They’re complex, time-consuming, affect tens of thousands of businesses across the US, and - when it goes wrong - you could be hung out to dry for a million-dollar lawsuit.
Welcome to the ever-changing world of labor laws!
Failure to keep up with changing labor laws can quickly create a perfect storm of non-compliance and financial nightmares for your business.
That’s why it’s up to you (with a little help from Quinyx!) to stay on top of legal obligations like minimum wage changes, Fair Workweek, and overtime updates so your business remains compliant.
Failing to do so can have disastrous consequences for your business. Take the case of the fast-food chain, Chipotle. In 2021, Chipotle was faced with a multi-million dollar lawsuit by the City of New York for failing to adhere to Fair Workweek Labor laws that exist in the state. The company’s violations included changing employee schedules without proper notice, denying time off, and not providing premium pay to its workers.
This lack of compliance means the company is now on the hook for $150 million in compensation for not abiding by state laws.
Could your business afford to take that kind of hit?
The most successful businesses are investing in AI-driven WFM solutions to avoid compliance issues and seeing phenomenal returns on their investment.
Here are the three most common pitfalls to avoid when it comes to labor laws:
1. Wages adjust several times a year and are constantly changing
Minimum wages are adjusted several times a year and the changes happen at both a State and Federal level. There are now 30 states where the minimum wage is higher than the Federal minimum wage, and 18 states now have it indexed to inflation so it’s automatically raised every year.
It’s an incredibly hard job to keep track of all these changes and - when it’s done manually - the risk factor of something going wrong is huge.
Quinyx provides comprehensive configurations, so you can create flexible templates with the legal minimum wage for each location, geography, time of the day worked, and job - accounting for every federal, state, and regional wage law. The templates are easily configurable and copied. This allows you to accurately report pay, even as minimum wage laws change
After investing in Quinyx, a North American retailer with 8900 employees and 456 locations saved over 200,000 hours/year in workforce management administration resulting in over $1,200,000/year savings through automated and compliant scheduling.
Quinyx enabled this retailer to automatically pay staff according to rates based on their respective locations - even when working across multiple sites and states.
2. The confusing difference between paid and unpaid breaks
If you thought keeping track of wage changes was hard work, wait until you try and get your head around the minefield of paid and unpaid breaks.
Federal law says breaks lasting up to 20 minutes must be included in the employee’s weekly total of hours and considered when calculating their overtime. However, breaks of 30 minutes don’t need to be compensated.
Quinyx helps you maintain ideal labor coverage while optimizing break times based on forecast and scheduled employees. Our WFM solutions allow you to easily set up specific local conditions, while managers are automatically alerted if any employee’s time and attendance records are in danger of being violated
In fact, a nationwide restaurant chain with 12,000 employees and 600 locations saved $3,000,000/year by leveraging the AI-driven forecasting in Quinyx, resulting in increased labor optimization.
3. Paid leave, unpaid leave & sick leave
Without the right tools, managing paid, unpaid and sick leave can be laborious and time-consuming. It’s now become even more complicated due to legislation passed in response to the Covid-19 pandemic.
And, once again, different state and Federal rules combine to complicate the picture. For example, thirteen states now have laws that require employees to be given paid sick leave, and the Families First Coronavirus Response Act means small businesses have to give workers paid time off if they catch COVID-19, or if they need to go into isolation because an immediate family member is sick.
Employers are also required to give workers up to four hours of paid leave to get a
COVID-19 vaccination. The new regulations also state that these paid hours cannot be deducted from the employee’s accrued sick leave—making it an extra benefit.
Managing all of these effects is crucial for managers to ensure the business runs smoothly. Getting them wrong can lead to staffing shortages and employee conflict.
Using Quinyx, a nationwide food delivery service company with 9,500 employees has increased employee retention by over 10% and saved over $550,000 by reducing employee turnover.
To summarize, manual solutions to manage your employees or outdated WFM solutions can easily see you break labor laws, leading to compliance issues, lawsuits, and the prospect of hefty fines.
By investing in software to help you easily and effectively manage, optimize, and accurately forecast your workforce, you not only eliminate the risk of breaching labor laws, you see significant cost savings right across the board.
Download our Ultimate Guide to Workforce Compliance to dive deeper into the intricacies of labor laws and to see the ROI Quinyx will give you.