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What is Time Theft, and How to Avoid It

Posted by Stacey Duggan

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Oct 7, 2013 10:54:00 AM

What is Time Theft and How to Avoid ItIn tough financial times, businesses try to streamline their operations to run as inexpensively as possible. They may reduce business hours, lease less property, or make changes to products and services. One lesser known strategy for reducing expenses is to tackle the problem of time theft.

What is time theft?

Time theft is a worker getting paid for work they did not actually do, and it costs Canadian businesses as much as $5 billion per year. As you can imagine, time theft has a big impact on the financial success of businesses, and it could be hurting yours.

Let's take a look at some of the ways time theft could be eroding your company’s profits.

1. A faulty "punch card" system.

Employers have different ways of clocking their employees' hours, and sometimes employees figure out how to manipulate the system so it looks like they're working more than they actually are. This happens when employees "punch in" for each other or find a way to clock in remotely. If you feel that there are inefficiencies or "holes" in the way you track employee hours, take a close look at your system. Your bottom line could be severely affected by this form of time theft.

2. Personal time on the phone.

Everyone has to make personal phone calls from time to time, and sometimes it's necessary to handle personal matters during business hours. Every employer understands this. But when employees make a habit of spending time on personal phone calls while they're supposed to be working, they are committing time theft. In essence, you are paying them to handle their personal lives instead of paying them to complete the work they agreed to. Review your company's policies about personal phone time, and inform employees that they must abide by these policies.

3. Tardiness, long breaks, and leaving early.

This form of time theft is not as common for hourly employees, but it's not uncommon with salaried workers. When employees stretch a 30-minute break to 45 minutes, and when they come in late or leave early, they are stealing from your company. If this is a chronic problem in your company, re-evaluate your procedures for managing your employees' time on the job. Does a supervisor need to pay more attention to break times? Do you need to schedule early morning meetings to hold employees accountable for arriving on time?

4. Non-work computer usage.

The Internet is a minefield of distractions, and it's all too easy for employees to let their attention stray away from their work while they're on the computer. There are many things you can do to help your employees avoid this time theft temptation. Turn computer screens toward a public area so anyone walking by can see what's on the screen. Instruct your system administrator to block social media sites and YouTube. During your training and instructional meetings, remind employees that their work computers are for just that: work. And help them to develop good work habits and standards for themselves that will help them to be more productive employees.

By paying attention to time theft and how it affects your company's productivity, you can save money and improve your employees' work. For more information about time theft, or to discuss other human resource and payroll issues, contact us at The Payroll Edge. Our payroll experts can help you to find solutions to your problems.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Service Provider, Canadian Payroll, Canadian Payroll Service, hire payroll service, Best Payroll Calculator, human resources, Employee Policies, Temporary Staff Agency, Temporary Workers, Time Theft, Human Resources Issues

How Outsourced HR Management Services Can Improve Your Business

Posted by Stacey Duggan

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Jul 22, 2013 9:00:00 AM

Outsourced HR ManagmentBusinesses often try to make do without an in-house HR department, rationalizing that since human resources employees don't directly contribute to the bottom line of the company's operations, they're superfluous. The truth is the work done in the human resources area of your company is essential to your company's functioning and success.

Your business success depends entirely on the people working for you, and by neglecting this critical people part of your business, you open yourself up to running into not only personnel and management trouble, but maybe even trouble with the law.

Here are three areas that demonstrate why HR management is essential.

Employee Relations

From the moment you post a job listing for a position in your company, you need systems in place to help your employees to help you. You need up-to-date HR policies, job descriptions, employment agreements, and orientation materials and handbooks.

Once your employees are hired, you need to be prepared to deal with sensitive issues like disciplinary misconduct, lay-offs, and terminations, and possibly employee outplacement. You must stay on top of the legislative changes that could affect the way you work with your employees to ensure you are always in compliance with the law.

Employee Training and Development

As an employer, it's your responsibility to provide a workplace that is safe,respectful and accessible. Some laws mandate particular attention in certain areas, including the development and implementation of proper training, monitoring and testing for:

  • Health and Safety
  • Emergency Preparedness
  • Workplace Violence and Harassment
  • Workplace Claims Management
  • Compliance with AODA (Accessibility for Ontarians with Disabilities Act)
  • Compliance with WHMIS (Workplace Hazardous Material Information System)
  • Workplace Inspections
  • Hazard Identification
  • Slips, Trips, and Falls

The Health & Safety of a workforce should be priority to any employer, but often gets pushed to the back burner as the day to day tasks of regular operations take precedence. Fines and penalties can quickly add up for a business owner who doesn’t take the time to ensure their health & safety due diligence. Not to mention the very real possibility of a workplace injury due to an untrained or improperly trained employee.

Regulatory Compliance

Compliance with the Ministry of Labour, The Employment Standards Act, and the Occupational Health and Safety Act also falls under the responsibility of an HR department. Keeping up to date with the ever evolving rules and regulations, customizing paperwork and manuals and acting as a liaison with these government agencies is time consuming and takes expertise that few companies have in house.

Even when an HR department is thorough with their compliance, incidents with employees are bound to take place. Does the person acting as HR know how to conduct a workplace investigation when a worker is injured or handle an audit from the MOL? What if an employee claims harassment or needs to take a leave of absence, does the acting HR person know the proper steps to take?

Unfamiliarity with the minefield of HR can be extremely costly not just from a monetary point of view but when considering employee morale and reputation as well.

The Outsourcing Option

Any of these areas can directly impact your bottom line, but the costs of hiring on-staff HR management can be difficult to justify from an ROI perspective. And delegating the HR administrative load to other staff members puts a counter-productive strain on existing resources and productivity bandwidth. Thankfully, there is a way to ensure effective management of these staffing issues without having to add an HR Manager to your headcount.

HR can be outsourced. The Payroll Edge, for instance, handles all of the above for hundreds of companies as an ala carte solution or as part of its integrated payroll processing service, providing a completely hands-off HR management solution for busy business owners. And it does it for much less than hiring a full-time HR person or retaining expensive lawyers or HR consultants.

You don't have to spend your time and worry on HR Management, The Payroll Edge takes it all off your hands, freeing you to focus on what you do best – run your business.

7 Signs It's Time to Outsource Payroll

Topics: Outsourced HR Management, Employee Policies, Employee Training and Development, Employee Relations, Compliance, HR Management, Regulatory Compliance

How ESA Violations Can Put Company Directors in Jail

Posted by Ray Gonder

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Jul 19, 2013 9:00:00 AM

http://i.istockimg.com/file_thumbview_approve/14624102/2/stock-photo-14624102-group-of-men-in-prison-cell.jpgYou're a hard-working, law-abiding citizen. In fact, you have worked hard enough that you employ other people who count on you for their pay cheques and benefits. You should be aware, however, that you could face severe fines and even jail time for violations of the Employment Standards Act (ESA).

What is the ESA?

Signed into law in 2000, the Ontario ESA regulates wages, work hours, and workplace health and safety in Ontario for provincially-regulated companies. The Ontario Ministry of Labour (MOL) enforces these regulations, educates and informs employers about how to comply with ESA regulations, investigates potential violations, and resolves complaints from employees.

It can be difficult to know all of the standards that make up the ESA. To help, the ESA produces a workbook to help employers know and understand their obligations under the Employment Standards Act. For starters, the workbook lists ten different areas in which employers need to be well-versed to be ESA-compliant:

  1. The ESA Poster
  2. Payment of Wages
  3. Wage Deductions
  4. Work Hours
  5. Eating Periods
  6. Overtime Pay
  7. Minimum Wage
  8. Public Holidays
  9. Paid Vacation
  10. Termination and Severance

You might think that common sense could help you to navigate these standards, but that's not necessarily true. For example, in the workbook section about Public Holidays, you'll read, "Although vacation pay is not considered to be part of one's regular wages, the calculation for public holiday pay includes any vacation pay that was payable to the employee during any of the four work weeks prior to the work week in which the public holiday fell." Clearly, ESA standards are not always obvious or even, well, clear. And this leads us to the problem at hand.

ESA Violations

If you take a look at convictions under the ESA for March of this year, you'll see that there are several different ways that employers have violated the Employment Standards Act. One company failed to retain records, another failed to make records, several failed to pay for overtime, and another failed to give an eating period during a work shift. Most of these ESA violations resulted in fines of less than $500, but this shouldn't make you feel that you can relax when it comes to abiding by ESA standards. In fact, at least one Ontario employer is currently serving jail time for non-compliance.

The owner of six Ontario companies ignored orders by an MOL officer to correct wage payment problems with 61 employees at all of the six companies he owned. Under ESA, a director of a company can be held personally liable for violations of the law, including failing to pay wages. The Ministry of Labour charged the owner and his companies with failure to comply with orders, to which he pleaded guilty. He was fined $280,000 and ordered to spend nine months in prison.

If the owner had complied with the initial orders from the Ministry of Labour, he would certainly be in a much better position today. Perhaps he ignored the orders because he had too much to do and felt that ESA violations were not a big deal.

You don't have to spend a lot of time and resources complying with the ESA. But if you feel you don’t personally have the time to read through the workbook and answer all the questions, the specialists at The Payroll Edge can take care of that for you. Or if you've already found yourself involved with ESA violations, we can help you with that as well, mediating with the Ministry of Labour and helping you to resolve past infractions, while making sure your programs and policies will keep you in the clear in the future.

To find out more about ESA violations, contact us at The Payroll Edge.

7 Signs It's Time to Outsource Payroll

Topics: Ministry of Labour, Payroll Service Provider, Outsourced Payroll Service, Employment Standards Act, Employee Policies, MOL, ESA, ESA Violations, ESA Compliant

Three Big Mistakes with Employment Contracts and Policies

Posted by Ray Gonder

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Jul 17, 2013 10:30:00 AM

Employment Contracts and PoliciesA business with thoughtful and up-to-date employment policies is a business that runs well, even when it faces personnel turnover and industry changes. If you're uncomfortable setting and enforcing employment policies, you may find your business in a constant state of confusion or crisis. Even worse, you could find yourself on the wrong side of the law, facing fines or court cases if your employment policies are not in compliance with recent law changes. Let's take a look at three big mistakes that businesses make with employment contracts or policies.

1. Neglecting to State that Severance Payments are Subject to Mitigation in Employment Agreements

In the last year, the Ontario Court of Appeal made a ruling that could be very costly to employers who aren't paying attention. The court ruled that "employment agreements with a fixed severance term are not subject to an employer's implied right to deduct any mitigation earnings received by the employee during the notice period." If you're like many employers, you may have quite a few existing employment agreements that have fixed severance terms. If you want to be able to deduct mitigation earnings that were received by dismissed employees, you need to revise your employment agreements so they specify that severance payments are subject to mitigation. By making this simple change, you can avoid costly expenses in the future.

2. Ignoring Changes in Non-competition Terms

Recent changes to laws regarding non-competition covenants could be costly to your business. Laws continue to change, and if you don't keep up on new and subtle nuances to the law, you could find yourself in a weak position. It's no secret that non-competition covenants are difficult to enforce, but you have a much better chance of success when you use non-competition covenants that comply with the courts’ freshest and most current tests.

3. Neglecting to Review Your Compliance with the Accessibility for Ontarians with Disabilities Act, 2005 (AODA)

If your business employs more than 20 people, you need to pay special attention to AODA compliance. The AODA requires all organizations with 20 or more people to file a Compliance Report with the Ministry of Community and Social Services. This report confirms that your business follows all rules and regulations included in the AODA's Customer Service Standard. But that's not all. Even if your business just employs a single person (you), you need to create and implement an accessibility policy. This policy should include plans for disabilities that affect communication, benefit from the use of assistive devices, or require service animals. The policy should also focus on principles of equal opportunity, independence, integration, and dignity.

Obviously, it's difficult to keep up with employment policies. You're busy trying to keep your business running smoothly. You have plenty to do with your daily tasks without trying to keep up with legislative changes that may or may not affect your business.

A full service outsourced payroll firm can help you keep up with changes in employment policies so you don't have to. At The Payroll Edge, for instance, we ensure that our clients don't run into problems with employment contracts issues like severance plans, non-competition, and AODA compliance because we review their current policies and make updates if they're needed. And if you don't currently have an up-to-date employee policy, we can help you to become fully compliant with all government regulations.

For more information about how The Payroll Edge can help you to avoid costly problems with employment policies, or for information on other payroll and business services, contact us. We'll be happy to discuss your business' individual needs and make a customized plan for you.

What Are You Leaving to Chance by Handling Payroll on Your Own

Topics: Payroll Service Provider, Outsourced Payroll Service, Employee Policies, Payroll Calculator, Great Payroll Service Provider, Employment Contracts

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