“I don’t know — if somebody doesn’t tell me, how would I know?”
I saw this quote recently and thought about how it relates to human resources (HR) compliance. Many people are placed into office manager and human resources support positions with little if any knowledge or experience in compliance. The most prepared are those who have experienced a government agency audit, or have worked with and been trained by someone who has.
People responsible for compliance should know what to expect from the auditor and prepare for each agency. Business owners should have third-party audits conducted to assure those responsible have the knowledge and are prepared for an actual audit. “An ounce of prevention is worth a pound of cure.”
In January 2015 a Minnesota-based employer was fined over $627,000 for paperwork violations found on the Department of Homeland Security form I-9. They learned an extremely expensive lesson. They had already incurred the administrative cost to complete the forms, but failed to do them correctly, which would not have added any additional cost. If they had just known the rules and followed them, the outcome would have been so much better.
During my times as a generalist, manager, director and vice-president of human resources, I was audited by the departments of Labor, Homeland Security and OSHA, and DOT, and needed to defend claims of discrimination from the EEOC. It’s fair to say one learns more from failures than successes. I was that guy. The one who thought it wouldn’t happen to him. The one who thought just because he had a degree in HR he knew everything about compliance. The one who thought it couldn’t be that bad and he could just wing it. I will admit that I was very wrong.
During that expensive learning curve, I developed a true passion for HR compliance. I am no longer afraid of an auditor. In fact, I see it as an opportunity to validate my knowledge and abilities. How do you feel about an audit? Are you ready?
The cost of becoming compliant is much less than you might think, and surely less expensive than the fines and penalties for non-compliance. Could your company absorb a five- or six-figure fine? How would you explain something that was preventable to your boss, management or the senior executives?
Take steps now to make sure you’re compliant.
Douglas R. Pepin is a business consultant and owner of Advise-HR LLC. He has more than 25 years managing business human resources departments. Learn more at advise-hr.com or 651-888-1113.