u.s. department of labor employment standards administration (non)compliance monitoring what to look...
TRANSCRIPT
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U.S. Department of LaborEmployment Standards Administration
(Non)Compliance Monitoring
What to look for and how to find it … (Davis-Bacon payrolls)
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U.S. Department of LaborEmployment Standards Administration
Payroll reviews…Ensure all laborers and mechanics no less
than the required pay based on:Type of work performedHours worked, including any overtime
Monitoring for violations not compliance
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U.S. Department of LaborEmployment Standards Administration
Types of violations… Face of the record
InadvertentEasily resolvedIf early, not too costly
Concealed (falsification)WillfulIndependent validation / investigationBigger bucks / bigger impact
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U.S. Department of LaborEmployment Standards Administration
Why DOL?
ResourcesTrained investigatorsBroader scope of authorityPotential for debarment
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U.S. Department of LaborEmployment Standards Administration
Compliance FactorsType of work performed (classification)Number of hours worked (straight time and
overtime)Wage rate for the classificationActual payment to the worker
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U.S. Department of LaborEmployment Standards Administration 6
Spot-Check PayrollsReview for major tradesDetect patternsCompare on-site interviewsFocus on falsificationEnsure corrections, as needed
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U.S. Department of LaborEmployment Standards Administration
1st things 1st…Sort by employer / arrange by dateCheck the signatureCheck the data If not, require resubmission – never return
payrolls for correction
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U.S. Department of LaborEmployment Standards Administration
Next steps…Face of the record
Work classifications / pay ratesHoursApprentices / traineesComputationsRequire corrections if neededRestitution on correction certified payroll
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U.S. Department of LaborEmployment Standards Administration
A closer look…Concealed violations
MisclassificationReduced hoursDeficient rate of pay / fringe benefitsUnauthorized deductionsKickbacks
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U.S. Department of LaborEmployment Standards Administration
Payroll Falsification IndicatorsPayrolls data are simplePatterns over timeAnomalies / mistakesWhat’s false / what’s true?
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U.S. Department of LaborEmployment Standards Administration
Ratio 1:1…Example:
10 Laborers : 2 Electricians
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U.S. Department of LaborEmployment Standards Administration
Ratio 1:1?Misclassification
Possible exceptions: Landscaping; cement; paving
What is false / what may be true
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U.S. Department of LaborEmployment Standards Administration
Too few / irregular hours…Examples:
No 40 hour workweeksCrew doesn’t work togetherHours reported in 10th or 100th
fractions
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U.S. Department of LaborEmployment Standards Administration
Too few / irregular hours?Reduction of hours / backing into hoursHours reduced to fit fabricated calculation
Earnings ÷ WD rate = false hours What is false / what may be true
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U.S. Department of LaborEmployment Standards Administration
Computation discrepancies…Examples:
Hours x rate of pay ≠ gross earnedRound gross earned from uneven DB
wage rates
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U.S. Department of LaborEmployment Standards Administration
Computation discrepancies? Insufficient hourly rate / piece workHourly wage / piece rate can’t meet DB rateEr disregards math to match gross earnings /
net payWhat is false / what may be true
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U.S. Department of LaborEmployment Standards Administration
Extraordinary deductions…Examples:
Unidentified / disproportionate deductions
Savings / other deduction ≥ take home pay
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U.S. Department of LaborEmployment Standards Administration
Extraordinary deductions?Kickback or basic underpaymentEr takes “cut” from the back endWhat is false / what may be true
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U.S. Department of LaborEmployment Standards Administration
Worker complaint… All manner of underpayment / falsification schemes
Employer pays in cashEmployer “cashes” pay checks“Ghost” employees
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U.S. Department of LaborEmployment Standards Administration
Compliance excess…Employer submits employee “labor
releases”Employer submits unrequired /
unrequested documents
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U.S. Department of LaborEmployment Standards Administration
Next steps… Validate suspected violations
What happened / what do you needHow much restitution / LDs
Contact Federal funding agency / DOL? Request employee addresses / SSNs
Send questionnaires (customize – what’s false/what’s true)
Target on-site interviews
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U.S. Department of LaborEmployment Standards Administration 22
On-Site InterviewsValidate / test payroll data (inspector’s
observations / employee perspective)Get a “good” story – focus on suspect activityDevelop complaints / substantiate suspected
violationsTarget interviews
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U.S. Department of LaborEmployment Standards Administration
Record of Employee Interview (HUD-11 / HUD-11SP)
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U.S. Department of LaborEmployment Standards Administration
More steps…Assess the dataEstimate restitution / CWHSSA L/DsConsider withholding
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U.S. Department of LaborEmployment Standards Administration
Then what? Informal consultation
Nature of the violationsScope of violations
Send summary / documents Cooperate / ensure withholding Monitor for non-compliance
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U.S. Department of LaborEmployment Standards Administration
At any point… Contact the Federal funding agency / DOL if:
You have any questionsNeed assistanceThere is any suggestion that kickbacks are
involved
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U.S. Department of LaborEmployment Standards Administration
Resources… DOL Wage and Hour Division
http://www.dol.gov/esa/whd www.dol.gov/esa/whd/recovery
HUD Office of Labor Relationswww.hud.gov/offices/olr
Wage Determinations On-Linewww.wdol.gov