If you’re an HR manager or payroll administrator, you may be well-versed in the importance of compliance within your organization. When employers violate laws that determine how their employees are paid, they could face hefty penalties.
Despite how crucial it is for your business, compliance can be incredibly complicated. Federal, state, and local regulations can be tricky to navigate. Not only do they vary depending on your location and industry, but they also tend to change frequently.
Innovative solutions to compliance issues are becoming increasingly popular, which is hugely beneficial to companies of all sizes. Let’s dive into the importance of compliance in workers’ compensation payroll and how innovative new features are enhancing compliance.
Importance of Compliance in Workers’ Comp Payroll
Payroll compliance is crucial for every organization—no matter how many employees you have. While fines for noncompliance could be detrimental to your company, the importance of remaining compliant extends far beyond potential monetary penalties.
Compliance in workers’ comp payroll is essential for protecting employees.
There are different laws in place that help ensure equal pay, solidify minimum wage and overtime rates, and ensure employees have the workers’ comp coverage they need. Staying compliant with rules and regulations also means employees get paid on time, taxes are filed correctly, and payroll records are clear and concise.
Noncompliance with state and federal laws can affect the entire organization. While it likely means getting hit with penalties, fines, and potential legal expenses, it can also result in decreased employee morale. An employee’s satisfaction—or dissatisfaction—with their employer can have a major impact on company culture.
Because of how impactful compliance is in the workplace, looking for innovative ways to improve it is essential to the success of the company.
Innovative Features in Modern Payroll Solutions
Modern payroll solutions can make a huge difference in how employees are paid. Noncompliance with state and federal laws may not necessarily be intentional—in many cases, mistakes simply happen while conducting payroll manually.
Utilizing payroll software is crucial for any business that wants to maintain compliance. With a modern payroll system, both the employer and employee can access payroll through a user-friendly app. This makes clocking in and out, choosing benefits packages, and accessing workers’ compensation information simple and straightforward.
In addition to accessibility, benefits management, and time tracking, automation is one of the most important features of a modern payroll system. An automated system will adjust payment according to time worked, overtime, bonuses, commission, and deductions.
How These Features Enhance Compliance
Modern payroll features like time tracking and automation help ensure payroll is completed accurately and on-time, which ultimately enhances compliance with state and federal regulations. The easier it is for employees to access their information and clock in and out of work, the easier it will be to pay for those hours. When all an employee’s data is stored in one place, employers will experience a more streamlined payroll process.
Ultimately, a streamlined payroll system—with everything accessible in one place—means fewer errors, faster payment, and a smoother process overall.
Role of PEO Services in Providing Compliance Solutions
Professional employer organizations (PEOs) offer HR services for businesses that are ready to outsource their administrative tasks. Working with a PEO allows companies to focus their time and energy on building relationships with their employees and strategizing for business growth.
PEO services include payroll and tax filing, workers’ compensation, risk management, and comprehensive support. Partnering with a PEO means you’ll have experts available to assess potential compliance issues—from payroll to safety regulations—and help determine possible solutions. When you partner with a PEO you also have access to comprehensive support. No matter what questions you may have, a specialist will be available to help guide you through the process.
Working with a PEO like OCMI Workers’ Comp allows employers to streamline their payroll system—improving accuracy, timeliness, and compliance.
As technology continues to evolve, AI will likely play an even greater role in payroll automation—entering employee data, ensuring tax compliance, and detecting fraud. Enhanced cybersecurity will also be prevalent to ensure user data is protected.
Staying up-to-date with innovative workers’ comp payroll features is crucial to enhance compliance within your organization and thrive as a business.
