Human Resource compliance is a business-critical topic in today’s highly regulated and litigious environment. Being aware of constantly changing labor law is critical to ongoing business success. Being compliant with those laws is the responsibility of the employer, and is most generally delegated to the HR department. If you operate a small business today, having the luxury of an internal HR department may not be a resource to which you can turn.
Whenever I’m driving down the street, minding my own business, and come across one of those police trailers with the posted speed limit and digital radar, my first inclination is to punch it to see if I can hit triple digits. For some reason, this is my initial reaction as if it’s a contest to see who’s the fastest. While the majority of us are law-abiding citizens, when it comes to traffic laws we’re no angels. Speed limits? “Just a suggestion.” Stop signs? “Only if there are no cars or pedestrians.” Stopping before you enter the crosswalk? “There was a crosswalk?” Solid white line versus a broken white line? “I thought they were the same, one just needs some fresh paint.” No, U-Turns? “Only if the space is too tight, then you just make a quick 3-point turn.” When you start breaking down the letter of the law that governs traffic safety it can become overwhelming. Who can remember all those details? When we are behind the wheel most of us are cautious, watch for hazards and move with the flow of traffic, which for the most part, works well. However, we’re breaking the law! It’s not intentional, we just get caught up in the flow of things.
The operation of a business runs much like the flow of traffic. Business leaders set policies and procedures to deliver a service or product to their customers in a manner which produces a net profit that achieves their financial goals. The majority of businesses are running ethically, care about their employees and customers, and maintain a positive reputation in the communities they serve. However, all businesses are subject to a set of Federal, State and/or Local labor laws and regulations. In most cases, many of them are not being followed to the letter of the law. Just like drivers on the road, business leaders are going with the flow keeping the spirit of the law at the forefront, but are missing the mark on the details. Unless the business employs a seasoned labor attorney, seasoned HR practitioner or is in the business of employee administration, they very likely aren’t going to be operating in a fashion that adheres to the specific details of the governing labor laws.
Business owners get into business because they have a passion, are good at something, or are filling a need. At present, California alone has over three million registered businesses. Of those businesses, 1,068,602 have employees which equates to millions of employees. If the owner of a company is fortunate enough to grow their business and find they need to hire employees in order to meet demands, they have suddenly added a layer of liability that they often aren’t prepared for. During my career, I have encountered countless businesses that had an office manager, payroll processor, shop foreman, registered nurse, CFO, et cetera, handling the duties of employee administration. Each was dedicated to the proper treatment of their respective employees, but none were knowledgeable about labor laws. When you start looking at the letter of the law with respect to overtime, exempt vs. non-exempt, meal periods, breaks, interview questions, leaves of absence, accommodations, required trainings, and so on, it becomes daunting. Business leaders often find that they are working IN the business rather than ON the business when they have employees, how much more IN the business would they be if they studied and committed all of these laws to memory!
The legal landscape is constantly changing. Even if a business leader is committed to the proper application of the governing labor laws, staying on top of changes becomes a full-time job, and who has time for that? What was applicable a year ago may be completely different today. In order to stay abreast of change, business leaders need a reliable resource and need to make it part of their routine to review and study the changes that affect how employees must be treated. It would be safe to say that if one chose to do so, the majority of their workday would be consumed by it. Consider the options, continue to go with the flow and HOPE that a legal issue does not arise thereby bringing your business practices into question, or make the decision to dedicate yourself, or someone else, to the task of staying on top of changes and comprehend what to do to keep your company out of court.
When one chooses to start a business and have employees, one also chooses to comply with all Federal, State and Local laws which pertain to employee administration. Labor laws were established to protect workers from wrongdoings by employers. Ignorance of the law is no excuse, you need to know it, period. Protect your company and make sure you acquire the knowledge needed or have a trusted advisor in your corner to help you navigate these rough waters.
