How does workforce management software help with compliance?

Mar 31, 2023

Since the turn of the century, governments in advanced economies have continuously increased the level of regulation that businesses must comply with when it comes to staffing. This is particularly true of shift workers and hourly paid employees. Many of these regulations are well-policed and enforced with hefty fines. This has created an administrative burden for employers such that even small businesses now need to use software to ensure compliance. 

Throughout this blog article, we will examine how does workforce management software help with compliance and help employers stay on the right side of labour laws. It focuses on laws in the EU and UK but can equally apply to any modern economy as the types of regulations are similar.

Why is workforce management software a good fit for managing compliance issues?

Modern cloud-based workforce management solutions are great tools to support compliance, and many vendors have invested in features that protect their customers and make their job easier.

Workforce management software has data that allows it to support a number of checks to ensure compliance with various regulations. These include:

  • When someone has worked
  • Whether they were qualified to do the job
  • How much is someone paid
  • What leave is taken, and how much of that is paid
  • What breaks are taken and when

Because many regulations involve measurements of maximums and minimums of hours worked, leave or breaks taken and amount paid, a workforce management system has all of the data required to calculate if a breach occurs.

how does workforce management software help with compliance

What regulations can workforce management software help me comply with?

Here are some of the regulations that workforce management software can help you manage:

  • (EU) Working Time Directive:  These rules are about breaks between shifts, time off and maximum hours worked. They can be quite complicated to manage, especially if you employ under 18s.
  • National Minimum Wage: ensures you don’t pay an average salary below any legal limits.
  • Leave entitlement: Ensuring staff get the paid the leave they are entitled to.
  • Pension regulations: ensuring the correct pension contributions are made.
  • Union agreements and other local arrangements: If you have a set of rules that you have agreed with your employees, then you will want to be able to configure your WFM system to track and manage these.
  • Audit and financial regulations: Financial audits are all about accurate information. A WFM platform automates much of the process of generating financial data relating to an organisation’s biggest cost; its staff costs. Many can update your financial and accounting system directly within a few hours after trading or the payroll week ends. 
  • Visa regulations: Some student visas in some countries limit the number of hours that can be worked, and some work visas have expiry dates.
  • GDPR: Cloud-based systems with two-factor authentication are generally considered safe places to store PII (Personal Identifiable Information). Compared with spreadsheets and paper systems, a cloud-based workforce management system will make looking after your employees personal data easier. Choose a supplier which is ISO 27001 certified, and you are in even better shape.
What regulations can workforce management software help me comply with

How does a workforce management system keep you compliant?

As we mentioned above, the workforce management system has all of the data required to calculate if a breach occurs. So they include reports and alerts when they calculate that you are about to or have breached a labour law. They also do calculations to ensure that you don’t breach any regulations. Here are some examples of how they help in practice:

  • Working time directive (WTD): we have written a blog article just on this subject because it’s quite a key set of rules to comply with. In summary, the WFM checks every shift in every rota that is being built and alerts the user of any breaches that are about to occur. Auto scheduling tools are also designed not to build shifts that breach the WTD. Even though a shift may have been planned as compliant, changes at a later stage can cause a breach. For example, if a manager asks someone to stay late and they have only the minimum requirement of 11 hours between shifts, that will cause a breach. Good WFM software should help you deal with this and also provide you with a report of any breaches so you are aware and can educate managers.
  • Leave accruals: Holiday leave calculations for hourly paid staff can be complex and based on the average hours worked over a period of weeks, including overtime. If staff have multiple contracts, i.e. different rates of pay for different roles, this needs to be taken into account. The WFM system should calculate the holiday entitlement and keep a running total or holiday balance.
  • Visa regulations: By storing the expiry date of a visa, a workforce management system can block someone with an expired visa from being scheduled.
  • National minimum wage: Most workforce management tools have a method of calculating the average pay over a given period and alerting employers if there is a national minimum wage breach. This is age sensitive, so the system needs to know the date of birth to do this. 
  • Pension calculations: this tends to be done on a payroll system, however the WFM platform provides the gross payroll data, and so any miscalculation of gross pay can lead to underpayment.

Want to more about this topic or would like to speak to us regarding anything Workforce Management related? Just get in touch with us below and we'd be happy to help.

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