HR.com’s State of Legal, Compliance, and Employment Law 2023-24

Elevate HR’s capabilities by better understanding effective compliance practices

Complying with employment laws isn’t easy, but some organizations make it look that way. So, what can we learn from them?

To find out, we conducted a major study. We discovered that only about a third of organizations have well-established compliance processes that employees understand, and they tend to do things differently. For example, they’re far more likely to train stakeholders, operate integrated systems, stay up-to-date with compliance issues, and easily create useful compliance-focused reports.
 

To help you understand, here are the highlights from ‘HR.com’s State of Legal, Compliance and Employment Law 2023’.

Finding: Most think their organization is well-prepared to deal with employment compliance concerns, but fewer say compliance initiatives are well-funded

A majority agree or strongly agree that their organization is well-prepared to deal with compliance concerns (74%). This might indicate that, even if organizations lack fully mapped-out and well-understood processes, most still know how to cope with situations when concerns arise. On the other hand, this still leaves about a quarter of respondents feeling relatively unprepared when compliance concerns emerge.

When it comes to budget, only 48% agree that compliance-related issues are well-funded. Some organizations may be tempted to cut corners to reduce their HR expenses, especially when companies are operating in multiple locations. Cutting corners, however, could become a costly mistake if fines and lawsuits come into play.

Finding: About half rate their organizations highly in maintaining an up-to-date understanding of all HR-related compliance issues

One of the most challenging aspects of HR compliance is that laws, regulations, and policies change regularly. This is exacerbated when organizations have a workforce in numerous locations, as they need to keep up with laws in each state.

To determine the extent to which organizations maintain an up-to-date understanding of compliance issues, we asked respondents to provide a rating on a scale of 1 to 10. We found that 48% say their organization does a good job at keeping up-to-date with these issues (that is, provide a rating of 8 or above on a 10-point scale). On the other hand, about half of respondents give themselves lower scores, and a quarter (27%) rate their organization as 6 or less, indicating much room for improvement.

Finding: Only two-fifths of organizations say their organization gives key stakeholders proper education and training

Getting sufficient resources to key stakeholders is an essential part of maintaining compliance. Still, organizations are struggling to do just that. Only 4 in 10 agree or strongly agree their organization gives key stakeholders proper education and training. Just a third say the same about tools and technologies. And only 28% believe the same to be true about support.

Of course, it is not enough to just have a compliance program. Key stakeholders need to have the right resources to maintain compliance.

Having the right tools and technologies can make compliance more efficient by cutting down the amount of time stakeholders spend on administrative tasks. Further, ongoing education and training are crucial, so employees can adhere to policies when going about their daily work and not inadvertently leak sensitive information.