Four tough questions arrive in our Payroll mailbag — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Four tough questions arrive in our Payroll mailbag

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in Office Management,Payroll Management

This month we return to Las Vegas and the American Payroll Association’s 33rd Annual Congress to cover questions fielded by reps from the Department of Labor.

Are there priority rules for voluntary deductions?

Question: Are there any federal guidelines governing the priority of deductions when gross pay is insufficient to cover all deductions? Specifically, where do medical/dental plan deductions and 401(k) deferrals fall in the priority order?

Answer: Unless you’re talking about garnishments, there are no federal rules governing voluntary deductions. Wage and hour investigators look for illegal deductions only.

 

Time keeping for exempts—required or not?

Question: Is there a rule that specifies whether we should have exempt employees complete time cards, even if they just put down eight hours a day?

Answer: No. Time keeping for exempt employees isn’t required, so it doesn’t matter what hours they write on their cards. The issue arises, however, when a nonexempt employee has been misclassified as exempt. In that case, you will have problems, if you don’t have an accurate record of the hours the employee worked.

 

How do new technologies affect record retention?

Question: As companies move to electronic scanning and storage of documents, are there any documents that must be retained in their original form?

Answer: Yes. Employees’ time records must be retained in their original form.

 

Can nonexempts legally change their time sheets?

Question: Are there any best practices when it comes to allowing nonexempt employees to correct their own time cards? How does this affect the audit trail?

Answer: A best practice is to ensure that they make corrections timely. A red flag for investigators is the frequency with which employees’ time cards are changed.

 

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