The same scenario plays out every week. Employees do their job and employers pay them for that job. Sounds simple, right? Well, sometimes processes break-down and that paycheck is impacted. Have you ever had a paycheck that was inaccurate, late, or worse didn’t come at all? Suddenly, the employee and employer have an issue at hand that has more than just monetary implications.
According to a new survey from The Workforce Institute at Kronos Incorporated an estimated 82 million1 Americans – more than half of the U.S. workforce – have experienced a problem with their paycheck during their career. The results of the survey go on to say that more than a quarter (26 percent) of hourly workers have been paid too little, while 15 percent say they’ve been paid late. For the salaried worker, 15 percent say they’ve been shortchanged in their check and 16 percent report being paid late.
On the flip side of things, there’s also the issue of paying employees too much. Calculations errors aren’t uncommon when time & attendance is tracked on paper. The survey found, on average, American workers say they must likely be overpaid a staggering $463 before alerting their employer to the mistake.
Public sector employers have an additional risk to adverse side effects from an incorrect paycheck. Regardless of underpayment or overpayment, the threat of the media putting a spotlight on perceived wasteful spending is real. It signifies a weakness that the organization isn’t in complete control over their payroll processes.
The truth is, Payroll employees are often over-burdened by illegible hand-writing, late or incomplete time sheets, and the sheer volume of paper that comes in. With this environment comes the potential for errors. Looking for areas of efficiency can lead to better accuracy and even cost savings.
Footnote 1: Calculation based on the U.S. Bureau of Labor Statistics report from January 2017 that estimates there are 152.08 million employed people in the U.S.: 152.08M x 54% = 82.12 million.
Still confused about the status of the proposed overtime regulations? Well, you are not alone. Since the preliminary injunction on Nov 22nd, 2016, many employers are left wondering if they will ever need to implement the courses of action they had ready for December 1st. And this is one scenario where being prepared ahead of time was a disadvantage. In a recent SHRM article, What’s Next for Employers Under the FLSA Overtime Rule?, we learn more than half of the audience at a conference on employment law already moved forward with reclassification changes.
In the same SHRM article, Tammy McCutchen, former administrator of the DOL’s wage and hour division under President George W. Bush and a principal with Littler in Washington, D.C, talks about what she sees as the future of the regulation. She encourages the Department of Labor (DOL) to consider a “restart and redo”. This would include proposing a new rule with the opportunity for another comment period before the final ruling.
There are some general thoughts that the threshold was set too high, especially for parts of the country where cost of living is lower. More than doubling the existing threshold ($23,660 t0 $47,476) can put a drain on employers. McCutchen goes on to say in the article that she thinks a threshold of $35,000 is a better place to start. Most people agree an increase is needed, but a smaller step should be taken.
Unfortunately there is still more waiting we must do until we know which direction this regulation will take. In the meantime, keep those plans ready because you never know what will happen next.
I recently attended Governing’s Outlook in the States & Localities Conference in D.C. to continue my own education on the public workforce and how it’s impacted by current events. I would equate the abundance of info to watching the news of the past year in fast-forward. It is quite overwhelming. But every year I come back to this event because its where you’ll find the best info.
I was disheartened, but not shocked, to hear 2016 will even further stretch resources including the work done by our public servants as in years past. As the topic of labor was danced around, but not quite addressed, the mere mention of rising costs of healthcare (2016 HHS spend in state & local government to increase 5-6%) and pensions (currently a $1T shortfall in state & local government) will no doubt keep hiring at low levels. And by low levels, they mean from as far back as 2009. According to Governing, local governments have fared the worst with this steady decline in employment.
A shortage of employees at any organization hurts. Yet in government it has an added sting, because the people who really suffer are those who need it most. As long as programs can’t be run due to a lack of resources, and there are citizens who rely on these services, it will continue to create a negative effect on society. Scrutiny around operational inefficiencies within government will continue to grow and could even cause some distrust.
Let’s make 2016 the year we take a deeper look at costs, including labor, and find ways to bring some of our programs back.
Last year we had 45 ‘Major Disaster Declarations’ in the U.S. according to FEMA. Sure the number fluctuates each year, but the reality is you can’t predict when or where an emergency is going to hit a community. And it doesn’t matter which part of the country you live in. Maybe you don’t live in a region where you’ll ever experience a hurricane or a tornado, but flooding is the #1 natural disaster in the U.S and all 50 states have experienced floods or flash floods according to Floodsmart.gov.
With this information alone, it makes sense for states, cities, and counties to have a plan should a disaster strike, right? Many government organizations do have a plan that includes addressing the safety of the public and responding to the immediate need. All things that are extremely important when confronted with an emergency. But what about the after-math? What about the months or years of recovering and rebuilding? Or the resources and manpower to make all this happen? And the budget; how do you allocate funds to cover costs? Being prepared isn’t just about the initial response to an emergency, but should include what it takes to track the recovery efforts and maximize reimbursements from funding agencies.
Labor costs are a large operational expense for any government budget, but throw in an emergency and now these costs grow exponentially. Once an emergency moves to a FEMA declared disaster, now the pressure is on to track every penny of what is spent on clean-up and recovery efforts. FEMA has some pretty strict requirements for labor costs associated with emergency work under Recover Policy 9525.7. What if government agencies accounted for this level of tracking ahead of a disaster by identifying efficient labor tracking methods in their emergency preparedness documents?
Take what the City of Houston did for example. The city put together a Finance Disaster Recover Manual back in 2013. So when the floods hit Houston back in May and Harris County was FEMA approved for Federal Disaster relief funding, you can bet they pulled up their recovery manual and began tracking according to their pre-laid plans. All duties associated with recovery will be coded and tracked to get as much funding from various agencies as possible.
Although a municipality may never recoup all money spent, there is no excuse for leaving money “on the table”. Tracking with paper or spreadsheets leaves governments open to a loss of funds due to inadequate tracking, miscalculations, and delays in report gathering. Prepare your organization to not only recover safely through an emergency, but also financially.
To me, the term “Smart City” always felt like a fictitious phrase made up by someone in marketing. I’m probably more cynical than most since I come from the marketing world, but I wondered how you could debate a city was smart or not. And does that mean the other cities are dumb? No, of course not, but as I’ve researched this topic I have noticed that some cities do exemplify the definition of Smart Cities. Yes, there is a Wikipedia page devoted to this. In short, the term refers to the creation of knowledge infrastructure through technology and data.
Last month I attended the Smart Cities & Counties Summit put on by the Public Technology Institute (PTI). They put on a great conference and gathered some outstanding cities and counties to come together for best practice sharing. At that point, I got to really understand why the term “smart” was used. Topics included 311, GIS, fiber optic broadband, transportation, etc… But from the topics were overlying themes of efficiency, collaboration, and an overall goal of wanting to build a better community. So for a city to be “smart” it doesn’t just adopt new technology and say “we are cutting edge”, it uses technology alongside people to look for ways to grow. Here are just a few of the cities that presented on their initiatives at the summit:
- City of Minneapolis is using analytics and data to make better decisions across departments and better coordination of city operations.
- City of Charlotte is building solutions to connect the city and it’s citizens with sites like Open Charlotte and the Code for Charlotte Brigade complete with it’s own hack-a-thon.
- City of Columbus is working with academia and businesses to conduct research on sustainability and economic development.
Workforce development was another element of Smart Cities that found its way into the conversations. After all, what is a city without its employees delivering services and its citizens being part of a workforce to stimulate the economy? Smart cities (or any city for that matter) are seeing a new generation come in with different skill sets while an older generation makes plans for retirement. Workforce development plans proactively look for ways to bridge this gap and transfer knowledge to move forward with succession efforts. Technology can play a role in this by way of educational/training tools, workforce management solutions, and talent acquisition.
So, this brings us back to question, ‘Is having a smart city important?’. Some will argue that it is subjective so therefore the title is up for grabs for any city who deems themselves worthy. I say, the smart city title is important, but only if the ultimate goal is bringing government and it’s citizens together. So far, I like what I see.
Today’s blog is from Don Pagel, VP Public Sector Services at Kronos.
Big Data, Data Warehousing, Data Marts, Analytics, Business Intelligence….all are part of the same evolution of the growing digital world, the data it generates and the structured information contained therein.
As computer systems began to house databases of transactional data, users and executives have asked for more and more “reporting” from those systems to investigate problems, maximize efficiencies within processes, and my favorite in the public sector, or determine solutions or answers based on factual information rather than supposition or anecdotal experiences. In recent years the data generated by all of the systems we use and the potential interrelated information from disparate systems has generated voluminous amounts of data…thus “Big Data”.
The public sector is beginning to use analytical tools to mine all of the data they have to inform their constituents, look for efficiencies and also to help off-set some political “agendas” by focusing on facts. Public safety organizations use collected data to look for geographical or date-specific trends to help staff for the best use of safety manpower as well as educate the public on what is going on in their areas. Human resource departments regularly extract and update public pay and benefits data to reduce demand on their staff for public information requests. Executives are finding value in workforce management data to determine labor productivity and improve resource and budget management. Finance departments are unifying all of their collections data into one analytical format from disparate systems in order to gage how well they are collecting outstanding fines and fees, develop metrics to monitor and look for ways to enhance processes to improve collections. Parking and Police departments are collaborating on vast amounts of data collected by license plate recognition equipment and software to share information that can be valuable to both organizations. Parking departments are also learning the value of parking transaction data for both numerous supply and demand calculations as well as justifying new garage or meter placements. Traffic managers have long used data to determine traffic patterns but now can use that same data to automate lane use or determine where the next road work or expansion is necessary.
Putting some thought into structuring data within a larger organization that may contain multiple systems can lead to an easier delivery of many of the above ideas, allow for “drill-down” structured online reporting as well as simpler ad-hoc querying to more easily find true factual information in a political environment. This is not generally an inexpensive project, but it can pay off handsomely for years to come. If your organization hasn’t started a Big Data project, I suggest you consider the following:
- Take an assessment of all of the different important systems you have and determine their purpose.
- What data is being stored on each system?
- Are their proprietary analytic programs already on a system that can be used to export data to a larger environment?
- Is there an opportunity in an external database to link these disparate data sets together? Over time, you may initiate some data normalization of different systems in order to link data easier.
- Now that you have a data storage strategy for your important data, what are your current pain points that you most want to solve with data? Start small or start focused on just those pain points. There will be a tendency to over-develop analytics that may or may not be useful. Since you spent time up front on your data storage strategy, you can build them as needed so they have the greatest impact and potential use by your organizations.
- Develop a plan to use the analytical tools developed in a structured way or using a process. In other words, don’t just make them available, develop a process or policy for their use.
- Use dashboards that are visible to wide audiences so that there is a natural draw to the information as well as a natural desire to improve the results. Visibility can create powerful competition.
- Develop education around the data being displayed. Don’t assume that others will know what the data is saying or how to use it to improve results.
In short, Big Data is collecting the vast amounts of data we have and putting it to good public use. You have the data, it’s a shame for it to go to waste
Today’s guest blogger is Don Pagel, Vice President, Public Sector Services at Kronos.
“If you always do what you’ve always done, you’ll always get what you’ve always got.”
― Henry Ford
Henry Ford changed the world when he created an entirely new process to manufacture cars. The assembly line created new efficiencies in all areas of manufacturing and ushered in one of the most dramatic economic booms in human history. The fear of the workers was that this increase in efficiency would reduce the need for labor. What actually happened was that efficiency made the dream of car ownership within the grasp of the common man and the increase of purchasing power also increased labor demand.
Change is most difficult before the benefits of change are realized.
Implementations of workforce management technologies can often be feared because of the change it creates in the everyday life of both the employee and the manager. The employee often fears that the requirements of “punching a clock” can restrict their freedom until they experience the value of visibility and the importance of fairness of adhering to the Fair Labor Standards Act (FLSA). Managers fear being treated like a “timekeeper” until they realize the benefits of becoming true resource managers and the ease visibility gives them into controlling budgets and employee favoritism.
Fear of change can be overcome by increasing the across-the-board fairness that both a workforce management system can offer coupled with unifying policies to ensure both fairness as well as compliance with the Fair Labor Standards Act.
When implementing any new system, the temptation is to force the system to do “what you have always done”, thus eliminating the potential gains it can offer.
Public Sector Challenges with the FLSA
The Fair Labor Standards Act was signed by President Roosevelt in 1938 in response to ongoing employee abuses of the Great Depression. For decades after the passing of this important legislation, state and local governments were considered exempt from it. A number of important legal cases from the 1960’s through the 1980’s were brought before the US Supreme Court. Finally in 1985, Garcia vs. San Antonio Metropolitan Transit Authority  settled the issue when the court made adjustments in FLSA for compensatory time and the unique needs of peace officers. These changes finally held most government agencies accountable to the amended act.
Many government agencies today still struggle with being compliant with the FLSA. The concept of “Exception Pay” or “Pay from Schedule” is still the common practice. Because of this, the Department of Labor (DOL) has stepped up audits of government agencies due to increased complaints from employees and unions alike. The DOL has also created a tool for state and local government agencies to do a “self assessment”.
Implementing a workforce management system is a perfect opportunity for state and local governments to re-evaluate their policies and procedures to unify policy and ensure compliance with the FLSA. Missing this opportunity will only lead to increased struggles later to enact policies that protect both the employees and the employer. Using a best practice procedure of “Positive Pay” for all non-exempt employees ensures full compliance with the FLSA through accurate documentation of hours worked. This must also be backed up by policy in order to not only ensure fairness but also reduce challenges to civil service courts and union leadership.
 469 U.S. 528 (1985)