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Preparing for Compliance Changes Under a New Administration
Sponsored by:
Cliff Stevenson,
Principal Analyst,
Workforce Management,
Brandon Hall Group
Kristen Wylie,
Product Marketing Director
Kronos
HCM Research and Advisory Firm
2
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Sample of Our Clients
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How We Help You
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MEMBERSHIP
STRATEGICCONSULTING
EXCELLENCEAWARDS
PROFESSIONAL DEVELOPMENT
Learning & Development
Talent Management
Leadership Development
Talent Acquisition
Workforce Management
Agenda
4
What’s the objective of today’s presentation?
What study or key findings will be presented?
What case study or use case will be discussed?
Will there be tips on how to get started? Or key takeaways that I can use?
© Brandon Hall Group 2017
© Brandon Hall Group 2017 5
What’s the Deal With
Compliance?
POLL 1: How Do You Expect Compliance to Change in 2017?1. I think there will be less regulation than we have now
2. I think there will be the same amount of regulation as we have now
3. I think there will be more regulation than we have now
4. We might as well consult a Ouija board
© Brandon Hall Group 2017 6
Expected changes to regulation
• Repeal of ACA possible, but not likely• Most are stating a “fix” over “remove” strategy
• Ironically, this may lead to more regulation, especially at the state level
• New (2016) FLSA under temporary injunction, Congress last heard testimony on February 16, 2017
• New DOL head to be sworn in• Best guess: there will still be a salary test, it may (read : will) be different than
current/frozen FLSA rules
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What is Your Estimated Compliance Risk?
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Source: Instructure, 2016, n=2,246
14%
56%
17%
13%
We have no compliance risk We have small amount of compliance risk
We have a moderate lievel of compliance risk We have a large amount of compliance risk
Has Your Organization Ever Undergone a Compliance Audit?
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48%52%
No Yes
How Often Do You Review Government, Union or Other Regulations that Affect How you Pay Your Employees?
10© Brandon Hall Group 2017
12%
5%
19%
9%
23%
6%
18%
8%
Monthly Bi-monthly Quarterly Semi-annually Annually/onceper year
Less than onceper year
Ad hoc We have neverinternallyassessed
compliance
0%
5%
10%
15%
20%
25%
Greatest Challenges Organizations Face When Keeping Up with Regulatory and Compliance Changes
11© Brandon Hall Group 2017
37%
25%
40%
38%
20%
21%
23%
Current technology systems are inadequate for compliance tracking
Lack of funding/budget
Lack of employee resources for data collection and tracking
Incomplete understanding of compliance regulations
Lack of support from senior leadership
Resistance to new processes from line-level managers
There are no major barriers to compliance
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Do You Outsource?
12© Brandon Hall Group 2017
74%
3%
13%
10%
No, we do not outsource compliance Yes, our compliance partner is slightly effective
Yes, our compliance partner is moderately effective Yes, our compliance partner is highly effective
Which Process Best Describes Your Organization’s Compliance Reporting Capabilities?
13© Brandon Hall Group 2017
8%
52%12%
28%
We do not track compliance at all Semi-automated (some functions automated, some are not)
Automated throughout organizations Manual
Which of the following features is most important in compliance technology?
14© Brandon Hall Group 2017
8%
16%
17%
18%
19%
24%
26%
29%
34%
38%
56%
Push notfications (mobile)
Job coding
Cloud-based
Explantory text or video for new regulations
Time/hour tracking 35
Forced compliance
Integration with other HCM systems
Case management
Automatic updating
Advanced analytics
Document management
0% 10% 20% 30% 40% 50% 60%
Assessment of Needs
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Compliance Decision Matrix
16© Brandon Hall Group 2017
© 2017 Brandon Hall Group 17
Compliance Decision Matrix
© 2017 Brandon Hall Group 18
Compliance Decision Matrix
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Compliance Decision Matrix
© 2017 Brandon Hall Group 20
Compliance Decision Matrix
Actionable StepsHCM SOLUTIONS HELP MINIMIZE COMPLIANCE RISK
Compliance Concerns: Challenges at Every Turn
Odds NOT in employers’ favor…
Source: https://dayshift.com/2016/01/04/flsa-minimum-wage-overtime-lawsuits-set-new-record-in-2015-filing-growth-continues/1352/
Source: David Weil, Measuring Real Impacts for Workers (February 2015), found at https://blog.dol.gov/2015/02/26/measuring-real-impacts-
for-workers/.
Odds NOT in employers’ favor…
$266 Million in Back Wages in 2016
Source: https://www.dol.gov/whd/data/
The HR Transformation Journey:Optimizing the People Part of Your Business
Automated
• Paperless environment
• Standardize processes
• Disparate systems
Manual
• Paper and spreadsheets
• Complex requirements
• Errors and fines
Strategic
• Integrated systems
• Attract, hire and develop top talent
• Communication and collaboration
Data-Driven
• Unified platform
• Actionable data provides insight
• Measure the impact your people have
• Employee engagement and retention
One Unified Platform for the Entire Workforce
Compliance Concerns
Centralized Administration
HR is a Business Partner
HR is a Business Leader
ONE UNIFIED PLATFORM FOR YOUR ENTIRE WORKFORCE
CENTRALIZED POLICY ADMINISTRATION
LOCALIZED POLICY ENFORCEMENT
DETAILED AUDITING & TRACKING
Recruiting
Benefits
Human
Resources
Payroll
Leave
Scheduling
Time &
Attendance
Compensation
Performance
Automate Processes to Minimize Compliance RiskTimekeeping and Scheduling
• Centralized policy administration
− Managed by HR and Legal versus individual line
managers
• Flexibility around the globe
− Different rules in different countries
− Different rules in different states
− Different rules in different cities
• Need to centralize to effectively manage
• Exposed from a risk perspective if not automated
Supervisor Resolves Discrepancies
Payroll Keys Timesheets IntoPayroll System
Check Cut and Distributed
Errors Reported to PayrollPayroll
Flags Issue
Employee Data Gathered Using Various Manual Formats
Supervisor Collects, Calculates, and Approves
Various Timesheets
Reports After The Fact – Done
Manually
Employee Errors
• Transcription
• “Buddy punching”
• Gaming rounding rules
Supervisor Errors
• Difficult to catch errors
• Preferential treatment
• Wrong interpretation of rules
• Wasted time on tedious work
System Errors
• Poor data validation
• Rules improperly applied
• Inability to flag problems
• Delayed reporting
A Breeding Ground for Errors
Scheduling Changes
Lack of
Efficiency
Poor &
Hidden Data
Numerous
Rules
& Requests
Scheduling is a Balancing Act
Demand
Labor Laws
Availability/Leave
Preferences Skills/Certifications
Policies
Costs
Use Your Technology to Understand Potential Impacts
• FLSA Changes
− Do you know who has been impacted?
− Do you typically require these impacted employees to work over 40 hours a
week? How many hours do they actually work?
− If these employees typically work more than 40 hours per week then what is
your strategy?
• Pay overtime?
• Hire additional employees?
• Modify business metrics?
− How will you track their time?
Key Recommendations & Questions
Key Recommendations
• Assess your organization’s readiness for regulatory compliance
• Determine which facets of compliance are putting your organization at risk
• Automate systems that were previously manual, beginning with the high-risk
compliance areas identified previously
• Compliance and automation do more than protect, they also create opportunity
for strategic decision-making (rather than reaction)
• Constant vigilance is required, even in the most robust of compliance
environments
© 2016 Brandon 35
© KRONOS INCORPORATED │ April 13, 2017 │ 36
Questions?
• Cliff Stevenson
− @clifforddarrell
• Participate in Brandon Hall
Surveys:
− For a complete list of surveys that you
can take, please visit our survey page
here.
− If you would like to join a panel of
survey takers, please contact us at
• Kristen Wylie
