Are Outdated Files Putting Your Business At Risk?

2 minutes

Imagine this scenario: you terminate an employee. The employee is eligible for COBRA insurance coverage, so your personnel department asks your benefits administrator to send the legally-required COBRA notice to the former employee.

Only it turns out, the address the administrator uses isn’t the employee’s current address. The employee says he notified your payroll department several years ago that they had moved. The problem is, your personnel staff used the old address when they filed the request with the benefits administrator.

So, the employee never receives the COBRA notification because it went to an outdated address. He then sues you for damages because he incurred uninsured medical expenses.

It could happen. In fact, it has happened.

In the ongoing case of Newton v. Prator, that’s exactly what the employee claims. He said he informed his employer of his updated address four years prior to his termination (and has a W-4 and letters from the employer’s health care insurer sent to the new address to prove it). But due to some sort of communications breakdown, the employer’s benefits administrator was given the old address. And the former employee has filed a lawsuit seeking damages and reimbursement for uninsured medical expenses.

In another lawsuit in 2012, a former employee claimed her employer had intentionally sent COBRA paperwork to an outdated address. It seems the employer had two employee address databases — one for payroll and one for benefits. While the payroll database had been updated, the benefits database wasn’t, causing the COBRA paperwork to go to the old address.

A pervasive problem

The same situation can arise in other contexts. For example, there have been several lawsuits lately from workers who were terminated for not submitting information to their employers related to Family Medical Leave Act (FMLA) time off. The employees claim their terminations were unjustified and illegal.

In every case, the employers claim they (sometimes repeatedly) sent requests or notifications as required by the law, while the employees have said they never received anything. Of course, in some cases the employee probably did get the paperwork, simply didn’t return it on time, and is now using the “I didn’t receive it” defense to keep their case alive. But if the employer sent the notifications to an outdated address, the employee’s case has suddenly become much stronger.

How could these sorts of situations be avoided?

One strong defense is a good workforce management system such as AcroTime®.

By maintaining records electronically, AcroTime ensures that paperwork doesn’t get “lost in the shuffle.” Electronic documents are easier to file, store and retrieve than paper copies. With AcroTime Platinum-level accounts, you can even offer employee self-service, allowing workers to review and update their own contact information, benefits elections and more. This saves you even more on clerical time and helps further ensure the accuracy of the information you have on hand.

Single Record, Single Sign-On, Headaches Averted

Most importantly, AcroTime is powered by a single employee record, and uses a single log in to access all modules and features. This means no more worries about out-of-sync databases or communications breakdowns, and no more time wasted entering the same employee information over and over again in multiple places.

Because it uses a single employee record to seamlessly support all modules, any changes made in one area will automatically be reflected across all modules. Choose from Time and Labor Management, Payroll, Human Resources Management, and Scheduling modules — one, any or all, depending on your needs. You can choose to start with one or two modules and add functionality later as your business grows, without ever having to re-enter any employee information! Pretty sweet, right?

Managing employee records is not merely a hassle. It can quickly turn into a legal problem, with all the time, trouble and expense associated. This is just one more headache that AcroTime can solve for you! Contact us today or visit our website for more information or to schedule a demo.

Oh, and always be sure to send important communications with a signature or confirmation of delivery required, not just by regular mail! #JustSaying

Leave a Comment