What Is HR Compliance?
Why HR Compliance Can’t Always Be Assured
Some employment laws take the form of “Do this” or “Don’t do that.” The requirements may be simple, like minimum wage, or complex, like FMLA, but either way there’s usually no real question about what you need to do or not do. Compliance with these laws is pretty straightforward. Don’t pay less than the minimum wage. Provide leave to eligible employees for the reasons that qualify, continue their health benefits (if applicable), and return them to their position when their leave ends. As long as you’re clear on the details, you’re not likely to lose sleep wondering if your policies and procedures are compliant.
Sometimes, however, those details are unsettled. Lawmakers don’t always specify everything a law requires before it passes or takes effect. Even when laws seem clear, trying to put them into practice often raises a lot of questions. And the legislature isn’t the only source of law: regulatory agencies demand their say, and courts get involved, too. To complicate matters, these branches of government don’t always agree with each other, and what they say today may not be what they say tomorrow. Keeping up with the latest official guidance takes time and persistence. It can feel like a marathon, when what you want is a quick sprint to the answer. You have other demands on your time, after all.
Finally, a lot of employment laws have standards you have to follow, but they don’t tell you how. Neither the IRS nor the DOL, for example, tells you whether your workers are employees or independent contractors—unless there’s an audit or complaint. Instead, these agencies publish tests with general criteria that you use to make case-by-case determinations.
The Americans with Disabilities Act (ADA) works this way, too. Under the ADA, an employer is required to provide reasonable accommodations to employees with disabilities, with a few exceptions. One of the exceptions is that the accommodation doesn’t create an undue hardship on the employer’s business. The basic definition of an undue hardship is an action that creates a significant difficulty or expense. Although the law provides factors to consider in making this determination, the onus is on you to decide whether an expense or difficulty from an accommodation is significant. And, ultimately, your conclusion could be challenged in court.
First, when you’re assessing your compliance obligations, understand that not all compliance obligations are clearly delineated or settled law. Unsettling as that may be, it’s how our system has been set up. In those cases, you’ll have to weigh your options and the risks involved, and then make a decision. Sometimes you may need legal advice in addition to HR guidance. Remember, though, that despite all the many employment laws on the books and in the imaginations of legislators, the system is designed to keep employers in charge of their work and workplaces. You can’t eliminate all risk, but by understanding the nuances and open questions, you can significantly minimize it.
Second, document your actions and decisions. It only takes an employee filing a complaint for enforcement agencies to get involved, but you are better protected if you can quickly and clearly explain to them the reason for your actions.
Third, evaluate whether your policies, procedures, and practices are satisfactory to employees. No employment law gets written in a vacuum, and no law is truly inevitable. The Fair Labor Standards Act came to be because workers and the general public felt that labor standards were unfair. Today we wouldn’t have people pushing for predictive scheduling laws if they felt that work schedules were already sufficiently predictable. Harassment prevention training wouldn’t be mandatory (where it is) if sexual harassment weren’t widespread.
Fourth, lead by example. Make good employee relations a key part of your brand and competitive advantage. Employees have higher expectations today than they used to. Meet those expectations and motivate other employers to do the same, and you may find that the compliance landscape of the future is less winding and boggy than it could have been.
Finally, spend some time each day here on our HR Support Center to learn about your compliance obligations. Our laws section breaks down federal and state employment laws in a way that laypeople can understand, and the News Desk keeps you up to speed on the latest compliance obligations and contingencies you should consider. HR compliance is an art, and the first step to mastering it is learning what it entails and how it works.
If you have any further questions about HR compliance or want to learn how you can utilize Abacus Payroll to outsource your business’ HR, contact an Abacus Payroll advisor today!