Most businesses are aware of the need for ADA website compliance for example, but in 2020 there are more compliance trends to consider.
Compliance risk is, essentially, a company's exposure to legal penalties, financial forfeiture and material loss an organization in the face of failure to comply with industry laws and regulations, as well as internal policies and industry best practices.
HR Role In Risk and Compliance
While the primary function of most HR professionals centers around employees and all that pertains to recruiting, hiring, training and supporting a company's workforce, there is often much more required of them.
According to an article at Corporate Compliance Insights,
"The human resources (HR) function is at the center of most employers’ efforts to identify, hire and retain the people the organization needs to execute its strategy and achieve its goals. But the HR function is a key player within the organization’s compliance structure as well.
There are numerous laws and regulations governing the employment relationship that HR professionals must understand and navigate in order to help ensure their organizations avoid costly fines and other penalties, including the potential harm to the organization’s reputation."
In addition, the HR function also manages the various compensation and benefit programs in many companies. And these programs are extensively regulated. For example, private-sector organizations must comply with the reporting, disclosure, and fiduciary requirements of the Employee Retirement Income Security Act (ERISA) , among other things.
Companies must work in an increasingly hostile and complex risk management landscape. Essential to mitigating some of the risk inherent in simply "doing business" is comprehensive employee training and communication. And effective HR processes can be very instrumental in supporting compliance throughout an organization.
Compliance Trends in 2020
There are a vast number of issues and compliance concerns that are either gaining new prominence, or have only developed recently. One source listed a number of what they see as "hot button" compliance issues going into 2020 including:
- The “Ban the Box” movement
- Fair and flexible scheduling
- Paid sick leave
- Medical and recreational marijuana
- Protection for gig workers (AB5)
- Pay equality
- Accommodations for pregnant and nursing workers
And, according to other experts, issues such as paid family leave and sexual harassment prevention will take the spotlight in 2020.
In California, for example, beginning on July 1, 2020, the maximum duration of paid family leave benefits will increase from six weeks to eight weeks. And the state of California recently enacted legislation to require employers with five or more employees to provide at least two hours of sexual harassment training to all supervisory employees. In addition, employers must provide at least one hour of sexual harassment training to all non-supervisory employees, including seasonal and temporary workers.
In addition, more than a dozen states, including California, along with several local jurisdictions enacted laws that prohibiting employers from asking applicants about their pay history or using that information when making compensation decisions.
New overtime regulations have taken center stage for thousands of businesses, as well.
Recently, the United States Department of Labor (DOL) finally revised the regulations governing the overtime exemptions under the Fair Labor Standards Act (FLSA). The new rule, which became effective on January 1, 2020, increased the minimum salary level qualifying employees for so-called “white collar” exemptions from $455 per week, or $23,660 per year, to $684 per week, or $35,568 per year.
One more trend to be aware of in California is the enactment of AB 5.
Essentially, the law requires that employers implement what is commonly known as the "ABC Test" to determine if a worker is to be properly classified as an employee or an independent contractor.
The test uses the following rules:
- The worker is free to perform services without the control or direction of the company.
- The worker is performing work tasks that are outside the usual course of the company’s business activities.
- The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.
There are some exceptions, such as doctors, dentists, psychologists, insurance agents, stockbrokers, lawyers, accountants, engineers, and real estate agents.
Professional Assistance for HR Compliance
In addition to HR management best practices and labor law compliance, we can offer online payroll software for your payroll process - a great option for staying in compliance on the payroll front.
Another "best practice" is to consider outsourcing.
This can be done by simply outsourcing one process such as payroll. However, with a full-service provider such as Accuchex, you also have additional options for outsourcing as well.
Let Accuchex help you in managing your HR needs, payroll processes, and staying on top of compliance demands. Get your Free Download: Payroll Outsourcing Guide to help you make an informed decision or call Accuchex Payroll Management Services at 877-422-2824.