans, dependent information
• Compensation data (payroll)
• Time (hours worked)

2. Aggregate the data:

• If the required data lives in disparate systems (Human Resources, Payroll, Benefits, and Time Keeping) it must be aggregated to present a clear, timely, and accurate picture of ACA status in real time.  Aggregating this data is hard enough to do at the end of the year, not to mention continuously to support real-time decision making
• If employers are members of a control group (related employers that consist of more than one legal entity), data must be aggregated for the entire control group

3. Measure and analyze the data to support real-time decision making throughout the year:

• Alert the employer when employees attain or lose coverage eligibility
• Understand affordability to avoid substantial penalties for not offering affordable coverage

4. Report the required data to employees and the IRS each January for the preceding year:

• Self-insured plans must complete Section III of the 1095-C form and therefore must track and report dependent information
• Large employers (250 or more employees) must report data to the IRS electronically using the IRS AIR reporting system

Can your technology efficiently deliver on the requirements of the ACA during the 31 days of January?

Mosaic’s Workforce One platform is uniquely positioned to address ACA compliance.  Workforce One is a comprehensive workforce management system that has the Human Resources, Payroll, Benefits, and Time Keeping capabilities the ACA requires – all delivered on a single database with a single user- interface.  

If you would like to see how Workforce One can take the ugly out of ACA compliance, call (303) 645-4270 or visit www.mosaices.com.

The Trend Towards the Cloud Continues

It’s easy to forget that companies are still using on-premise solutions when you see cloud adoption rates over the past few years. In fact, according to Gartner, the traditional deployment model for on-premises software is expected to significantly shrink from 34 percent today to 18 percent by 2017. With this data, we can assume that 82 percent of all software deployments will be in the cloud in the next two years. And if you’re not providing a SaaS-based solution, you’re limiting your company to a fraction of the sales you could be generating.

We’re in the midst of something of a computing revolution. It’s comparable to how products were built and distributed prior to the industrial revolution versus after the industrial revolution. The cloud is continually a topic across the internet and it will not be losing traction anytime soon.

Cloud is constantly being covered as a trend – especially in the small and midsize business (SMB) space. But why?

Because it’s simple.

When we look at cloud vs. on-premise solutions, there are a number of reasons leveraging a cloud, or more specifically software as a service (SaaS), based solution is much easier not only for SMBs, but larger organizations as well.

Here are 7 reasons why cloud-based solutions are helping businesses thrive and how they will continue to do so into the future:

1. Upfront costs are minimal.
   • Outside of an implementation fee, there’s nothing to pay for upfront. SaaS uses the same model as your electric company or cable provider – it’s simply a month-to-month payment for the service you provide, which typically allows customers to cancel at any time. The perpetual license constraints no longer have to be a problem or risk for your prospects.
2. Installation isn’t necessary.
   • Leveraging a new solution no longer has to be the major undertaking it was in the past for customers. As a result, leveraging a new solution can provide an incredibly short time to value for the customer, allowing ROI to be realized much faster.
3. Hardware doesn’t exist.
   • Unless we’re talking about employees clocking in and out on a computer or a time clock, the need for hardware no longer exits. The entire solution is accessible on the web via a browser.
4. Maintenance isn’t required.
   • Security, reliability, availability, performance, and infrastructure, oh my! These don’t have to consume your thoughts and create that stress knot in your back anymore. They’re all covered by the service-level agreement (SLA) guaranteed by the vendor you partner with.
5. Data backups are no longer your problem.
   • The risk of data loss is mitigated with SaaS. With an on-premise solution, if your location was hit by a natural disaster and flooded for instance, the businesses solutions would be inoperable. With SaaS your data is always accessible from anywhere at any time, and if the vendor’s data center is taken down, you can confirm with the SLA that there is a warm standby facility ready to go that mirrors your and your customers’ data.
6. Upgrades are automatic… and free! 
   • Upgrades to the software simply happen with SaaS. You’ll see new features as they’re released typically every one to three months. There’s nothing your IT team needs to do in order to make them available. And the pay-as-you-go model mentioned above means that you’re already paying for you and your customers to get access to the latest and greatest version of the software – there’s no additional cost.
7. IT resources can focus on other initiatives.
   • With the vendor taking care of the software, support, and troubleshooting for you, your IT resources are suddenly freed up to focus more on high-value activities and work on the greater strategy of technology and the role it plays in your and your customers’ businesses.

The cloud and, more specifically, SaaS helps organizations of all sizes to operate more efficiently. Check out more information here or consult an expert at 303-645-4270. 

Health Coverage Information Reporting Deadlines for Applicable Large Employers are Approaching

Who Must Report?

As a governmental, Tribal, tax-exempt or for-profit employer, if you are an applicable large employer you are subject to the Affordable Care Act information reporting requirements. These requirements apply to you whether or not you offered health coverage to your employees.

You are an applicable large employer for 2015 if you had 50 or more full-time employees, including full-time equivalent employees, in 2014.

What Must You Report?

If you were an applicable large employer in 2015, you must file information returns with the IRS and provide statements to each employee who was a full-time employee for at least one month of the year about health coverage you offered or to show that you did not offer health coverage.

What Forms Must Be Used To Report?

Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Return: used to report to the IRS summary information for each employer and to transmit Forms 1095-C to the IRS.
Form 1095-C, Employer-Provided Health Insurance Offer and Coverage: used to report required information to your employees and to report information about each employee to the IRS.

What Are The Due Dates For Reporting?

Forms 1095-C must be provided to your employees by February 1, 2016.
Forms 1094-C and 1095-C are due to the IRS by February 29, 2016, if filing on paper, or March 31, 2016, if filing electronically.

More Information

For more information, visit our page about what our ACA manager can do for you or give us a call at 303-645-4270.

Also, make sure to check out the questions and answers about Reporting of Offers of Health Insurance Coverage by Employers on IRS.gov/aca.

Helping Businesses Manage Overtime Costs in the Wake of FLSA Changes

You’ve likely heard a lot in recent news about the Department of Labor’s (DOL) proposed regulations that are expected to affect the Fair Labor Standards Act (FLSA) regarding new white-collar exemptions in the near future.

With minimal revisions since the FLSA was enacted almost 80 years ago, significant adjustments regarding overtime pay and minimum wage requirements have been proposed by the DOL. The DOL has proposed these updated regulations to better align with the present-day workforce and economic climate.

To put things into perspective, the current FLSA requirement states that an employee that makes at least $455 per week ($23,660 per year) either hourly or salary and who meet a duties requirement test is considered “exempt”. These exempt employees do not qualify for overtime pay. If passed, the DOL’s new regulations would require that:

• The minimum salary threshold to be $970 per week ($50,440 per year) in order to be considered exempt from receiving overtime pay.
• The salary threshold be updated annually to stay level with rising inflation and wage costs.

These new regulations would undoubtedly have a significant impact on most US businesses within the coming months. It would require employers to reassess their entire workforce classification as exempt/non-exempt, increase minimum annual wages of exempt employees, and track all hours worked by non-exempt employees. As a service provider, it is critical that you help to guide these businesses during these potential changes. By providing your expertise in conjunction with a workforce management solution, you can help your clients keep in compliance with the new FLSA regulations and control overtime costs.

You can reduce a business’ compliance risk and overtime costs by offering them a workforce management solution, complete with Time and Attendance, that accurately tracks and documents all employee hours worked, delivers proactive alerts that notify employers of employees breaching overtime, and includes insightful reporting capabilities for both ongoing analysis and proof of compliance.

In this recorded webinar, held on August 20, 2015, by ChrysMarie Suby of the Labor Management Institute and titled “Overtime Best Practices”, you’ll learn 10 helpful strategies to bring to employers for minimizing their overtime costs.

1. Define the department budget and address OT in hours & percent of Total Worked hours.
2. Identify a pattern for the use of resources developed from workload demand data.
3. Define and standardize terms & formulas with division of direct, indirect, education, orientation, and paid not worked benefit hours and FTE’s.
4. Clearly identify pay incentives, premium pay, bonuses, on-call/call-back.
5. Monitor OT for both “regular” and “EOS” or incidental occurrences & trend for use & abuse patterns.
6. Publish schedules with at least 85% of work from “core” employees in the unit.
7. Require managers to publish schedules with <5% “holes” where shifts didn’t meet target requirements.
8. Monitor for the 6 underlying drivers for OT bi-weekly & compare to specific criteria.
9. Identify a pattern for the use of resources developed from workload demand data.
10. Monitor for the Labor Management Institute’s Target Thresholds to Total Worked Hours.

To get more information on the Labor Management Institute’s 10 overtime best practices, please watch this recorded webinar.

4 Reasons Businesses Need to Be Outsourcing Workforce Management to a Local Service Provider

No matter the size, all businesses are required to manage their workforce in one way or another. Whether that’s through processing payroll, recording employee work hours, or even performing HR functions. It’s an ongoing process that has to be done promptly and more importantly, it has to be done right.

For small to mid-sized businesses, dealing with the everyday challenges of maintaining a successful operation can be stressful enough, let alone adding back office tasks to the mix. The one way for businesses to eliminate these often mundane and time-consuming tasks is to automate and outsource them to you, a trusted service provider. By offering your services and expertise in combination with an automated workforce management platform, businesses can finally get back to focusing on what they do best.

As you may know, the benefits of outsourcing workforce management functions are plentiful. However, we have included the top four reasons why outsourcing is beneficial (if not essential) to the success of small to midsized businesses.

1. Lowers business expenses by reducing labor costs.

Automating and outsourcing workforce management processes results in fewer responsibilities for a business to have to worry about. This eliminates the need for unnecessary labor, such as bookkeeping or administration and allows the business to invest their money where it really counts.

2. Helps businesses to minimize liabilities.

With constant changes in labor laws and regulations, and the intricacies of processes like tax filing, it becomes nearly impossible for smaller businesses to stay abreast of every detail involved. Noncompliance can become a huge problem for businesses, costing them thousands of dollars in penalties and legal fees. However, businesses who outsource these processes can breathe a sigh of relief knowing that their service providers stay well-informed with all current laws and regulations to help them remain in compliance.

3. Increases overall workforce productivity.

Outsourcing workforce management processes enables staff to concentrate on the core of their business’s success by freeing up their time from unnecessary tasks. With increased flexibility, a business can worry less about making sure things like payroll are processed on time and focus more on strategic initiatives that can improve their bottom line.

4. Allows businesses to take advantage of service providers’ expertise and knowledge.

There are no better experts in the workforce management field than skilled, regional service providers. Equipped with tools and other valuable resources, they serve as local specialists to their clients. Automated workforce management platforms provide a great solution for routine tasks but service providers offer an extra advantage by giving professional insight and tailoring solutions to the specific needs of a business.

It’s hard to imagine businesses not seeing the value of outsourcing and automating workforce management functions. It’s cost-effective, reliable and better yet, it’s stress-free. 

To get further insight from experts on the benefits of outsourcing, give us a call at 303-645-4270, visit us at mosaices.com or email us at info@mosaices.com. We are excited for the opportunity to talk with you and see if there are ways to help your company thrive.