To ensure the safety of workers and consumers, the government implements industry-wide standards of Non-compliance in the workplace can stem from data privacy failures, weak security controls, or overlooked internal processes.
Key Takeaways
- Corporate compliance violations usually happen due to unclear policies, outdated systems, or a lack of training, not deliberate misconduct.
- Standards like HIPAA, SOC 2, PCI DSS, ISO 27001, and GDPR impose strict data security and privacy requirements. Failure to comply can lead to fines, audits, lost business, and reputational damage.
- Addressing non-compliance requires continuous monitoring, regular training, documented controls, and leadership involvement.
To ensure the safety of workers and consumers, the government sets industry-wide rules that guide how workplaces must operate. When a company fails to meet these requirements, it is considered non-compliant and may face fines, legal action, or damage to its reputation. Having examples of common corporate compliance violations can help organizations spot risk areas and take steps to avoid costly errors.
What Is a Non‑Compliant Workplace?
“Non-compliance” refers to the failure to follow a law, internal policy, or industry standard. In a workplace setting, this often involves gaps in procedures meant to safeguard employees, customer information, or financial operations.
It’s important for businesses to understand that non-compliance isn’t always intentional or driven by misconduct. In fact, it can result from unclear policies, outdated systems, or insufficient training. Even when violations are unintentional, organizations are still held accountable and required to correct the issue.
Correcting non-compliance depends on identifying real-world failures as they occur. The following non-compliance examples illustrate common areas where violations occur, explain why they happen in the first place, and show how organizations can address them before they lead to enforcement actions or penalties.
1. Failure To Comply With HIPAA Regulations
Many examples of non-compliance involve the Health Insurance Portability and Accountability Act (HIPAA). HIPAA is meant to protect patients’ private health information. In healthcare settings, staff need to share patient data to deliver care, but this also increases the risk that sensitive information may be improperly accessed, disclosed, or handled.
Some common HIPAA compliance failures include:
- Discussing confidential patient details in public or with unauthorized individuals.
- Improperly disposing of medical records that are no longer needed.
- Failing to secure medical records, whether digital files or paper documents.
HIPAA violations can have serious consequences for healthcare organizations, including large fines and damage to patient trust. Repeat violations can also lead to audits or required corrective action plans.
Why Do HIPAA Violations Happen?
Most of the time, HIPAA violations happen because people don’t realize that what they’re doing is against the rules. If employees aren’t aware of the specific privacy laws they need to follow, they’re likely to inadvertently violate them.
How Can Companies Address HIPAA Violations?
Offer training and information about HIPAA compliance to all personnel. Ensure everyone knows what HIPAA requires and the role they play in maintaining it.
For example, IT staff should understand digital security protocols for electronic health records, and records clerks should know how to properly archive or dispose of documents. When each employee is trained on the rules relevant to their job, your facility is far less likely to experience a breach.
2. Failure To Meet SOC 2 Standards
Many organizations, especially those in technology and cloud services, are expected to meet SOC 2 standards. SOC 2 is a framework created by the AICPA that reviews how well a company protects customer data, including security, availability, data accuracy, confidentiality, and privacy.
SOC 2 is not a law, but it has become an industry standard for showing customers that their data is protected. When a company fails to meet SOC 2 requirements, it may receive a poor audit report, which can hurt client trust. A failed or difficult SOC 2 audit can also delay sales, cause customers to hesitate, and force teams to spend months fixing control issues.
In simple terms, SOC 2 non-compliance often means a company has weaknesses in its internal controls that put sensitive data at risk and make potential customers wary of doing business with them.
Why Do SOC 2 Violations Happen?
Maintaining SOC 2 compliance can be difficult, and organizations commonly fall short for a few key reasons:
- Weak or missing controls: Some companies do not have all required security controls in place, or the controls they have do not work properly.
- Poor documentation and evidence: Incomplete or outdated records are a common audit issue. Missing items like access logs, system changes, or training records often lead to audit findings.
- Training and awareness gaps: Even strong policies can fail if employees are not aware of them. A lack of training can lead to mistakes such as weak passwords or improper handling of sensitive data.
When employees don’t understand why SOC 2 matters or what is expected of them, compliance efforts can quickly break down.
How Can Companies Address SOC 2 Violations?
The most effective way to handle SOC 2 is to treat it as an ongoing process, not a one-time effort. Start by making sure all control activities are clearly documented and kept up to date. Before the official audit, run a readiness assessment or mock audit to identify gaps early.
Next, fix weak controls and automate them where possible. For example, use tools to enforce password rules, track access logs, and detect unauthorized system changes. Automation helps controls work more consistently and creates the evidence auditors expect to see.
Regular employee training is just as important. Staff should understand how to follow security procedures and why they matter. When employees know the purpose behind tasks like access reviews or incident response drills, they are more likely to follow them correctly.
Third-party vendors also need attention. If your company relies on outside service providers, review their security practices or request their SOC 2 reports. Weak vendor controls can quickly become your compliance problem.
Finally, keep leadership involved. Management should clearly communicate that SOC 2 compliance and data security are priorities and provide the resources and oversight needed to support them. With clear documentation, automated controls, trained employees, strong vendor oversight, and leadership support, companies can maintain SOC 2 compliance and avoid costly audit issues.
3. Failure To Protect Cardholder Data (PCI DSS)
Any business that accepts credit or debit card payments must follow the Payment Card Industry Data Security Standard (PCI DSS). When a company fails to properly protect cardholder data, it becomes a serious compliance issue and can result in stolen credit card information. Even one data breach can expose millions of card numbers, leading to fraud, identity theft, and expensive investigations.
Why Do PCI DSS Violations Happen?
Companies often violate PCI standards when they cut corners or do not have strong data security practices in place. Common causes include:
- Improper data handling: Storing credit card numbers or sensitive authentication data in unsecured formats is a common violation.
- Weak access controls: PCI DSS requires limiting access to cardholder data to only those who need it. However, many companies have outdated or overly broad access policies, allowing too many employees or systems to view card data.
- Lack of encryption and monitoring: Encryption is a core PCI requirement. When cardholder data is stored or transmitted without encryption, it can be easily intercepted.
Each of these gaps increases the risk of a data breach and exposes the business to non-compliance penalties. In many cases, organizations were aware of PCI requirements but overlooked or cut corners on critical security practices, leading directly to these violations.
How Can Companies Address PCI DSS Violations?
To protect cardholder data and stay PCI compliant, organizations need strong security controls and consistent best practices. Cardholder data should be protected with encryption or tokenization whenever it is stored or transmitted. Access to this data must be tightly restricted so only employees with a legitimate business need can view it, and all accounts with access should use unique logins and multi-factor authentication.
Businesses should actively monitor systems and networks for suspicious activity, using automated alerts and regular log reviews to catch unauthorized access early. Systems should be kept up to date by applying security patches, changing default passwords, and fixing known vulnerabilities.
Organizations should also run vulnerability scans or penetration tests to identify security gaps. Sensitive authentication data—such as magnetic stripe data or CVV codes—must never be stored after a transaction is approved, as this is a common cause of breaches. Regular self-assessments or audits by a Qualified Security Assessor help confirm that all 12 PCI DSS requirements are being met.
4. Failure To Maintain an ISO 27001 Information Security Management System
ISO/IEC 27001 is an international standard for managing information security. Many companies seek ISO 27001 certification to show clients and partners that they take cybersecurity risks seriously and have formal controls in place. However, earning the certification once is not enough. Organizations must continuously maintain their Information Security Management System (ISMS).
When a business fails to meet ISO 27001 requirements over time, security gaps can develop, and certification may be suspended or withdrawn. Losing ISO 27001 certification can damage credibility and harm a company’s reputation, as clients may question whether their data is being properly protected. In some industries, ISO 27001 non-compliance can also result in lost contracts when certification is required.
Why Do ISO 27001 Violations Happen?
Implementing ISO/IEC 27001 compliance requires ongoing effort, and organizations commonly fall into non-compliance in a few key areas:
- Incomplete or outdated documentation: ISO 27001 requires formal documentation such as security policies, risk assessments, treatment plans, and audit reports. Audit failures often occur when documents are missing, outdated, or not properly approved.
- Employees not following documented procedures: Auditors verify whether employees are actually following ISMS procedures in daily operations. Non-compliance occurs when staff are unaware of policies or fail to follow required processes.
- Lapses after initial certification: Many organizations relax their efforts after passing the initial certification audit. Over time, internal audits, risk assessments, and security meetings may happen less frequently, and employee training may be neglected.
These issues often stem from poor communication, limited training, or a loss of focus after certification is achieved. When employees are not fully engaged in the ISMS or ongoing maintenance activities are deprioritized, gaps quickly appear. As a result, organizations can fall out of ISO 27001 compliance within a year, especially when the ISMS competes with other business priorities.
How Can Companies Address ISO 27001 Violations?
The key to ISO 27001 compliance is making the ISMS part of everyday operations and company culture. Organizations should start by keeping all required documents and records accurate, up to date, and easy to access. Policies and procedures should be reviewed at least once a year, or whenever major changes occur, so they don’t become outdated.
Compliance also requires putting security processes into practice, not just documenting them. Even after certification, companies should continue running internal audits, risk assessments, and management review meetings. These activities help identify gaps early and prevent standards from slipping over time.
Ongoing employee training is equally important. Staff need to understand their information security responsibilities, know where to find current policies, and receive regular reminders so security stays top of mind. When roles change or employees leave, responsibilities should be reassigned to ensure no controls are overlooked.
Maintaining ISO 27001 is ultimately about continuous improvement. Audit findings and security incidents should be treated as opportunities to strengthen the ISMS. Senior leadership plays a critical role by providing the time, resources, and oversight needed for audits, training, and ongoing compliance.
5. Failure To Comply With GDPR and Privacy Frameworks
Data privacy laws such as the European Union’s GDPR (General Data Protection Regulation) and similar rules like California’s CCPA set strict requirements for how organizations handle personal information. When a workplace fails to follow these laws, the consequences can be severe.
Under GDPR, penalties can be especially steep. Companies can be fined up to 4% of their annual global revenue for serious violations. In recent years, regulators have issued fines worth millions of euros to companies for privacy failures.
Financial penalties are only part of the risk. Non-compliance can also lead to orders to stop certain data practices, lawsuits from affected individuals, and long-term damage to a company’s reputation. As customers become more aware of data privacy, organizations seen as careless with personal information can quickly lose trust and market share.
Why Do Privacy Violations Happen?
There are several common reasons organizations fall out of compliance with GDPR and other privacy laws:
- Lack of proper consent or transparency: Companies may collect or use personal data without valid consent or without clearly telling individuals how their data will be used.
- Inadequate data security measures: Non-compliance often occurs when businesses fail to implement basic security controls such as encryption, access limits, firewalls, or timely security updates.
- Collecting or keeping data longer than necessary: GDPR emphasizes data minimization and limited retention. Some organizations gather more personal information than they need or keep it indefinitely.
- Ignoring data rights or transfer requirements: GDPR gives individuals the right to access, correct, or delete their personal data. Companies sometimes fail to respond to these requests or lack systems to handle them. Problems also arise when data is shared with third parties or transferred across borders without proper legal safeguards in place.
Privacy compliance is challenging because it applies to the entire data lifecycle, from how data is collected to how it is stored, shared, and ultimately deleted.
How Can Companies Address Privacy Violations?
To avoid GDPR and similar privacy violations, organizations should take a proactive and transparent approach to handling personal data. Key best practices include:
- Get clear consent and be transparent: Always obtain explicit consent before collecting or using personal data, unless another valid legal basis applies. Clearly explain what data you collect and why, either in a privacy notice or at the point of collection.
- Know your data (data mapping): Organizations need a clear understanding of what personal data they have, where it is stored, and who has access to it. Conducting a data-mapping exercise helps document data flows, supports compliance, and makes it easier to respond to data subject requests.
- Limit data collection and retention: Collect only the personal information you actually need for a specific purpose. Regularly removing outdated data reduces risk and supports GDPR’s data minimization principles.
- Strengthen security controls: Use up-to-date security measures to protect personal data, such as encryption, firewalls, malware protection, and strict access controls.
- Prepare for incidents and data requests: Organizations should have a data breach response plan that includes notifying regulators and affected individuals within required timeframes.
By following these practices, organizations can significantly reduce the risk of GDPR and privacy violations. Beyond avoiding fines, strong privacy practices help build trust, protect customer relationships, and strengthen a company’s reputation in an increasingly privacy-focused market.
6. Failure To Follow OSHA Safety Regulations
Workplace safety laws enforced by the Occupational Safety and Health Administration (OSHA) set clear rules for manual labor and other high-risk work. When employees do not follow required safety procedures on a job site, the risk of serious injury increases and can lead to accidents if the issue is not corrected.
Why Do OSHA Violations Happen?
Often, there are underlying reasons why workers don’t adhere to safety protocols. Some of the most common causes include:
- Inadequate training: If employees don’t know the proper safety procedures, they can’t be expected to follow them and may not even realize they are being non-compliant.
- Forgetfulness: With so many rules and tasks on the job, workers might forget certain precautions over time, especially if those precautions are not regularly emphasized.
- Not understanding the importance: If an employee doesn’t grasp why a safety rule exists or the danger of ignoring it, they may be tempted to cut corners.
In many cases, these issues boil down to simple oversight. OSHA has noted that violations often result from carelessness or negligence rather than willful disobedience. Employees might not set out to break the rules, but without reinforcement and understanding, compliance can slip.
How Can Companies Address OSHA Violations?
Fortunately, this example of non-compliance in the workplace is easy to address. New employees should receive thorough safety training during onboarding, and veteran employees should undergo periodic refresher training.
Regular safety checks, clear enforcement of safety rules, and involvement from supervisors help make sure OSHA requirements are followed on the job.
7. Failure To Properly File Incident Reports
In many workplaces, accidents and incidents must be documented to meet legal, contractual, or internal compliance requirements. For example, companies may be required to file reports for employee injuries, equipment damage, workplace violence, harassment complaints, or near-miss safety incidents.
Incident reports create a clear record of what happened, who was involved, and what steps were taken afterward. When required reports are not filed, organizations can fall out of compliance with internal policies, insurance requirements, or industry rules, which can lead to audits, denied claims, legal disputes, or other consequences.
Why Do Incident Reporting Violations Happen?
Incident reports are often missed because these situations are stressful and move quickly. Common reasons include:
- Shock or panic: If someone is injured or there is a medical emergency, employees naturally focus on helping first. In the moment, they may forget that a report is required.
- Confusion about what mandates a report: When an incident seems minor, employees may not know whether it needs to be reported. This confusion can lead to required reports being skipped or unnecessary ones being filed.
How Can Companies Address Incident Reporting Violations?
As with the other compliance issues, giving clear instructions and training is the best way to prevent reporting issues. Employees should know exactly what to do when an incident happens, including when a report is required and how to file it. Practicing these steps ahead of time helps employees stay calm and follow the process during a real incident.
Companies can also use digital incident reporting systems or centralized tracking tools to ensure reports are submitted on time, stored consistently, and easily reviewed for compliance, audits, or follow-up actions.
How Compyl Can Help Solve Non-Compliance in the Workplace
Addressing non-compliance issues requires time, energy, and attention to detail, but you don’t have to manage it all alone. Compyl offers a cutting-edge compliance platform that can help ease the burden. Compyl’s solution continuously monitors your organization’s adherence to various frameworks, all in one integrated system.
It automates many compliance tasks and provides real-time alerts when something falls out of line. By centralizing compliance management, Compyl makes it easier to spot and resolve non-compliance before it leads to violations or penalties. The result is a safer workplace, protected data, and peace of mind that your company is meeting its obligations.
Request a demo today to learn more about Compyl’s workplace compliance solutions.
