Written by Kurt Needles
Needles & Associates
P: 303.430.4225 E:  This e-mail address is being protected from spambots. You need JavaScript enabled to view it   

At some time in their career, a payroll auditor will be told by an employer that their company is not signed to a collective bargaining agreement (CBA), even though they are reporting employees. Sounds ridiculous, but it happens a lot. Hopefully the auditor has a copy of the signature page in their file.  This is a good sign that the company is not reporting all hours worked in qualifying employment under the CBA.  The best short-term solution, if possible, is to copy all the payroll information and let the Fund/Union figure out the employer’s status. After the status is determined, the report can be written up. If they are deemed not to be bound, then all hours are over-reported and need to be refunded, up to limits in ERISA, and all hours back to the day their the contract ended, sometimes years, are to be removed from welfare eligibility and pension vesting.

Sometimes action by the employer, the filing and signing of the monthly report, will bind them to a CBA. We encountered one situation where the employer was signatory to a project agreement in 1992, and the key men stayed on with the employer and were reported from that point on.  What further complicated the audit was that in 1992, only a welfare and DB pension fund existed.  Since then, a defined contribution pension and mandatory employer contributions to a training fund were added.  So if the employer is deemed to be signatory due to their actions, would the new contributions be required?

TrackBack URI for this entry

Comments (0)

Subscribe to this comment's feed