Even if you’re super small, it’s essential to keep your finger on the pulse of HR compliance. Here is a beginner’s guide that will help make sure you stay up-to-date with industry changes and regulations. To guarantee HR compliance, businesses must adhere to labor and employment regulations. You are managing people following these regulations, on the other hand, may be incredibly difficult. HR compliance is something that all company owners and HR staff should be aware of, as well as how to manage it. You must understand the nature of compliance and manage it throughout the organization. After all, any HR staff needs structured techniques for a startup or a well-established company.
What Is HR Compliance and How Does It Affect You?
Defining policies and procedures to build employment and work practices that indicate a full awareness of relevant laws and regulations is part of HR compliance.
With the growing number of employment rules and regulations, the danger of incurring expensive fines and penalties for non-compliance has never been greater. HR complications are becoming more complicated for organizations of all sizes, which is why firms and company owners should be aware of certain factors while implementing HR policies and processes, such as:
- Whether they’ll be audited by a law enforcement body capable of imposing fines and penalties for non-compliance.
- It’s common knowledge that failing to comprehend compliance duties isn’t a valid legal defense.
- Being aware that settling a case might result in bankruptcy
- Recognizing the restrictions that must be observed in the workplace, including federal, state, and local requirements
To put things in perspective, no matter how big or small your firm is, prompt and proactive compliance with all relevant employment requirements is vital. In addition, because of the rising frequency and extent of government agency audits, you should take an active interest in complying with the ever-changing regulatory requirements. If you don’t, you’ll have to cope with the negative repercussions of non-compliance.
HR Compliance Fundamentals
There are seven types of employment rules, and you’ll need an HR process for each one to establish and implement HR compliance. In addition, of course, new restrictions will apply as your staff expands, which is why you’ll need to change your policies over time to be compliant.
Discrimination
The Equal Pay Act (EPA) and the Immigration and Nationality Act (INA) are two federal HR laws that protect all workers from discrimination (INA). The Equal Pay Act safeguards you against salary discrimination based on your gender or sex. The Hart-Celler Act, generally known as the Immigration and Nationality Act, protects workers against discrimination based on citizenship or national origin. Employers with more than 14 workers are required to follow Title VII of the Civil Rights Act, the Genetic Information Nondiscrimination Act (GINA), the Pregnancy Discrimination Act (PDA), and the Americans With Disabilities Act (ADA) (ADA). If your company has 20 or more workers, you’ll be subject to the Age Discrimination in Employment Act’s regulations (ADEA). TThese laws aim to prohibit employers from discriminating against employees based on their race, color, religion, sex, nationality, genetic information, impairments, or age. Employees who make discrimination complaints are also protected against being dismissed or penalized due to their allegations, a practice known as retaliation. These regulations cover a broad range of HR activities, including recruitment, screening, hiring, promotions, benefits, salary, retirement, and leave. Because anti-discrimination laws touch a variety of HR operations, you must be aware of your rights and responsibilities under these laws and ensure that your managers follow them.
Wages and Hours of Work
Employees are protected by federal legislation from working in inhumane circumstances. The Fair Labor Standards Act (FLSA), which establishes the minimum wage and standards for overtime pay, recordkeeping, and other issues, covers the majority of this legislation. The FLSA is enacted by the United States Department of Labor (DOL) and applies to all workers in the United States. At the same time, local wage and hour rules exist in several states and municipalities. For example, the minimum wage in the District of Columbia and 29 conditions is more than the federal minimum wage of $7.25 per hour. Salaries and hourly rates impact HR functions such as scheduling, payroll, and independent contractor recruiting. Therefore, I strongly advise you to use advanced HR software to streamline HR processes and make them more efficient and time-consuming.
Immigration
Employers may only recruit qualified employees, including U.S. citizens, nationals, and anybody else who can lawfully work in the United States, according to the Immigration Reform and Control Act (IRCA) and the Immigration and Nationality Act (INA). Employers must also complete and keep track of I-9 forms for all workers, which verify employment eligibility.
Employee Vacancy
The Uniformed Services Employment and Reemployment Rights Act (USERRA), which protects employee positions after military service, applies to all companies. Employers with more than 50 employees are also covered by the FMLA, which permits employees to take up to 12 weeks off for reasons such as the birth or adoption of a child, sickness, or illness of a child, parent, or spouse. The legislation also allows for up to 26 weeks of military caregiver leave, during which time the firm must continue to cover the employee’s group health insurance as if they hadn’t taken leave. Although paid leave is not required under the USERRA or the FMLA, employers must enable employees to return to the same or a similar work when they return from vacation. They must also avoid discriminating against them or retaliating against them.
Administration of Benefits
Employers must preserve sensitive employee health information and genetic information under the Health Insurance Portability and Accountability Act (HIPAA) and the Genetic Information Nondiscrimination Act (GINA); GINA also establishes criteria for health insurers that ban them from discriminating based on genetic information. An insurer, for example, cannot make workers submit to genetic testing to be eligible for their healthcare coverage. If you provide group health insurance or qualified retirement plans, you must guarantee that they fulfill the Employee Retirement Insurance Security Act’s minimal criteria (ERISA). A qualifying plan, such as a 401(k), permits workers to postpone income taxes (k). Benefits accrual and funding, vesting, and plan managers’ fiduciary obligations are covered under ERISA. Businesses must also comply with the Affordable Care Act (ACA) and provide all required data to the Internal Revenue Service (IRS). Companies with at least 50 workers must either provide health insurance or pay an employer shared responsibility payment to the IRS under the Affordable Care Act. Those with at least 20 workers must comply with the Consolidated Omnibus Budget Reconciliation Act (COBRA), which permits departing employees to keep their health care coverage for a certain period of time. According to the Mental Health Parity and Addiction Equity Act, 50 workers must guarantee that mental health and substance abuse treatment treatments are treated equally under their healthcare plans (MHPAEA).
Safety
At work, employees should be safe and healthy. The Small Business Handbook of the Occupational Safety and Health Administration (OSHA) includes a template to assist firms in launching workplace safety programs. These rules are in place to ensure that everyone stays safe and unharmed. Having rules and safeguards prevents minor problems from spiraling out of control. It also prepares you for more serious threats such as fires, tornadoes, and armed attacks.
Rights of Trade Unions
Finally, consider union rights, protected by the National Labor Relations Act (NLRA), which gives workers the ability to create, join, or refuse to join unions. It also ensures that workers have the right to meet and discuss working conditions, including on social media sites such as Facebook and Twitter.
4 Ways to Boost HR Compliance
A successful HR compliance plan necessitates the use of the appropriate technologies. I’ve gathered a list of some of the most significant sorts of compliance tools below.
1. Software for HR Compliance.
This program works by keeping organizations, managers, and HR executives informed about company policies and applicable compliance legislation. HR compliance software technologies make it simple for organizations to stay up to date on the newest local, state, and federal compliance laws and regulations. They also aid in communicating with new and current workers and enforcing corporate rules. BambooHR is an example of HR software that includes features such as sophisticated reporting, payroll, onboarding, benefits, and an easy-to-use interface. It’s perfect for small and medium-sized enterprises, and you can get a free pricing quotation right now. 
2. Software for Onboarding.
Onboarding software solutions make it easier for recruits to get started. When recruiting managers and HR specialists, they reduce any unneeded administrative labor. Additionally, both the employee and the hiring manager will keep better track of onboarding materials and documentation to assure compliance.
3. Software for Benefits Administration.
Benefits administration software enables businesses to develop and manage employee benefits packages while adhering to regulatory rules. In addition, they assist businesses of all sizes in remaining compliant with local, state, and federal legislation such as the Affordable Care Act (ACA) and the Health Insurance Portability and Accountability Act (HIPAA).
4. Software for tracking time and attendance.
HR departments use time and attendance software to make time tracking simpler. These solutions are meant to keep track of vacation time, holidays, overtime, and sick days while managing business time and attendance data.
4 HR Compliance Strategies
Let’s look at some HR compliance best practices to reduce mistakes and increase outcomes.
1. Hire the Right Human Resources Personnel.
Every company is different, so having a customized HR support staff is critical. Your HR department should be efficient and well-informed. Fortunately, depending on the size of your company, your HR requirements, and your budget, you have numerous alternatives for creating one. You may engage an internal HR manager or outsource HR duties to a professional employer organization, for example (PEO). Make sure your HR is in good hands, regardless of your choice.
2. Ensure that all policies and procedures are documented.
If you believe something is critical to your company’s performance, make sure it’s stated in your employee handbook. The goal is to create an employee handbook that covers all the regulations and procedures that workers must follow. Although documenting rules may seem to be a daunting task, it may dramatically improve your day-to-day operations. Once you’ve written down your processes and regulations, you may adjust them overtime to get the most significant outcomes. Keep in mind that you’re working on an existing document. As a result, any processes and regulations you create should be revised on a regular basis as circumstances change.
3. Employees should be educated on HR compliance.
Setting up a set of compliance standards and processes isn’t adequate, even if it is successful. To maintain team compliance, you must encourage open communication with your staff and instruct them on your rules. Depending on your team and the subject, the sort of employee training you provide will vary. It may be done in person or online, and it can be handled by your HR department or a third party. For example, rather than an internal HR staff, external parties should undertake anti-harassment and anti-discrimination training.
4. Disciplinary Actions Should Be Enforced Across the Board.
When an employee files a complaint or is found guilty of non-compliance, you must conduct a comprehensive investigation. Once you’ve completed your research and established that an employee has broken a corporate policy, you must take the proper disciplinary action as provided in your employee handbook. Human resource compliance requires that all workers be treated fairly and equally. Because of their position or favoritism, no employee should get preferential treatment or be “let off the hook.” Enforcing disciplinary action will also keep your organization out of court.
Conclusion
Once you have a system in place to guarantee HR compliance, you must strive to maintain it. Organizations must constantly anticipate and address difficulties proactively while adhering to ever-changing rules and regulations. On the surface, HR compliance seems limited to following practices and standards mindlessly. However, if you go further, you’ll discover that they impact employee experiences as well as the workplace as a whole.
Frequently Asked Questions
How do I become HR compliant?
A: You can become compliant by signing the employment contract.
What is the HR compliance approach?
A: The HR compliance approach is the process of doing everything in your company to make sure that there are no violations of human rights laws. It includes ensuring that employees and contractors do not discriminate against any person due to their race, gender, nationality, religion, or sexual orientation.
What are the three most essential HR laws?
A: The three most essential HR laws are the Equal Pay Act, Age Discrimination in Employment Act and Title VII.
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