The labor-law responsibility your payroll provider won't take
An ABA practice owner who went looking for help payroll vendors disclaim
This is the story of an ABA practice owner who went looking for something most vendors quietly refuse to own: help staying on the right side of labor law. We've kept them anonymous, but what they found when they started asking will surprise a lot of owners — and the exposure it points to is bigger than most realize.
The discovery: the buck stops with the owner — even when payroll is outsourced
The owner assumed, reasonably, that their payroll provider had labor-law compliance covered. So they asked. Then they asked another. The answer, in different words each time, was the same: payroll services process pay — they do not take responsibility for whether the practice is complying with wage-and-hour and other labor laws. That responsibility stays with the employer.
Once you understand how payroll services work, it makes sense. They calculate pay from the hours you give them — so a paycheck is only ever as accurate as the hours you hand over, and getting those right is your responsibility, legally. The provider that runs the paychecks is not the party on the hook if the underlying hours, overtime, or recordkeeping are wrong. The owner is — and under wage-and-hour law, owners and managers can be held personally liable, with penalties, back pay, and liquidated damages that can double what was owed.
Frequently asked questions
Doesn't my payroll provider handle labor-law compliance?
This is the surprise that started this story. The owner called around and got the same answer every time: payroll services process pay — they do not take responsibility for whether you're complying with wage-and-hour and other labor laws. That responsibility stays with the employer, even when payroll is outsourced.
What labor-law risk am I actually exposed to?
In a practice full of part-time, hourly, often-mobile staff, the underlying records — who worked when, for how long, overtime, and meal/rest breaks — are where things get messy. It isn't only unpaid hours: many states penalize missed or interrupted breaks, sometimes a full hour of premium pay for each one, and breaks are routinely skipped when a tech can't leave a client mid-session. If hours and breaks are reconstructed loosely at pay periods, you can't confidently answer basic questions or produce clean records if you ever have to. The party on the hook for that is you, not the payroll vendor.
How expensive can a wage-and-hour mistake actually get?
Out of all proportion to the original error — which is exactly why owners underestimate it. Back pay can be doubled as liquidated damages, penalties often attach per employee per pay period, lookback periods run multiple years, one underpaid employee can become a class or collective action covering the whole roster, and in most wage suits the employer pays the other side's attorneys' fees too. As one owner put it, just one of these lawsuits can "put your own lawyer's kids through college — and you pay the other side's lawyers too." Exact figures vary by state and situation (a question for your counsel), but the downside is asymmetric, and accurate records are what keep you out of it.
What does Wilma do that my payroll service doesn't?
Wilma strengthens the foundation compliance rests on: accurate time and hours captured as work happens (not reconstructed later), overtime and hours visible to leadership early enough to manage, and clean, exportable records that hand off to your payroll provider and stand up if questions arise.
Does Wilma run payroll?
No — and that's deliberate. Wilma does time/hours tracking and exports to your existing payroll system (the major platforms). She owns the accurate records and visibility; your payroll provider still runs the actual payroll.
Is Wilma giving me legal advice on labor law?
No. Wilma gives you accurate records and visibility — the foundation compliance is built on — but she doesn't provide legal advice or assume your obligations. Labor-law responsibility stays with you as the employer, and you should work with qualified counsel on your specifics. What changes is whether you're flying blind.
How does better time tracking actually reduce my risk?
Compliance depends on records. When hours are captured as work happens and overtime is visible before it compounds, you're managing wage-and-hour exposure on purpose instead of hoping the numbers were right. Good records and clear visibility are the difference between defensible and "we think so."