Why all hrm stakeholders need to be aware of the relevant laws of the land and be mindful of compliance and other regulatory issues
Answers
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.
Common examples of the types of laws regulating the employer-employee relationship include: the Fair Labor Standards Act, which establishes the minimum wage and rights to overtime pay for certain workers; federal civil rights laws, which prohibit employers from considering race, gender, age, or other “protected” status when making hiring and firing decisions or otherwise setting the terms and conditions of employment; the Family and Medical Leave Act (FMLA),which grants certain employees the right to take up to twelve weeks of unpaid leave each year in specific circumstances, as well as the right to be restored to the same or equivalent position upon returning from such leave; and the Uniform Services Employment and Reemployment Rights Act (USERRA), which establishes certain rights and protections for employees who are called to active military duty.
In many organizations, the HR function also manages the various compensation and benefit programs, which are heavily regulated as well. For private-sector organizations this means complying with the Employee Retirement Income Security Act’s (ERISA) reporting, disclosure, and fiduciary requirements, among other things. This is a task made more difficult by frequent, significant changes to ERISA and other relevant laws. The new Patient Protection and Affordable Care Act (PPACA) is only the most recent example; it establishes more than two dozen new rules relating to employer-sponsored health benefits, including several that take effect beginning with the 2011 plan year.