Employers Group Blog Connection

33% of Mid Sized U.S. Companies have Incurred Federal Penalties For Non-Compliance

Posted by Nicole Vierzba on Thu, Aug 16, 2012

Thirty Three percent of mid-sized companies in the U.S. have incurred federal penalties for non-compliance with government regulations over the past year. Unfortunately, for the most part, the penalties don’t seem to have occurred due to just one minor slip up - of the thirty three percent that incurred penalties, around six non-compliance issues were found on average!Be careful!


The study also found that businesses with in-house payroll processing received almost three times the number of penalties than those who outsourced their payroll processing. Organizations with in-house payroll processing had an average of five to six fines compared to two fines for companies with outsourced payroll operations.


Unsurprisingly, risk of non-compliance issues can be even more problematic when using temporary labor and multiple staffing vendors because it’s harder to keep track of temporary employees and contractors used throughout organizations. Often, departmental managers will “hide” temporary workers and contractors under other cost centers so that they can keep within their official headcount.


Because of the dramatic growth of the contingent workforce, government agencies such as the Department of Labor and the IRS are taking a keener interest in the use of contingent workers – making it essential for companies to track the use of all types of flexible labor within their organizations and to use stable, experienced employers to manage the employment obligations of those workers.


Do you have compliance questions?  

Don't hesitate to contact one of Employers Group's compliant experts.  E-mail us at serviceone@employersgroup.com or call us directly:  800-748-8484.


Article courtesy of Jill Stoppard, Emergent http://emergent.com/index.html


Topics: compliance, risk assessment