American Woodmark Leverages Kronos to Reduce Absenteeism, Control Labor Costs, and Improve Leave Compliance

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American Woodmark Corporation is a fully integrated just-in-time cabinet manufacturer that offers approximately 400 cabinet lines in a variety of designs, materials, and finishes. The company operates 11 facilities — including one union plant — in Arizona, Georgia, Indiana, Kentucky, Maryland, Tennessee, Virginia, and West Virginia, as well as nine builder centers across the country. Of the corporation’s nearly 3,500 employees, approximately 2,500 are hourly, including 350 union employees. Products are sold through a network of independent distributors and directly to home centers and major builders.

Managers at the company’s original facilities wanted autonomy in setting workforce rules and policies. As the company grew, this situation grew increasingly challenging. A mix of stand-alone manual and automated workforce management solutions didn’t provide the corporate office with real-time visibility to key labor measurements at individual locations, and the data wasn’t always correct. As American Woodmark considered a centralized system for its entire workforce, it discovered inconsistencies in work and pay rules, overtime rules, accrual granting, and attendance point assessment. Overcoming these issues and achieving workforce efficiencies became central goals in selecting an automated solution.

The company wanted a solution that provides flexibility, implementation support, and value and selected the Kronos® Workforce Central® suite. “We haven’t performed an ROI on this project, but we feel certain we are controlling costs through more efficient tracking of all paid time off, are monitoring leave cases better, have a better handle on hourly employees, and are truly paying them for actual hours worked,” says Terri Wermter, HR systems administrator. “We also have across-the-company consistency in our pay practices now as a result of implementing Kronos.”

Centralized solution delivers consistency and visibility to control labor costs

Absenteeism has an enormous impact on the shop floor at American Woodmark, where scheduling is important to the delivery of just-in-time products. Having absent employees can require payment of overtime to other employees to ensure on-time product delivery. Absentee and tardy policies that varied by location and manual tracking of plant employee time and attendance — both time-consuming and often inaccurate — aggravated this situation at American Woodmark, says Wermter. Manual tracking with paper attendance calendars also could take more than an hour a day at each plant.

“One of the biggest advantages of Kronos has been our ability to standardize the attendance policy for all locations,” she notes. “Employees know there is an attendance policy with a hard and fast attendance point number that cannot be exceeded. The accuracy and timeliness of attendance points has had a significant impact on our organization, as has the fast generation of corrective action documents.”

The centralized Kronos solution has provided better visibility of absenteeism rates by location and across the company, as well as improved attendance policy enforcement to better control labor costs. American Woodmark has seen a significant decrease in the number of absences per employee, and its union facility has experienced a huge drop in its absence rate, with absences now tracked more accurately.

In addition, in the event of a complaint for unlawful termination, the company can use the Kronos data to show the employee’s history of attendance infractions, as well as demonstrate that the employee’s supervisor discussed attendance-related disciplinary action.

Accurate time-off and leave management minimizes compliance risk

The accuracy of accrual balances was another issue prior to Kronos. Vacation and sick time of salaried employees was tracked manually by managers, as was vacation time for hourly employees. This tracking system was often inaccurate, giving these employees unnecessarily high leave balances and payouts when they left the company, says Wermter. With Kronos this no longer occurs, and the company now has accurate accruals data for financial reporting.

American Woodmark also encountered problems with locations manually tracking federal- and state-required employee leave, such as that under the Family and Medical Leave Act. Accurately tracking leave time by hand was a logistical nightmare made worse by leave information being manually entered into the company’s HR payroll system. Now, Kronos automatically shares information in Workforce Absence Manager with Cyborg, the company’s payroll system.

“The Kronos leave module has helped us be very compliant with FMLA laws and makes sure we’re marrying up what our payroll system has for employees’ leave time and benefits with our Kronos system,” explains Wermter. “It has proven to be a good tool and identifies when employees are on unpaid leave so we can be sure to collect insurance premiums from them. Pre-Kronos we probably paid for benefits that employees weren’t entitled to, because they were on unpaid leave but we didn’t realize it.”  

Streamlined time-off request process, increased employee satisfaction

Having immediate access to accurate accrual balances has also improved the time-off request process. Before, hourly employees submitted paper requests to their supervisors, who had to obtain the accrual balance from Payroll before approving the request. Now, employees can view their accrual balance on their timecards and request time off via self-service at Kronos 4500 terminals. Supervisors have instant access to the employee’s accrual balance and scheduling information, so requests can be acted on quickly.

“Employees have the ability to see this information, which helps them feel more comfortable that their time is being paid correctly,” says Wermter.

Timely access to accurate workforce information has increased employee satisfaction on many levels, she adds. And, as American Woodmark looks ahead, the company plans to implement the Kronos Workforce Scheduler™ application to further improve its workforce management.

American Woodmark Summary

Employees: 3,500

Industry: Manufacturing

Products:

Workforce Timekeeper™
Workforce Absence Manager™
Workforce Record Manager™
Workforce Connect™
Workforce TeleTime®
Kronos 4500™ terminal

PROJECT BENEFITS

• Standardized attendance policy and centralized enforcement significantly reduces absenteeism and controls labor costs 
• Accurate leave tracking improves compliance with state and federal leave regulation
• Easy access to accrual balances increases productivity and enhances employee satisfaction
  

“[With Kronos] we are controlling costs through more efficient tracking of all paid time off, are monitoring leave cases better, have a better handle on hourly employees, and are truly paying them for actual hours worked.”  —Terri Wermter, HR Systems Administrator

Kronos Incorporated 297 Billerica Road Chelmsford, MA 01824 +1 800 225 1561 +1 978 250 9800 www.kronos.com
More information about Kronos customer success stories may be found at www.kronos.com/resources .

©2010, Kronos Incorporated. Kronos, the Kronos logos, Workforce Central, and Workforce TeleTime are registered trademarks, and Workforce Timekeeper, Workforce Absence Manager, Workforce Record Manager, Workforce Scheduler, Workforce Connect, and Kronos 4500 are trademarks of Kronos Incorporated or a related company. All other product and company names mentioned are used for identification purposes only and may be the trademarks of their respective owners. All specifications are subject to change. All rights reserved. 229830-115103.