Staffing Agency Insurance: Government Investigates Payroll Violations

Staffing Agency Insurance Government Investigates Payroll Violations

Staffing Agency Insurance: Government Investigates Payroll Violations

One of the top priorities of the Obama administration has been labor reform, including better regulation and enforcement of existing legislation. Government investigations into labor practices and wage violations have been historically low during the last few presidencies; however the U.S. Department of Labor (USDOL) has recently increased their examination case load. Recent studies from the USDOL reported that 71% of surveyed West Coast restaurants were found to be in violation of fair payroll and wage practices. Wage theft and payroll violation incidents were also found in ninety-three percent of surveyed garment manufacturing companies. Wage-theft is the catch-all term for payroll abuse and violation of fair wage practices, which not only hurts employees but can cause costly revenue losses for the government. Improperly reported wages can generate incorrect tax reporting and huge losses of tax revenue. In cities such as New York, Chicago, and Los Angeles, workers have lost $56.4 million per week in labor law violations.

The U.S. Department of Labor noted construction, garment manufacturing, foodservice and home healthcare as the top industries to report payroll violations. Seventy-six percent of employees who worked over 40 hours experienced unpaid or underpaid overtime situations. Sixteen percent of workers were uncompensated for “off the clock” work, leaving thousands of employees overworked and under paid for their efforts. The investigations often lead to legal challenges for companies found to be in violation, yet workers rarely see lost wage recovery even when they are awarded judgments in their favor. Small businesses are the largest offenders of payroll violations, however many big companies have been implicated as well. As such, it is often hard for employees or former employees of a small company to recover their losses because little operations go out of business or cannot afford to pay out the reimbursements.

While the best business practices are fair wage distribution, occasionally mistakes occur as a result of misunderstood regulations or other policy mishaps. Obtaining comprehensive Staffing Agency EPL Insurance is essential to ensuring that staffing agency is covered in the event that allegations of unfair wage practices are brought upon them. At World Wide Specialty Programs we provide coverage to staffing firms for their in-house employees and for their contract workers, placed with clients who are subject to the client’s workplace environment. Our comprehensive Staffing Agency Insurance plans are specifically designed to navigate all the challenges faced by members of the staffing industry. We also offer Staffing Agency Workers Compensation and an array of other policies. Give us a call today at (877) 256-0468 for more information about all our Staffing Agency Insurance coverage offerings.

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