Human Resources is one of the biggest expenses a new or growing company might have. It can also be one of the biggest ‘headaches’ if you have not done your homework in the area of compliance.
In other articles, we point out that Human Resources is one of the biggest expenses a new or growing company might have. It can also be one of the biggest ‘headaches’ if you have not done your homework in the area of compliance.
Simply stated, compliance means that your company and the people in it comply with all existing regulations regarding individual and group behavior. That is the simple definition. Alas, ignorance of the law is no excuse, and regulations are constantly changing. Therefore your obligation is to insure that your company is in compliance, and stays in compliance. Compliance is a process, rather than a static check-in.
Key areas for compliance
Here are some of the areas that need to be considered:
Fair Labor Standards Act – deals with compensation, including employee leave, unemployment compensation, and others
OSHA – health and safety, including public posters and workers comp insurance
>EEO – sexual and other harassment is illegal
>VII – hiring, firing and promotions
HIPAA Health Insurance Portability and Accountability Act of 1996
Other areas include:
- Alcohol and Drug Testing
- Retirement and Pensions
- Workplace Violence h2. Compliance Process
When should you do this? Realistically (not legally, so don’t quote us), it seems like a hassle to do it when there are only three of you…you, your best buddy and your new CEO. However, the moment you begin to hire down the ranks, and there are managers supervising other people, you must have this in place. Otherwise, you have to play catch-up, and, you are leaving yourself at risk for unforeseen lawsuits and problems.
If you use an outsourced HR group for payroll, most likely they can help you create the systems you need to be in and remain in compliance. The top three items for compliance are:
- Educating everyone about the laws and policy (this is a legal requirement
- Creating and maintaining an HR policy manual that is made available to all employees
- Keeping impeccable documentation regarding employment agreements and termination
The best way to stay in compliance is to use standardized procedures for everything. Here is a sample list of forms your company might need:
- Application for employment
- Background Check (permission, check)
- Reference Check
- Chart of Benefits
- Employee handbook
- At-will employee acknowledgment
- Employment Agreement
- Confidentiality Agreement
- Offer Letter, including Options
How to create these
One of the Spartina principles is, don’t reinvent what already exists. Therefore, in the case of HR, we firmly believe that the best way for a company to proceed is to Use Expert Outside Resources. On our website you can find a list of HR firms and consultants. Use them to get your company compliant. It is money well spent.