HR teams cover a lot of ground – from recruiting and onboarding to employee benefits and performance management to training and development. This list doesn’t even cover all practices and legal requirements HR must comply with and consider.
HR compliance is a key responsibility for managers, requiring them to ensure their organization follows all relevant federal, state, and local employment laws and regulations. Non-compliance can result in legal risks and financial penalties, so it is so important that this task is completed with accuracy and urgency.
If these tasks are completed independently of one another, there is a risk that information isn’t consistent or cohesive between reports and that things may get lost along the way. So, with all these balls in the air, how can HR teams simplify some of their responsibilities into a streamlined, cost-effective approach? Unified HR Compliance is the answer! We're offering up some practical information along with our comprehensive HR Compliance Checklist in this informative post.
What is Unified HR Compliance
Unified HR compliance is an integrated approach to managing an organization’s compliance requirements with a single system. A unified strategy ensures that all compliance elements are connected and managed cohesively, instead of housing these tasks in separate silos.
Here are some key aspects of unified HR compliance:
- Centralized System: Any and all compliance-related reporting, documentation, and processes live in one central system, reducing inconsistencies within data and leading to a more efficient process.
- Regulatory Alignment: Having one centralized system helps to ensure compliance with multiple federal, state, and local regulations.
- Risk Mitigation: Unified HR compliance can proactively help to identify and address compliance gaps before they become a problem.
- Time & Cost Efficiency: By having one central system, you can eliminate the duplication of work, use resources wisely, speed up compliance processes, and minimize the cost associated with non-compliance.
The Risk of HR Non-Compliance
HR compliance is not only a legal requirement but the best choice for your business. If reports are not filed or laws are not followed, you risk both indirect costs, like decreased productivity and reputational damage, and direct costs, like financial penalties, to your business.
Some of risks associated with non-compliance include:
- Legal Penalties and Fines: Non-compliance with anti-discrimination laws or failing to comply with reporting requirements can result in significant monetary penalties for each violation.
- Litigation and Lawsuits: Employees may file lawsuits for things like wrongful termination, wage disputes, harassment, or discrimination. Lawsuits can also arise if it is discovered that you have misclassified workers or have a gender pay gap when looking at your pay equity.
- Reputational Damage: If your organization is found guilty of non-compliance, you risk significant reputational damage which can negatively affect your customer trust and employee morale.
- Loss of Government Contracts: As a federal contractor, you are required to comply with certain laws and reporting requirements. One of the risks of non-compliance is losing government contracts and debarment from future contracts.
- Employee Turnover: If your organization doesn’t comply with employment regulations and laws, you risk being seen as a toxic workplace that does not value employees, leading to employee turnover and low morale.
Our HR Compliance Checklist can also help you mitigate risk of non-compliance! Download today.
Unified HR Compliance Efficiency
Time is the one resource that there is never enough of. A unified HR compliance strategy and solution can help your team get back valuable hours into your week. A centralized system not only helps to reduce administrative burden by having all reports and data in one location but also allows for a faster response time for audits or regulatory inquiries.
If your organization has locations in multiple states, you can use one system to organize your data and pull information from for both federal and state reporting requirements. This will save you time because you don’t have to gather information from each state and will have it all in one location.
Here are some other efficiency benefits to having a unified HR compliance solution:
- Streamlines Documentation and Recordkeeping: If all compliance requirements and tasks live in one place, it is easier and faster to retrieve documents when needed. Digital records in one database make it much quicker to find what you are looking for, when you are looking for it.
- Reduces Duplicative Work: Some federal and state reports require analysis from the same data. Having all this information in one central location can reduce the need for duplicate reports.
- Automates Processes: If all your data lives in one location, you can easily pull the information and manipulate it for your current work projects. This automatic process removes the manual component of pulling information from different systems or locations.
Unified HR Compliance Cost Savings
In today’s day in age, companies are looking for any way to save money and help improve their bottom line. One easy way to do this is through a unified HR compliance solution or service.
The number one way a unified compliance strategy can save your business money is through the mitigation of risk of non-compliance. Non-compliance with labor laws can lead to significant monetary penalties, lawsuits, and settlements. A single violation could cost your business anywhere from thousands to millions of dollars.
Not only can a unified approach save you money in potential fines, but also other ways that effect your bottom-line:
- Lower Administrative & HR Costs: HR teams can spend less on manual tracking and reporting through a centralized system, freeing up their time to focus on more important, strategic initiatives. A centralized system can also eliminate redundant work, reducing the need for extra staffing or overtime pay for compliance-related tasks when deadlines loom.
- Improves Workforce Stability: When your organization has a strong compliance foundation and fair labor practices, you create a strong, safer workplace. This can lead to lower employee turnover and the costs associated with recruiting and training a new employee. When you have a solid compensation structure, employee satisfaction will improve, along with employees’ desire to stay with your company because they feel valued.
Unified HR Risk Management
Having a strong HR compliance foundation is crucial for your organization. Not only will it mitigate the risk of non-compliance but will also save you time and money and offer your organization better protection and security from non-compliance.
Here are some additional ways a unified HR compliance strategy can help provide your organization with solid protection.
- Ensures Policy Enforcement: When you have a unified approach, you ensure that compliance standards are consistent across all departments, locations, and employee levels. This will help you prevent inconsistencies that could lead to discrimination claims or employee lawsuits.
- Strengthens Employee Protections: When you have a unified system, you can ensure that all employees receive the proper compliance training, such as harassment prevention or workplace safety, reducing risk of liability.
- Improves Audit Readiness: A unified system helps to streamline your record keeping. If you are audited, your team can easily pull the information needed. A centralized system also helps you produce consistent, accurate reports, reducing the risk of missing documentation or inconsistencies.
Solutions for Unified HR Compliance
When it comes to implementing a unified HR compliance strategy, there are many things to consider. One of the main factors is to determine if you want to tackle these tasks in-house or outsource to an HR advisory firm.
Here are some benefits of handling these tasks in house:
- Faster Internal Communication: HR teams can quickly respond to compliance issues and policy changes without having to wait for an external vendor to respond.
- Integration with Company Systems: A unified solution can be built into existing payroll or employee management systems for easy tracking.
- Control and Customization: In-house compliance experts lead to immediate access to data and policies and allow for the ability to create a tailored compliance strategy that aligns with company culture.
Here are some benefits of outsourcing HR compliance tasks:
- Access to Specialized Experts & Regulatory Updates: When you outsource to an HR advisory firm, like OutSolve, you are not only paying for the report completion, but also the compliance professionals' knowledge and advice. Compliance consultants stay up to date on all the changing labor laws and regulations, a must during this time of regulatory uncertainty and changes, which can help reduce the risk of missed deadlines or inaccurate policies or reports.
- Reduces Workload: An outsourced strategy can help to free up internal resources so HR managers can focus on strategic initiative and core business functions like talent development and employee engagement.
- Scalable Solutions: Organizations can scale their compliance packages up or down depending on current needs. This can lead to cost-savings because you aren’t paying for resources you aren’t using.
- Lower Risk of Non-Compliance: When you outsource to experts, they will ensure accuracy and timely reports for all HR compliance related requirements. Expert consultants understand all the nuances of federal and state reports that an HR generalist may not.
What Unified HR Compliance Means for your Organization
A unified HR compliance strategy can not only mitigate your risk of non-compliance but save you time and money and offer stronger organizational protections. This is an important topic that all organizations should consider. By setting up a solid and unified strategy, you are setting your business up for success for years to come.
Consider partnering with OutSolve, the premier HR advisory firm for HR compliance. We help you with staying compliant and tackling tasks like federal and state reporting, compensation benchmarking, pay equity audits, and more, all from one source. Click the button below to speak with one of our consultants who can offer a customized solution for your business.