Compliance Challenges And How To Overcome Them With Technology
There is a famous line from Spider-Man, “With great powers come great responsibilities.” The same can be said for the HR department, but with a slight difference. Every responsibility you have in the Human Resources Department comes with many challenges. Regardless of how well-planned your strategies are, unavoidable circumstances will always put a stop to your progress. Compliance with laws and employment regulations is one of the most challenging aspects of Human Resources. As a result, this article will discuss some of the HR compliance challenges and how to overcome them with Technology
Market Compliance Shifts
When Wells Fargo & Company carried out a survey in 2016 to determine whether the global economy’s decline would affect U.S. companies’ ability to enter international markets, it discovered that 87% of U.S. companies and enterprises still believe that expanding their businesses globally is necessary to achieve long-term growth.
Global business expansion, on the other hand, is a difficult process. As an employer, you must understand how payroll works. Companies are required to submit a slew of documents and other legal compliance within three months, especially when considering the organization’s global expansion plans. In other words, compliance requires not only rigor but also a significant amount of time.
This becomes even more complicated as shifts and new trends in global market compliance occur. Not to mention the additional time required to complete the requirements. Fortunately, there are Employers of Record (EOR) who can assist you in expanding your company into the international market without any complications.
Payroll Compliance Mishandling
Payroll compliance is a critical factor in multinational business expansion. The rules, regulations, and laws differ from one country to the next and change on a regular basis. Payroll mismanagement is frequently the root cause of paying large fines and penalties. That being said, your Human Resources Department must keep a close eye on developments in this area, especially since some countries have different regulations in place from one region or municipality to the next. In other words, different laws may apply to different regions and municipalities within a country. Given the complexities of this aspect, it would not be surprising if HR made mistakes.
Policy Regarding Benefits
Employee benefits can be approached and enforced in a variety of ways. You can learn more about the statutory benefits, employee satisfaction requirements, and other details by visiting the official government website of the country in which you want to expand your business. Your HR department can also contact the contact-specific individual to obtain more detailed information on benefits. Benefits policy planning provides an excellent opportunity to evaluate and determine whether you are overspending on employee benefits.
Pension and Retirement Plans
Employers frequently make the mistake of misusing and confusing the terms retirement and pension. These two terms are distinct, and while they are related, it is critical for you as an employer to understand each one. A pension is a managed and constructed sum of money based on an employee’s salary and services. It is the amount of time an employee has worked for the company. In contrast, retirement refers to the age at which an employee decides to leave the workforce.
As you recruit more employees from other countries, you will become more familiar with the compliance, payroll processes, and labor laws that these countries have in place, including, and especially, retirement and pension plans.
Data Privacy and Cyber Breaches
A data breach at Adobe in October 2013 affected 153 million user records. The report claims that hackers stole over 3 million encrypted credit card records from their customers and clients. Later that year, Adobe was charged $1.1 million in legal fees and an undisclosed amount of money to settle some of the affected users’ claims.
If cyber breaches can happen to goliaths like Adobe, it’s absurd to believe that small and medium-sized businesses are immune. With technological advancements in recent years the threats of hacking and other forms of cyber-attacks are more visible than ever. All businesses, including especially small businesses, are vulnerable. As a company executive, you must ensure that all vital and sensitive information is securely stored, encrypted, and protected from cyber-attacks.
How Technology can benefit HR with Compliance Management
The rules are what keeps everything in order. Compliance with all rules is critical for both small and large businesses in order to avoid legal penalties. Today’s technology can truly assist with this, as organizations can use HR technology to maintain compliance. The following are the advantages of investing in compliance technology:
HR Compliance Software
Modernizing the compliance procedure on a regular basis is a critical task that every organization in today’s world must complete. However, doing so manually or using traditional systems will only complicate matters. As a result, many businesses are investing in compliance management HR software. These systems enable businesses to manage every detail associated with HR compliance. Dependable compliance software is essential for all businesses today.
Some of the top compliance management software in the market are:
When businesses are required to report compliance issues to legal teams and regulators, they can use compliance HR software. This will aid in the automatic generation of reports, which will also aid in the prevention of HR compliance issues.
The most important aspect of human resource management is training new employees. So HRMS integration of that specific software system is required, which can train employees on a variety of topics such as diversity, health, sexual harassment, safety, and much more. If an audit is conducted, the company will have proof of its training. The HR software system assists organizations in tracking which employees have received training and which have not. It will additionally state when an employee must retake the training for certification purposes. All training is kept up to date so that compliance with changes in regulations is not a problem.
The best employee training software is listed below:
An electronic employee attendance system can greatly assist an organization in maintaining positive relationships with its employees and proper human resource management. HR departments can use the attendance management and payroll system to avoid several issues related to time off pay and work regulations, as well as federal leave acts. Such systems are also capable of tracking employee hours worked and tracking overtime discrepancies. Automated systems like these can also help with reporting systems for wages and time, which helps to avoid issues with auditors and employees.
Agencies continue to change regulations and add new files. It is critical for HR leaders and managers to stay on top of these changes. They can easily accomplish this with the assistance of HR cloud software. The software can provide management with information such as when the changes occurred, what the changes were, and who made them. Thus, choosing the best HR software in today’s market is critical.
With the use of recruitment HR software, various recruitment tools and applications within a company can work impartially and without bias. By doing so, any company’s HR department, large or small, can always remain compliant with nondiscrimination regulations, protecting the organization from auditor actions and lawsuits. These practices can help keep HR compliance issues at bay.
The top recruitment software in the market is:
Compliance is something that everyone can be aware of and help maintain by using different HR technology available in the market. When all departments are aware of compliance, it becomes part of the organization’s culture.
The benefits of using compliance technology are numerous, and the list above is only a partial list. Companies that understand how to use compliance technology all the while planning to address some of the challenges can improve HR task efficiency while also improving compliance.
This article was authored by Shafaque Ansari and published on January 9, 2023 via HR Tech Series.