5 reasons why compliance is important for businesses
- Claire Baker
- Jun 20, 2023
- 6 min read
Updated: Jun 22, 2023
HR is such a wet blanket, am I right?
Maybe steps were skipped here and there or an occasional off-color joke slipped, but we’re all adults here.
Everyone was getting things done and having fun until HR showed up, right?
Right?
Except are you sure that everyone was having fun? How do you know for sure that there aren’t consequences of skipping those steps?
Your long-suffering HR team probably didn’t get into this line of work just to ruin your day, I promise. In fact, most HR professionals do what they do because they care deeply about people, and helping them succeed at work.
So why is HR such a buzzkill?
In short, because we’re here to protect you and your job. If your job is running a company, then HR is going to work extra hard to make sure that company’s policies and processes make both you and the business successful. Thus, in many ways, HR is a reflection of your company’s leadership culture: if leadership takes a do-as-I-say approach, then your HR team’s recommendations will also be more prescriptive than collaborative.
Leaders can be HR’s toughest customers, because leadership positions make it harder to see the effects of problematic policies, insensitive comments, or not-quite-compliant shortcuts. Below are five ways that your pecksniffian* HR team is really trying to help you.
*pecksniffian - (1) affecting benevolence or high moral principles, (2) an erroneous perception about the personality traits of HR professionals.
5 ways compliance helps your business
1. 😊 Compliance improves employee satisfaction and retention. Policy is your company’s opportunity to strategically build your culture and prevent people management issues before they start. When a company deliberately strengthens team bonds, looks out for employees’ interests, defines clear boundaries, and provides guidelines for appropriate behavior, it creates a harmonious environment where people stop focusing on problems and focus on work instead. What to do: Take a long view on productivity and show that you respect your team by adhering labor regulations. Review your company policies to ensure that your team receives fair wages and overtime pay, that your operational procedures enable regular breaks during the workday, and make sure that it’s easy for your team to take advantage of sick and vacation leave. Make sure that your harassment and discrimination policy is compliant with state and federal regulations, and regularly review your implementation and enforcement procedures to make sure that you’re following best practices.
2. 🥰 Compliance fosters a positive culture. Workplace policies prevent avoidable negative cultural trends by providing clear boundaries for appropriate behavior. Policy is your company’s opportunity to strategically avoid cultural issues like interpersonal conflict, employee grievances, absenteeism, harassment, and overwork/burnout. When done well, your policies support productivity and can even attract new talent to your team. For more turning your policies into a competitive advantage, check out this post.
HR policies that define appropriate discussion topics and comments aren’t meant to change your beliefs, they just preserve harmonious relationships so that everyone can focus on work. (At the risk of sounding pecksniffian,) if you think that HR policies just protect people who are “too sensitive,” it may be worth reflecting on how objections to problematic behavior have interfered with your ability to get things done with your team mates.
What to do: Use your policies as a tool to drive culture change and intiatives. Collect feedback from your team, and review your policies regularly to drive change and improve your culture. Consider how compliance regulations are meant to protect stakeholders, and find ways to deliver those outcomes authentically.
3. 👷🏽 Compliance creates a safe and healthy workplace. Workplace injuries don’t just hurt people, they hurt businesses, too. Workplace injuries only take a moment of distraction to take your team members offline, lead to fines and increased regulatory oversight, and possibly the need for additional training and equipment. In addition to the cost of fines and additional equipment, not following compliance regulations harms productivity through lost hours and leaving your team short-staffed. Not to mention the negative effect it has on morale when your team sees that your business doesn’t prioritize their wellbeing. White collar and remote workers aren’t exempt from workplace safety concerns. OSHA has defined COVID-19 exposure as a workplace safety hazard, and many states require businesses (including offices) have COVID safety protocols in place. White collar professionals are also at increased risk for debilitating repetitive overuse injuries and health problems resulting from physical inactivity. Knowledge workers are also at an increased risk for serious mental health issues resulting from stress and burnout. What to do: Provide ergonomic tools and personal protective equipment to your team, and make it inconvenient not to use them. Make sure that all team members are trained on your safety procedures and know the protocols when there is an incident. Take your employees’ mental health as seriously as you take their physical health, and put policies in place that promote rest and protect healthy work-life boundaries.
4. 🧑🏻⚖️ Compliance avoids legal trouble: Every compliance requirement is an artifact of a problem that affected enough people to be written into law, either through legal action or tremendous political pressure. Regulations wouldn’t be necessary if the incentive for problematic behaviors weren’t strong. Before you dismiss compliance regulations as not applying to you, consider that many business leaders may have thought the same – at their business’s peril.
What to do: Check yourself before you wreck yourself. (At the risk of sounding pecksniffian,) if you are tempted to waive compliance regulations, reflect on the reasons why regulations are required in the first place, and what might might motivate business owners to engage in prohibited behavior. Find a way to follow the regulations that is consistent with your company’s culture and processes. Then thank the HR professional who brought it up to you.
5. 😇 Compliance gives your reputation a boost. Not prioritizing compliance suggests that you lack integrity, which can make employees, business partners, and customers less inclined to trust do business with you. Even the perception of impropriety or a lack of integrity can damage your company’s culture, reputation, and productivity.
On the other hand, following compliance regulations even when there isn’t pressure to do so demonstrates respect for your team, business partners, and community that can only strengthen relationships, and support a high-trust culture. In return, your positive reputation will drive brand loyalty and let you charge a higher price for your product and services.
What to do: Understand the goal that regulations are in place to achieve, and use them as an opportunity to exceed expectations. Where possible, double down on processes that are consistent with your company’s mission & values, and find authentic ways to incorporate those goals into your messaging.
25% of workers don’t trust their employers.
New MIT research shows that employees in a high-trust culture are 260% more motivated to work, have 41% lower rates of absenteeism, and are 50% less likely to look for another job.
As fun as it is to follow the exploits of a character like Saul Goodman, your team, customers, and bottom line would probably prefer to work with a company whose behaviors were more consistent with Atticus Finch. Although your HR team probably aren’t lawyers, they’re here to keep you on the straight and narrow, and their recommendations are ultimately for the good of the company.
Would you rather…
... or ...
Prioritizing compliance can not only help keep your company out of legal and financial trouble, it can help you attract and retain loyal customers and employees. The harmonious internal culture will help you build better products and services, which further supports a reputation that lets your charge more for them.
So the next time your HR team comes at you with cold shower vibes, don’t avoid the conversation. Give their suggestions serious consideration, and don’t forget to thank them in the end. If you don’t have an HR or People leader yet, talk to your attorney or contact an HR professional (🙋♀️ like me!) for advice on where to start.
Compliance may not be as much of a downer as you think, especially when you see the positive effects that a more deliberate approach to compliance has on your culture and sales.
Summary:
HR is here to protect your job and your business, not ruin your day.
Compliance offers an opportunity to review your company culture and processes.
Complying with workplace safety regulations saves time and money.
If you don’t think compliance is relevant to you, it probably is.
Compliance guidelines give you a roadmap to build a reputation that inspires loyalty and premium pricing.
Want to learn more about how to create policies that people support, not resent? Check out these related articles:
(Coming soon!) Why unlimited PTO isn’t all it’s cracked up to be
(Coming soon!) Are your policies really inclusive?
(Coming soon!) Is your harassment training the wrong kind of cringey?
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