Why We Don't Do Payroll Audits - Reason 7
Wednesday, 02 September 2009 11:48

Written By Larry Beebe
Bond Beebe
P: 301.272.6025 E: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

“Our Management Trustees Don’t Want us to Audit Employers”

Many years ago, I did my first payroll audits for a plan in the construction industry.  The employers had never been audited before, and I had numerous findings of unreported hours.  I knew that the union trustees would want to take immediate action to collect the amounts due.  What I found surprising was that the employer trustees were equally vigorous in wanting to pursue the delinquent amounts.  When U expressed my surprise to a management trustee, he explained:

“I pay the proper wages and fringe benefit contributions for all of my employees.  The employer who is not paying what he should has a competitive advantage over me in binning on new work.  And to make matters works, if that employer does not pay his fringes, then the plan has to ultimately collect even more from the honest employers.”  To sum it up, the trustee added: “I don’t mind competing with an employer who is honestly paying and reporting what he owes, but I don’t want to compete against an employer who is not paying what he owes.”

I have found that the majority of employers support a vigorous payroll audit program.

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written by Chuck Nichols, September 08, 2009
We recently were approached by a new client who was interested in our services for a routine payroll audit program. They had never had one before, believing that all of their contractors were paying properly. On our first pass through their employer list we found many significant issues. Most were misinterpretations of the collective bargaining agreement. The trustees were lulled into complacency due to the fact that there were no significant delinquency issues. All contractors paid on time, but we found that they were not all paying according to the contract and the trustees were stunned to see the amounts that were being billed on their behalf.

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