Human resources compliance is often seen as a necessary but not particularly dynamic part of an overall business structure. Here, Thrive Law & Consulting founder Kate Bischoff, who teaches in Mitchell Hamline School of Law’s online certificate program in human resources compliance, discusses how HR compliance can not only significantly mitigate risk but also advance a company’s mission in fundamental ways.
Human resources sometimes gets a bad rap. We often are considered the people who only say no, the fuddy-duddies at the office party, the ones who are only trotted out when someone is about to get fired. But HR carries some of the biggest compliance issues for any organization, including overtime collective actions and IRS enforcement actions due to the misclassification of workers. These are the types of bet-the-farm litigation that can push an organization to the brink.
But helping to avoid damaging litigation and headlines is not our only function. Properly integrated into the decision-making structure, we can be a key positive contributor to business success in several ways. Consider the following:
HR COMPLIANCE CAN BE INNOVATIVE
Just because HR compliance is a crucial part of minimizing an organization’s risk does not mean it hinders creativity. Strict adherence to the law often looks tedious and mundane, but it doesn’t have to be. We can dazzle employees with easy access to HR services through technology that also eases compliance. While technology can add a bit of risk, it also can help drive compliance. Updating the technology HR uses to manage employee data may be able to keep the data more secure, usable and available when reporting to the governing agencies.
HR COMPLIANCE CAN ENHANCE COMPETITIVENESS
Compliance often mirrors best practices, that can make your business more competitive in attracting talent. Take, for example, the mandatory sick leave laws popping up in cities all over the country, including Minneapolis and St. Paul. For a while now, employers have known that offering paid time off when employees or their family members are sick, has been an important recruitment and retention benefit. Many employers feel it is a necessary part of a competitive benefits package. For some employers, including new and small businesses, the new mandate requires action, but it is also bringing them in line with what their competitors are already doing.
HR COMPLIANCE DOESN’T HAVE TO BREAK THE BANK
Compliance carries a financial burden, but this burden does not have to break the bank for employers already concerned about employee well-being. Yes, new overtime regulations add costs to employers’ bottom lines. Yes, increased minimum wages mean higher labor costs. However, when Walmart raised wages above the minimum wage, taking “better” care of employees, Walmart’s profits increased. Doing the right thing – often the compliant thing – is good business.
HR COMPLIANCE IS A BALANCING ACT
When faced with a compliance challenge, we balance. The strictest, most compliant option is often not the one most loved by business leaders. The noncompliant option could garner the attention of an agency or the wrath of an unhappy employee. Finding a pragmatic solution requires the right mix of ingenuity and knowledge that may require finding the right employment attorney. Good employment attorneys understand both the legal and nonlegal risks the situation poses and can help HR professionals balance the needs of the organization with the potential pitfalls of noncompliance. Rather than saying “no,” we work with you to find the best solution that recognizes the risk and business objectives.
