Stay Out of the Headlines with Industry-Leading Compliance Processes
Now more than ever, companies are hitting the headlines for the wrong reasons: violations, fines and penalties. Recent reports from Staffing Industry Analysts (SIA) and ICE Mutual Agreement between Government and Employers (IMAGE) illustrate just how serious compliance issues can be, both in terms of cost as well as brand protection.
For example, SIA reports that the Connecticut Department of Labor ordered 19 companies to stop work between January 26 and February 23, 2012 due to employees being misclassified as independent contractors. Altogether, the Connecticut Department of Labor has issued 245 “stop work” orders in the past twelve months, resulting in $250,000 being collected in civil penalties for the misclassifications.
In January 2012, IMAGE reported that two companies, Atrium Companies and Advanced Containment Systems Inc., based in Houston, TX have agreed to each pay $2 million as forfeited funds to the Department of Homeland Security (DHS) for failing to comply with immigration and labor laws and hiring illegal aliens. Both companies received multiple notices from the Social Security Administration (SSA), but failed to take corrective measures, resulting in the continued employment of the undocumented aliens and ending with forfeited funds and a tainted public record.
Additionally, in January 2012, SIA reported citations of over $260,000 in fines for unsafe working conditions to staffing buyer National Distribution Centers and staffing firm Tri State Staffing. The citations covered more than 60 violations, including lack of fall protection from high-rise pickers, unstable storage stacking and unguarded machinery, at four warehouses in Southern California.
As the last example illustrates, if you are partnering with a staffing supplier you must take special care to ensure that they too are in compliance with employment law. “When employers use a contractor for their staffing needs, they are not released from their responsibilities to provide a safe workplace,” says California Division of OSHA Chief Ellen Widess.
However, with proper processes in place or partnerships with trusted contingent workforce management providers, these incidents can be avoided. At Staff Management | SMX, we follow these five best practices to ensure we are in compliance with staffing and safety laws, and that our clients are receiving the highest degree of brand protection possible:
- E-Verify: E-Verify is an internet-based system that allows businesses to determine the eligibility of their employees to work in the United States. The use of E-Verify can help companies avoid costly violations, fines and penalties.
- IMAGE: Benefits of IMAGE certification include brand name protection, fine mitigation, ICE training on proper hiring procedures and fraudulent document awareness, among others.
- Workers’ Compensation Risk Certification: WRC is a staffing-specific program focused on the critical area of safety and risk management for staffing providers.
- Safety Programs: Your staffing provider should be committed to providing a safe working environment for your employees and temporary associates as well as maintaining safe work practices.
- Proper Worker Classification: Misclassification occurs when an employer hires a worker and improperly classifies that worker as an independent contractor instead of as an employee. Employee misclassification is becoming an increasingly large problem impacting employers, workers and the government.